USDA’s early projection for net farm income is $111.4 billion for 2021, a decline of $9.8 billion from 2020. American Farm Bureau Federation Chief Economist John Newton isn’t surprised with the expected decline. “Most folks anticipated we’d see a decline, but the decline wasn’t as steep, because of the higher crop prices.” Last year, ad-hoc government payments were a big part of the story. That’s not expected to be the case this year with a forecast 45 percent drop in ad-hoc payments. There will, however, be the additional coronavirus aid. Also contributing to the farm income decline in 2021 net farm income is higher production expenses. USDA is forecasting total production expenses to increase 2.5 percent to more than $353 billion. Newton said more needs to happen for USDA’s farm income forecast materialize; this is a very early projection. Hear the story.