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Farm income forecast to drop 3.3 percent

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Net farm income is expected to be $114 billion this year, down 3.3 percent from last year, and net cash income is forecast at $132.8 billion, down 1.4 percent, the Agriculture Department’s Economic Research Service said in a farm income forecast released today.

But because 2011 was a record year, both income measures are high by historical standards, the ERS noted.

“Despite gains in almost all sources of farm income, large increases in farm expenditures, especially for purchased feed, have more than wiped out those price-led gains to farm income,” the report said.

Agriculture Secretary Tom Vilsack called the forecast “heartening,” but said it is a reminder that Congress needs to pass a new farm bill before the end of the calendar year.

The report “confirms that American farmers and ranchers remained impressively resilient in 2012, even with tough odds due to one of the worst droughts in more than a generation,” Vilsack said.

“While down slightly from the August forecast, today’s estimates for net farm income are the second-highest since the 1970s, while total farm household income is expected to rise,” he said.

“At the same time, the positive trend of falling debt ratios continues,” he said. “The forecast suggests that strong farm income should remain a positive factor in carrying farmers and ranchers into the 2013 growing season. But as one season comes to an end and another lies on the horizon, we must continue to stand with America'’ farming families and rural communities, providing help and assistance to those who need it.”

“This year, the farm safety net showed its mettle and merit, helping to deliver peace of mind to thousands of farmers and ranchers dealing with losses caused by natural disasters,” Vilsack said.

“It’s a reminder that Congress must do the same, and pass a comprehensive, multi-year food, farm and jobs bill that provides greater certainty for farmers and ranchers in the season ahead. Providing the tools and certainty they need is the least we can do for those who grow our food, fiber, feed and fuel, even through the most challenging of times.”