On the latest edition of Field Day, Ohio Farm Bureau’s Director of Water Quality and Research Jordan Hoewischer talks with Barry Ward, assistant professor with OSU Extension, leader production business management and director of OSU income tax schools, as well as a part-time grain farmer in Champaign County.
They are joined by Jack Irvin, OFBF senior director of state and national policy. The three talk about the overall farming outlook and the ripple effect of the federal tax reform package, which could potentially save farmers thousands of dollars at a time when the Ohio agricultural economy is slumping.
“USDA is projecting about a 7 percent drop in net farm income for this year,” Irvin said. “That’s going to be the lowest farm income we’ve had in 12 years. So, going all the way back to 2006, and to kind of put that in perspective from our peak in 2013, that’s a $64 billion drop in farm income. So, I don’t think as a whole we fully appreciate the significant dollars that have left the farm economy.”
Field Day with Jordan Hoewischer is an ongoing series of conversations with experts and leaders who are helping to shape and secure the future of Ohio’s ag industry for generations to come.
Following are some highlights from Episode 5. A transcript of the conversation can be found here.
Q: A major federal tax reform bill was recently passed. How might that impact the ag sector? How are the tax laws in general impacting producers this year?
A (Ward): It’s going to be incumbent upon all of us to really educate ourselves and look at all the different repercussions. We’re studying things right now to see what strategies farmers might employ in this year and in the following years to really manage their tax burden as well as they can. It’s one of those things where there’s going to be all kinds of moves and changes going on at the business level to try to find that strategy that’s going to best suit a business.
NOTE: An American Farm Bureau impact comparison between 2017 and 2018 following the passage of federal tax reform legislation can be found here.
Q: What is your feeling about the (farm economy) cycle we’re in? When we’re in a downward trend or upward trend, it always seems a little bit either bleak or the upward trend seems like it’s going to extend. What is your feeling on where the trend is going?
A (Ward): I think we’re kind of more in the new normal. We’re certainly not going to see a period anytime soon, in my opinion, like we did from ’06 through ’12 or ’13 where we had corn and soybean prices that really were extremely high and margins were high. I think we’re more in for a period for the next four or five years that’s going to look a lot like this one.