- Net farm cash income is expected to rise more than 23 percent to $85.3 billion — the second highest on record and above its previous 10-year average.
- Net farm income has rebounded, up 24 percent from 2009, when demand for agricultural products fell worldwide due to the global recession.
- Net value added, at $127.3 billion, is expected to be up $15.2 billion from 2009, and remain 17.7 percent above its 10-year average.
Two recent USDA reports show the strength of the overall rural economy and growth in agricultural exports. Agriculture Secretary Tom Vilsack had the following to say:
“The reports are encouraging news. They show that while American agriculture has struggled through difficult economic times, the 2008 farm bill, the efforts of the Obama administration — such as the Recovery Act — and the hard work and resilience of America’s farmers and ranchers have helped put American agriculture on the road to recovery.
“After declining more than 20 percent in 2009, all three measures of farm sector earnings experienced a rapid rebound and are forecast to rise in 2010.”
• Net cash income is expected to rise more than 23 percent to $85.3 billion — the second highest on record and above its previous 10-year average.
• Net farm income has rebounded, up 24 percent from 2009, when demand for agricultural products fell worldwide due to the global recession.
• Net value added, at $127.3 billion, is expected to be up $15.2 billion from 2009, and remain 17.7 percent above its 10-year average.
“Other indicators also point to a sustainable recovery. Farm asset values are projected to increase by 2.5 percent in 2010, as are equity values. And average farm family household income is projected to reach more than $81,000 in 2010 — up 5.8 percent from 2009.
“And this recovery is sector-wide. While an increase in the value of livestock production accounted for much of the upward movement, the value of dairy production rose by 26.2 percent, the value of meat animal production is up 14.6 percent, and the value of poultry and egg production rose 8.4 percent. And commercial farms and intermediate farms are all expected to have higher average net cash income in 2010 than they did in either 2009 or 2008. Rural residence farms will have lower net cash losses.
“A host of factors contributed to this strong and rapid recovery. Successful implementation of the 2008 farm bill … as well as the Obama administration’s Recovery Act have provided strong support for American agriculture.
“We have maintained a strong safety net for the agricultural economy by providing farmers and ranchers across America with direct support, disaster assistance, technical assistance, support to struggling industries, and access to credit. At the same time, we worked to build a stronger agricultural economy for future generations of Americans by investing in research, maintaining fair markets, and promoting marketing policies that will keep American agriculture the most productive and successful in the world.
“Another factor driving this recovery is an increase in income from exports. Today, USDA is excited to announce that we are raising our forecast for agricultural exports for fiscal 2010 to $107.5 billion — the second highest year on record. This a $3 billion increase from the May forecast, and an $11 billion increase over last year. And Agriculture is one of the only major sectors of the American economy with a trade surplus — expected to be $30.5 billion this year.
“What’s more we expect to sustain this important progress. The outlook going forward into fiscal 2011 is even more promising, showing $113 billion in agricultural exports.
“Increased agricultural exports — especially of grains and meat — have helped drive this rebound. It helps create important income opportunities for producers as well as the off-farm jobs that are so critical for strengthening economies in rural America. In fact, every billion dollars in agricultural exports supports over 8,000 jobs and generates an additional $1.4 billion in economic activity.
“And USDA — as part of President Obama’s National Export Initiative — has helped support these export numbers:
• The president’s fiscal 2011 budget proposal for USDA makes an additional financial request to enhance USDA export promotion activities.
• And USDA has made strong progress to help increase exports. Under a new trade strategy, we are looking at countries based on their position on an agricultural market continuum.
• As we pursue this new approach, we have maintained our commitment to an open rules-based international trading system that will benefit both consumers and suppliers of agricultural products around the world. We have continued to work through negotiations to remove barriers that prevent U.S. agricultural producers from getting open and fair access to foreign markets. And because we have full confidence in their quality and competitiveness, we will continue to push U.S. products to foreign markets.
“And we can’t forget the importance of the underlying values of rural America and its farmers and ranchers to the resilience of the agriculture sector:
• American agriculture entered the recession with very little debt relative to the rest of the economy — and farm sector debt is expected to decrease in 2010;
• A strong belief in the value of hard work positioned our farmers to capitalize on the economic recovery; and
• American agriculture has improved on its incredible productivity and adaptability — embracing new research and innovation like few other sectors of the American economy.
“From day one, the Obama administration has focused on reversing nearly a decade’s worth of failed economic policies that helped to cause the worst recession since the Great Depression. We’ve taken steps to move the economy forward and get our people back to work while rebuilding a strong economic foundation to ensure future prosperity.
“As the rest of the American economy climbs out of the recession, American agriculture is helping lead the charge. As they have time and time again, American farmers and ranchers are stayed resilient and working to support a foundation of economic prosperity for the rest of the nation.”