Continued Strong Farm Income Forecast by FAPRI

A group of leading ag economists is projecting strong net farm incomes for the next couple years. John Kruse is with the University of Missouri's Food and Agricultural Policy Research Institute (FAPRI). "We've got very strong commodity prices leading us to very strong net farm income levels," Kruse said. "We have to keep an eye on our fuel and fertilizer expenses on that side, and possibly labor."

According to Kruse, the Russian - Ukrainian war has been the main market driver for grains, noting tight ending stocks expectations, but livestock prices are finding support too.

Kruse told Brownfield Ag News Network, that higher feed costs for livestock have been somewhat offset by gains in the export market, especially with strong Chinese demand for U.S. pork.  "And, it's really given us some strong growth. The other thing has been the strength of U.S. pork demand, in general, for U.S. consumers," said Kruse. “The U.S. has seen a 'remarkable' growth period in per capita meat consumption.”

Kruse said the main risk for grain income beyond two years is an influx of supply, while disease pressures are the leading concern for livestock incomes.

Editor’s Take:

FAPRI is a well-respected forecasting group within the agricultural community. For them to state that farm income should remain high for the next year or two, is truly significant. Their models are capable of analyzing current events in real time, not like more static models used by other forecasters. That simply means their prediction is taking into account what is happening today. What does that mean for your sales approach going forward? With consumer sentiment dropping like the proverbial rock and interest rates and inflation surging like a rocket ship headed to space – things could get a little softer with sales. So where are your best customer prospects going to come from? Hint – farmers and ranchers! Why? Read this article again…