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The sound financial health of the U.S. farm sector is vital because of its importance to food security and for the wellbeing of U.S. farm households and rural communities. Analyzing key financial ratios is one way to examine the financial health of the farm sector. This study compares 2020 values for farm sector financial ratios before and after the onset of the Coronavirus (COVID-19) pandemic. Forecasts from the February 5, 2020, release of the USDA Economic Research Service’s Farm Income and Wealth Statistics data product represent the prepandemic (before) forecasts. Those forecast values are compared to the data released on February 4, 2022, which represent the realized values for 2020 and include pandemic impacts on commodity demand and the policy response to the economic shock. Solvency ratios (which are indicators of the sector's ability to repay financial liabilities via the sale of assets) worsened in 2020 relative to prepandemic expectations. Efficiency ratios (which evaluate the conversion of assets into production and revenue) and liquidity ratios (which are indicators of the availability of cash to cover debt payments) showed mixed outcomes for the realized results in 2020 relative to the pre-pandemic forecasts. Four profitability ratios were stronger in 2020 relative to pre-pandemic expectations. All solvency, liquidity, and profitability ratios plus 2 out of 5 efficiency ratios for 2020 were weaker than their respective average ratios obtained from 2000 to 2019 data.

Presentation 20303

Presentation 20558

Off-farm income—such as pensions, investment income, or wages and salary from an off-farm job—is an important source of total income for U.S. farm households. In 2019, 96 percent of farm households derived some income from off-farm sources. On average, off-farm income contributed 82 percent of total income, or $101,638, for all family farms in 2019. Smaller farms tend to rely more on off-farm income than larger farms. On average, small family farms, those with an annual gross cash farm income (GCFI) under $350,000, derived more than half of their total household income from off-farm income in 2019. By comparison, on average, very large farms, those with a GCFI of $5 million or more, earned 7 percent of their total income from off-farm sources that year. However, those are averages, and some households operating small farms rely primarily on farm income, while some households operating larger farms rely on income from off-farm sources.

Multiple USDA programs disburse payments to farm operations each year. Payments to farm operators totaled $14.8 billion in 2019, based on data from USDA’s Agricultural Resource Management Survey. More than 30 percent of about 1.97 million U.S. farms received some government program-related payments that year, with an average payment of $24,623.

Presentation 20488

The Coronavirus (COVID-19) pandemic caused disruptions to the U.S. agriculture sector, including a decline in commodity prices in the first half of 2020. To mitigate the effects of the pandemic, Congress passed six economic relief and stimulus bills in 2020. One bill authorized USDA to create the Coronavirus Food Assistance Programs (CFAP 1 and CFAP 2), which provided direct payments to farm operations. Other Federal departments and agencies created broader programs from which both farm operations and family farm households were eligible to receive assistance. For example, the U.S. Small Business Administration’s Paycheck Protection Program (PPP) offered forgivable loans, and the Economic Injury Disaster Loan Program (EIDL) provided forgivable advances. Most family farm households were also eligible for Economic Impact Payments (EIP), administered by the Internal Revenue Service (IRS). And family farm households that lost off-farm wages were eligible for the Federal Pandemic Unemployment Compensation (FPUC) administered by the U.S. Department of Labor.

Presentation 20341

On March 13, 2020, the U.S. Federal Government declared a national emergency based on the novel coronavirus (COVID-19) pandemic. The Government’s response included providing assistance programs related to the economic impacts of COVID-19. This study estimates the total direct Government assistance to farm operations and farm households in calendar year 2020 from COVID-19 related programs, the Market Facilitation Program (MFP), and other existing Farm Bill (FB) programs. The insights from this study supplement the triannual U.S. Department of Agriculture (USDA) Economic Research Service (ERS) farm income forecasts by providing stakeholders more forecasting details, including information regarding the distribution of Federal payments and eligibility. This working paper further documents methodologies relevant for a timely update of similar payments in the future. Using data from the Small Business Administration, Bureau of Labor Statistics, and multiple sources within USDA, we find $57.7 billion in total financial assistance was provided to farm operations and households in calendar year 2020. Programs specifically designed to address the economic impacts of COVID-19 in 2020 delivered an estimated $35.2 billion, the assistance provided under non-COVID-19 related programs (other than net indemnity payments) delivered an estimated $16.8 billion, and the net indemnity payments provided the remaining $5.7 billion

Presentation18713

USDA’s Agricultural Resource Management Survey (ARMS) is the primary source of information on the production practices, resource use, and economic well-being of America’s farms and ranches. ERS recently released a new ARMS data dissemination tool that allows for more user interaction, includes charting capability, and has an application program interface (API) for direct queries.

A notable characteristic of principal farm operators, the person most responsible for running the farm, is their relatively advanced age. In 2016, 36 percent of principal farm operators were at least 65 years old, compared with only 14 percent of self-employed workers in nonagricultural businesses. Older operators ran 37 percent of all small family farms.

Rural tourism is a rapidly expanding industry in Europe and America, experiencing an annual growth rate of six percent in recent past. The steady increase in rural tourism can help minimize the large gap between average rural income and average urban income. An issue Texas Department of Agriculture (TDA) faces in funding rural community events is whether these events will generate sufficient aggregate economic impact (AEI) to justify this public investment. The GO TEXAN Rural Community Program is a comprehensive program initiated by the TDA to enhance the growth and prosperity of rural Texas towns, cities and counties. Using panel data this study develops a predictive model that explains variables that affect aggregate economic impact of rural events, where visitors spend their money based on the events' attractiveness. AEI is an important measure of the effectiveness of TDA funding of rural communities. It is calculated based on event and community characteristics and it is the total expenditures for a particular event multiplied by economic multiplier. We evaluated the total returns from 39 community events and seek to determine to what extent outcomes could have been predicted based upon available information. Event surveys from three consecutive years 2008, 2009 and 2010 are used as primary data. The results reveal that the Ordinary Least Square (OLS) is a good fit for the model. Parameters coefficients of the explanatory variables such as event days, number of years, community investment, weather, folk/music, nature tourism, estimated miles, distance from major city, visitor rating, community population and median family income were statistically significant.