Farm Business Income
Suggested citation for linking to this discussion:
U.S. Department of Agriculture, Economic Research Service. (2024, October 8). Farm Sector Income & Finances: Farm Business Income.
Errata: On October 8, 2024, the Farm Sector Income & Finances topic page was updated to correct a heading relating to the average net cash farm income forecast by commodity specialization in the Farm Business Income discussion. The error was in the heading text only; no other text or data were affected.
Average Net Cash Farm Income for U.S. Farm Businesses Forecast Down in 2024
Farm businesses are farms with annual gross cash farm income (GCFI)—annual income before expenses—of at least $350,000, or operations with less than $350,000 in annual gross cash farm income but that report farming as the operator's primary occupation. Farm businesses account for about half of all U.S. farms, but they contribute more than 90 percent of value of production and hold most of the sector’s assets and debt.
Average net cash farm income (NCFI) for farm businesses* is forecast at $106,200 for calendar year 2024, down 8.9 percent from 2023 in nominal terms. Net cash farm income is cash receipts from farming as well as farm-related income, including Government payments, minus cash expenses. Lower NCFI could mean less cash available to pay debt, pay taxes, cover family living expenses, and invest. NCFI is not a comprehensive measure of profitability because it does not account for changes in noncash income, including adjustments in farm inventory, accounts payable, accounts receivable, the imputed rental value of operator dwellings, and capital consumption.
The average NCFI forecast for 2024 varies across farming regions (see the FAQ on ERS resource regions) and commodity specializations** In 2024, farm businesses specializing in cotton are forecast to see the largest dollar decrease and farm businesses specializing in wheat are forecast to see the largest percent decrease in average NCFI. Farm businesses specializing in dairy are forecast to see the largest percent and dollar increase in 2024 relative to 2023. Among the six USDA, ERS resource regions where average net cash farm income is forecast to fall, farm businesses in the Heartland region are forecast to have the largest dollar and percent decrease in average NCFI.
See data tables on farm business average net cash income:
- Farm-level average net cash income by farm typology and sales class
- Farm business average net cash income by commodity specialization and region
Average Net Cash Farm Income Forecast To Decrease for Farm Businesses Specializing in Crops but Increase for Those Specializing in Animal and Animal/Products
In 2024, farm businesses in all six crop commodity specializations are forecast to have a decrease in average NCFI. Farm businesses specializing in cotton are expected to see the largest dollar decrease ($99,400) with average NCFI forecast at $286,900 in 2024. Farm businesses specializing in wheat are expected to see the largest percent decrease (48.5) with average NCFI forecast at $55,600 in 2024.
| Farm specialization | Average NCFI, 2024F | Change in average NCFI, 2023–2024F |
|---|---|---|
| Dollars (per farm) | Percent | |
| Cotton | 286,900 | –26 |
| Corn | 142,400 | –36 |
| Wheat | 55,600 | –48 |
| Soybeans | 60,000 | –38 |
| Specialty crops 1/ | 259,400 | –9 |
| Other crops | 65,000 | –21 |
| F = forecast. NCFI = net cash farm income. 1/ Specialty crops include fruit and tree nuts, vegetables, and nursery/greenhouse. Source: USDA, Economic Research Service, Farm Income and Wealth Statistics data product, Farm business average net cash income by commodity specialization and region. Data as of September 5, 2024. |
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For all types of farm businesses specializing in animals/animal products, average NCFI is forecast to increase in 2024 relative to 2023. For those specializing in dairy, average NCFI is forecast to see the largest dollar ($186,300) and percentage (50.9 percent) increase among animal/animal products specializations. This increase is due to expected higher cash receipts and lower costs for feed in 2024.
| Farm specialization | Average NCFI, 2024F | Change in average NCFI, 2023–2024F |
|---|---|---|
| Dollars (per farm) | Percent | |
| Dairy | 552,000 | 51 |
| Hogs | 218,300 | 14 |
| Poultry | 147,100 | 15 |
| Cattle/calves | 56,600 | 13 |
| F = forecast. NCFI = net cash farm income. Source: USDA, Economic Research Service, Farm Income and Wealth Statistics data product, Farm business average net cash income by commodity specialization and region. Data as of September 5, 2024. |
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Average Net Cash Farm Income is Forecast To Decrease in Most Regions
Regional performance of farm businesses can vary considerably because of the heavy geographic concentration of certain production specialties. Six of the nine USDA, ERS Farm Resource Regions are expected to see a decrease in average net cash farm income in 2024 compared with 2023. Farm businesses in the Heartland region are forecast to see the largest dollar ($33,700) and percentage (22.9) decrease in average NCFI per farm following lower crop cash receipts.
*Farm businesses are defined as operations with gross cash farm income of more than $350,000 (labeled "commercial") or smaller operations where farming is reported as the operator's primary occupation (labeled "intermediate"). USDA Agricultural Resource Management Survey preliminary data for 2023 indicates that 13.9 percent of U.S. farms are commercial, and 35.7 percent are intermediate. Residence farms make up the remaining 50.4 percent of operations; these are small farms with operators whose primary occupation is something other than farming.
**Commodity specialization is determined by a farm business having at least 50 percent of the value of production from a particular commodity. Farm businesses often produce multiple commodities, so average net cash farm income statistics should not be interpreted as resulting solely from the production and sale of the commodity highlighted as the specialization.