Farmers’ Net Assets Have Risen Over $1 Trillion

U.S. farm equity in 2022 is 27.7% higher than it was in 2017 and 42.7% higher than it was in 2012. During the last 10 years, net farm income was above the long-run average (i.e., average from 2007 to 2022) from 2012 to 2014, and in 2021 and 2022, but the increase in farm equity is due to more than relatively high net farm income. This article discusses changes in the U.S. farm sector balance sheet.

Figure 1 presents real U.S. farm sector assets and debt values using 2021 as the base year. With the exception of 2022, the values for each year represent end of year values. Prior to 2012, the peak in real assets occurred in 1979 at a value of $2.837 trillion. In 2012, real assets for the farm sector totaled $3.048 trillion. Since 2012, real assets have exceeded $3 trillion. Real assets are projected to reach a new peak at $3.618 trillion in 2022. This represents a 3.4% increase from the previous peak in 2021.

Real farm sector debt in 2022 is projected to be $467.9 billion, a decrease of 1.3% from the year before. If realized, the decline in real farm debt in 2022 would represent the first decline in total debt since 2012. Current farm sector debt is 36.1% higher than the value in 2012 and 10.0% higher than the value in 2017.

Projected farm sector equity in 2022 is $3.150 trillion, which represents a 4.2% increase from the year before. Real farm sector equity in 2022 is 16.5% higher than the value in 2012 and 10.6% higher than the value in 2017.

Editor’s Take:

The number of farms has declined since 2012 and the net assets of the remaining farms has increased over a trillion dollars. Farmers and ranchers generally have outstanding balance sheets. In recent years, they have also experienced excellent net farm income. Need we remind you that one of the reasons you chose to become a CAD member was precisely to focus attention on farmers and ranchers. If you are not taking advantage of this amazing customer segment, the question should be asked – why not? In addition, the CAD program puts more tools in your hands with AgPack and AgTruckTrader.com that allow you the opportunity to trounce any non-CAD dealer and help you to conquest this market. Believe the report and believe what you read – farmers and ranchers are a prime audience for what you have to offer!