Farm Prices and Farmers' Income

Report Outline
Estimated Income from This Year's Crops
Provisions of the Agricultural Adjustment Act of 1938
The Farmers' Share of the National Income
The Relation of Agriculture to National Prosperity
Special Focus

Estimated Income from This Year's Crops

Cash income of farmers in the United States from the sale of farm products and government payments will be about $7,625,000,000 this year, according to the most recent estimate by the Bureau of Agricultural Economics. This compares with $8,600,000,000 in 1937 and $7,944,000,000 in 1936.

The index of prices received by farmers for their products stood at 95 (1909–1914 average equals 100) on October 15, as against 112 for the same date in 1937. On the same basis, the index number of all prices paid by farmers as production and living expense was 121 on October 15 of this year and 128 on October 15, 1937. A drop of 17 points in the prices of farm products has been accompanied by a drop of only 7 points in the prices paid by farmers for things they have to buy.

Of the five commodities for which specific provision was made in the Agricultural Adjustment Act of 1938, only tobacco is now selling for more than the “parity price” which it was the declared purpose of the act to secure and maintain. Wheat is selling for less than half of the parity price, and corn, rice, and cotton for only a little more than half of parity. Marketing quotas to keep at least part of the surplus from the market are in effect for tobacco and cotton.