The USDA Economic Research Service on Tuesday issued the 2012 Farm Income Forecast, which projects a $4 billion decline from last year's all-time high and a nearly $2 billion decline in net cash income, though value of production is expected to increase.
Farm equity is also expected to increase in 2012 as farm assets are should top the increase in farm debt.
Overall, net farm income is forecast to be $114 billion, with net cash income at $132.8 billion.
USDA Ag Secretary Tom Vilsack called the forecast "heartening," and added that the forecast confirms the resiliency of American farmers and ranchers.
"Thanks to its ability to remain competitive through thick and thin, U.S. agriculture is stronger today than at any time in our nation's history, supporting and creating good-paying American jobs for millions," Vilsack said. "While down slightly from the August forecast, today's estimates for net farm income are the second-highest since the 1970s, while total farm household income is expected to rise. At the same time, the positive trend of falling debt ratios continue."
Vilsack said the forecast suggests that strong farm income should remain a positive factor in carrying farmers and ranchers into the 2013 growing season, but additional help and assistance is needed for the next growing season through a new farm bill.
"This year, the farm safety net showed its mettle and merit, helping to deliver peace of mind to thousands of farmers and ranchers dealing with losses caused by natural disasters. It's a reminder that Congress must do the same, and pass a comprehensive, multi-year Food, Farm and Jobs Bill that provides greater certainty for farmers and ranchers in the season ahead. Providing the tools and certainty they need is the least we can do for those who grow our food, fiber, feed and fuel, even through the most challenging of times," Vilsack said.
Information released Tuesday incorporates data from harvest, sales and inventory, updating the August estimates. A final forecast of 2012 farm income data will be released in February 2013.
The latest 2012 farm income forecast is available here.