With good times in the farm sector, the value of farm assets would climb 10% this year, following a 10% increase in 2021 — the No. 2 year for farm income — said the USDA in its Farm Income forecast, issued three times a year. Farm debt would climb more slowly, and the debt-to-asset ratio, a measure of financial health, would drop to 13.05%, its first decline since 2011.

Crops and livestock will generate $541.5 billion in cash receipts, up 24%, or nearly $106 billion, from last year. Almost all of the increase, $96.8 billion, would be the result of higher prices, calculated USDA economists. Corn, wheat, and soybean would fetch an additional $37 billion this year compared to last. Higher broiler chicken prices would boost receipts by 55%. Revenue from cattle, hogs, turkeys, and milk also would climb. “Cash receipts for chicken eggs are expected to more than double,” said the USDA.

Commodity prices boomed with the return of China to the U.S. market in fall 2020, and they surged again after the Russian invasion of Ukraine last February. The invasion disrupted grain and fertilizer exports from the Black Sea region. Ukraine and Russia are major wheat exporters, and Russia leads in fertilizer exports.

Farm production expenses were forecast to rise 18%, to a record $442 billion this year. “This would represent the largest year-to-year dollar increase in nominal terms on record,” said the USDA. Nearly every category of expense would go up. Fertilizer, lime, and soil conditioners would increase by 47%, fuel and oil by nearly 48%, interest costs by 41%, and livestock feed, the largest category, by 17%.

Farm groups have focused on the rise in expenses and have asked lawmakers, with a new farm bill to be written in 2023, for higher reference prices, a factor in calculating crop subsidies, and more protection through the government-subsidized crop insurance program.

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 Some 77.1% of growers keeping pasture said they’d purchased shortline equipment from a dealership outside of their primary dealer, the highest percentage by commodity grown. Corn growers are the least likely to buy shortline equipment from a secondary dealer at 71.2%. Growers keeping pasture were again the most likely to purchase parts from a secondary dealership. Here, 78.7% of growers keeping pasture said they had, while soybean and winter wheat farmers were the least likely to have purchased shortline parts from another dealer at 68.1%. Hay/alfalfa growers led the way in having service done on shortline equipment from other dealers at 49%.

Reasons to Purchase Shortline vs. Major-line.

When asked for their primary reason to purchase a shortline brand of equipment over a major-line brand, growers who indicated they keep pasture were the most likely to prioritize the price of the equipment, with 50.5% choosing that option. Winter wheat farmers were the least likely to prioritize price at 36.6%. The second-most popular reason was the lack of a comparable product from the majors, which was led by corn growers at Br24%. Winter wheat farmers were the least likely to consider this reason at 21.4%. Manufacturer experience in a niche area — overall the third-most popular reason to purchase shortline equipment — was most popular with winter wheat growers at 21.4%, almost triple the 7.4% of growers who keep pasture. Winter wheat growers were the most likely to forego major-line equipment due to a lack of specialization at 11%, while corn growers were the least likely to consider this reason at 7%.

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