(Adds details on cash receipts, background and byline)
By Karl Plume
Nov 30 U.S. net farm income is expected to drop
for a third consecutive year in 2016, sinking 17.2 percent to
$66.9 billion due largely to weak returns for livestock, dairy
and poultry farms, the U.S. Department of Agriculture said on
The updated forecast from the agency's Economic Research
Service (ERS) was down from its August forecast of $71.5 billion
and down 46 percent from record profits for the sector of $123.7
billion in 2013.
If realized, the income would be the lowest since 2009,
according to the ERS, signaling pressure for the slumping farm
The weakening farm economy has triggered cost cutting and
job reductions at major farm input providers like seed and
chemicals company Monsanto and equipment maker Deere
, both of which reported lower revenues in fiscal 2016.
Meat processor Tyson Foods this month reported a
steep drop in sales and forecast further headwinds into 2017.
Cash receipts for producers of animals and animal products -
including dairy, beef, pork, poultry and eggs - are projected to
fall 12.3 percent to $166.4 billion this year, the lowest since
2011, ERS data showed.
Chicago Mercantile Exchange lean hog futures plunged
by nearly 41 percent in the third quarter, the steepest
quarterly decline on record, as cheap feed grains encouraged a
much-expanded hog herd. CME live cattle fell 18 percent
in the quarter, also the largest drop on record, as beef faced
stiff competition from abundant supplies of cheaper pork and
Row crop farming cash receipts were seen unchanged at $186.5
billion as stronger returns for soybean and cotton producers
were offset by declines for corn and vegetable farmers.
Chicago Board of Trade corn and soybeans have
each notched new seven-year lows in 2016 as a record-large U.S.
harvest swelled global supplies.
(Reporting by Karl Plume in Chicago; Editing by Chizu Nomiyama
and Tom Brown)