By Blake Jackson
Kentucky's agricultural economy, projected to see a modest 3.3% rise in cash receipts for 2024, is nearing a record $8.3 billion, though challenges loom for 2025.
Economists from the University of Kentucky’s Martin-Gatton College of Agriculture, Food and Environment caution that rising costs, geopolitical uncertainties, and reduced government support will impact farmers.
“While Kentucky crop receipts are forecast to fall by nearly 13% in 2024, we are projecting that Kentucky livestock receipts will increase by around 17% this year,” said Will Snell, a professor in the Department of Agricultural Economics. “Consequently, our estimate of Kentucky ag cash receipts for 2024 may challenge the record high level of $8.3 billion recorded in 2022.” Official 2024 data will be published by USDA next September.
Net farm income (NFI), however, is expected to decline due to higher production costs and lower commodity prices. Jerry Pierce, coordinator of the Kentucky Farm Business Management Program (KFBM), remarked, “This current cycle saw NFI peak in 2021, with a steady decline over the last two years as commodity prices have softened and costs have surged.”
Row crops, particularly corn, soybeans, and wheat, continue to struggle under low prices and oversupply. Assistant professor Grant Gardner noted, “Inflation-adjusted prices are near an all-time low, creating a tough outlook for the foreseeable future.”
Livestock remains a bright spot, with tight national cattle supplies driving prices higher. Kenny Burdine, an extension specialist, highlighted the significance of these trends:
“The U.S. cowherd is at a 63-year low, and that tight supply has supported strong cattle prices in Kentucky.” Poultry and dairy sectors also performed well in 2024, with favorable conditions aiding production and profitability.
Specialty crops and greenhouses contributed over $200 million in cash receipts despite weather challenges. Meanwhile, forestry and tobacco sectors continued to face declines, with reduced demand and industry attrition.
Looking ahead, Kentucky farmers face uncertainties tied to grain markets, policy developments, and global conflicts. “The potential for increased tariffs raises questions about the impact on U.S. competitiveness,” Snell said. Resilience and adaptability will remain key for Kentucky’s agricultural community in navigating the year ahead.
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Categories: Kentucky, Business