88 



8 

 years and should continue to do so in 1993. Net cash farm income 

 plateaued in 1988-92 but at a record high $58-61 billion. This 

 income strength reflected a combination of rising receipts, 

 relatively stable farm production expenses, and lower but stable 

 government payments. In 1993, net cash farm income is projected 

 to be between $58 and $64 billion. 



The income and finance picture is incomplete unless we 

 account for off -farm income. On average, off -farm income has 

 grown to roughly half of the total farm household income. For 

 small operations, off-farm income often accounts for virtually 

 all of their total household income. Off-farm income is also 

 important for larger operators, although it typically accounts 

 for a small proportion of total household income. Including off- 

 farm income, average farm household incomes approximate those in 

 the rest of the economy. 



Agriculture's general financial position reflects the 

 overall income trends. Total farm asset values and farm debt , 

 have changed little since 1990, but remain much improved from the 

 mid-1980's. 



During the 1980 's income and particularly asset values fell 

 sharply, leaving farmers with large debt burdens relative to the 

 assets pledged as collateral and to the cash available to service 

 debt. The proportion of farm borrowers who had their loans 

 called, who were loaned up to the limit, and who went out of 

 business or filed for bankruptcy rose. At the peak of the 

 mid-1980 's financial crisis, USDA estimated that over 10 percent 

 of all farm businesses were vulnerable to bankruptcy; their 



