The USDA is projecting a significant increase in US farm income in 2025, but the American Farm Bureau Federation is calling the expected gain “misleading.”
In its first farm income forecast for this year last week, the USDA said net farm income will jump $41 billion or 29.5% year-over-year to $180.1 billion. However, the key driver behind the forecasted increase in 2025 net farm income is a surge in direct government payments, which are expected to reach $42.4 billion — a 354.5% increase from 2024’s $9.3 billion.
According to the farm bureau, the sharp rise in government payments is primarily due to ad hoc disaster relief and economic assistance included in the newly enacted American Relief Act of 2025. Many producers are still waiting for details on when and how these funds will be distributed, the farm bureau said, creating additional financial uncertainty as unpaid bills from 2024 continue to pile up.
“As a result, viewing the 2025 forecast in isolation misrepresents the true health of the farm economy, which will remain challenged in 2025 by generally low commodity prices and widely uncertain market conditions, including the potential fallout from new trade policies such as tariffs that could disrupt key agricultural export markets and increase input costs for U.S. farmers,” said farm bureau economist Daniel Munch
Indeed, US farm cash receipts from commodity sales are expected to fall slightly in 2025, declining by $1.8 billion (0.3%) from 2024’s projected $516.8 billion to $515 billion. This marks the third consecutive year of lower cash receipts, largely due to weaker crop markets and “reinforcing concerns that any farm income gains are largely government-assistance-driven rather than market-based.”
Total crop receipts are forecast to fall by $5.6 billion (2.3%) from 2024’s $245.2 billion to $239.6 billion in 2025, pulled down by declines in major row crops. Corn receipts are expected to drop by $2.7 billion (4.3%) from $63.4 billion in 2024 to $60.7 billion in 2025, with both prices and quantities sold trending downward. Soybeans are projected to see an even sharper decline, falling by $3.1 billion (6.6%) from $47.4 billion in 2024 to $44.2 billion in 2025. Wheat and hay receipts are also expected to shrink, with lower prices playing a key role.
The outlook for livestock and dairy is more positive, with total animal/animal product receipts forecast to rise by $3.8 billion (1.4%) from 2024’s $271.6 billion to $275.4 billion in 2025. Gains in milk, hog and broiler prices are behind this increase, though inflation-adjusted figures suggest a more subdued market.
Meanwhile, total US farm production expenses, including operator dwelling expenses, are forecast to decline only slightly in 2025, falling by $2.5 billion (0.6%) to $450.4 billion. This marks the second consecutive year of expense reductions, following a projected $9 billion (2%) decline in 2024.
“However, despite these decreases, production costs remain historically high, and certain expense categories continue to rise,” the farm bureau said.
