US farm net-income falling at a steeper rate than cash receipts

NEW YORK: Don’t be fooled by the recent rally for crop prices, as there’s still more pain ahead for the US farm economy. That’s the view of CHS, the country’s largest agricultural cooperative. US farm net-income is falling at a steeper rate than cash receipts, showing that fixed costs, such as land and equipment, are too high, said chief executive officer Carl Casale.

Farmland rents are demonstrating “stickiness” and aren’t dropping much, he said on Tuesday during the National Grain and Feed Association convention in San Diego. The US farm economy is “not at bottom,” he said.

The US Department of Agriculture estimates that domestic growers will see net farm-income fall for a third straight year to $54.8 billion in 2016.