The USDA says dramatically lower commodity prices and plunging exports mean that 2009 net farm income is expected to be down 38 percent from 2008 estimates and 15% from the 10-year average.
Net farm income is forecast to be $54 billion in 2009, down $33.2 billion from the preliminary estimate of $87.2 billion for 2008. The 2009 forecast is $9 billion below the average of $63.2 billion over the past 10 years.
Net cash income, which takes into account the sale of carryover stocks from 2008, is expected to be down as well, but only by 30 percent from 2008 to $68.2 billion.
Annual receipts from food grains are expected to decline by almost 29% in 2009, mostly reflecting an anticipated 35% drop in wheat receipts, which should account for almost 77% of food grain receipts in 2009.
Much of the expected decline in wheat receipts from 2008 to 2009 results from a dramatic drop in price and reduced exports in the face of large world supplies. The average calendar price for wheat in 2007 was $5.74 per bushel, rising to $7.73 per bushel in 2008 before falling to a 2009 estimated range of $4.70 to $5.70, according to the last USDA world supply and demand report.
In the income report, released Thursday, USDA also projected total expenses to go down for the first time since 2002, though the $9.2-billion decline projected would still leave farm expenses 5 percent higher than in 2007, and the reduction in gross income will far exceed the reduction in production costs.
Despite these numbers, USDA said government payments are "forecast to be essentially unchanged" in 2009, with a projected decline from 2008 in ad hoc and emergency assistance payments being offset by increases in dairy and countercyclical payments.