There are several reasons behind the USDA forecasting a 21% drop in net cash income for farmers this year, but one of the more obvious reasons is the roughly 34% drop in government payments. USDA chief economist Seth Meyer said 2023 will mark a couple of years in a row of direct government payments declining. Meyer said pandemic payments will halt plus, “with high commodity prices we see payments related to commodity prices decline as well too right so some of those payments that fluctuate with commodity prices, they’re shrinking to quite low levels here at connect expected for 2023.”
Meyer noted total direct government payments to producers is anticipated to be $10.2 billion this year, down from the $15.6 billion farmers saw last year, and well off the over $27 billion reported in 2021.
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