The U.S. economy is poised to slow in 2022 relative to 2021, but economic growth will continue at an above-average pace. CoBank last week released its 2022 year ahead report, examining several key factors that impact agriculture and market sectors that serve rural communities. CoBank suggests the U.S. farm economy will continue to struggle with the ongoing supply chain dysfunction and cost inflation issues that emerged in the summer of 2021. Historically strong prices will be more than offset by increases in cost structure for nearly all crop production, including row crops, fruits and vegetables, and hay. CoBank economists do not anticipate any significant pullback in farm-level costs until the fall of 2022, at the earliest. The expected decline in direct government payments in 2022 will further squeeze farm income statements. The single biggest wildcard for U.S. agriculture is export sales to China, currently the largest export market for U.S. farm products.
CoBank Releases 2022 Year Ahead Economic Report