Many have recently noted the uptick in farm income and the trend towards record levels of direct government payments. However, ag economists say there are just two considerations to be watching.
David Widmar with Ag Economic Insight spoke with RFD-TV’s Christina Loren on net farm income and what is driving the current trends, as well as the numbers on farm debt.
According to Widmar, “The farm economy is probably reaching what we consider a “stable era,” which is not great returns but not a situation where we see continued financial erosion. Now the caveat to where we are here in 2020 is, we’ve reached this stability... the caveat here-- we have a lot of direct payment, a lot of ad hoc direct payment, and so if you pull up those direct payments and the ad hoc direct payments the farm economy would be in a much more bleak outlook... So, that raises a lot of question for what happen in 2021 when most of these payments aren’t going to be on the books.”
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