USDA released its closely-watched September farm-income forecast projecting net farm income at $158.4 billion in 2026, down $4.3 billion from 2025.
After inflation, the decline is considerably larger, $9.1 billion, or 5.5%.
Perhaps more significant for producers is the sharp increase in expenses.
USDA expects production costs to reach $492.8 billion, up $21.2 billion, or 4.5%.
Fertilizer, fuel and livestock purchases account for much of the increase.
Meanwhile, direct government payments are forecast at $47.4 billion, $19.5 billion above 2025.
Farm-sector debt is also projected to reach $605.1 billion, up 4.6%.
The numbers illustrate the continuing margin squeeze facing producers despite stronger gross revenues in portions of agriculture.
