The equine industry had another steady year and accounted for 17% of Kentucky's sales receipts in 2016. | Photo: iStock

A significant decline in cash receipts over the past couple of years, plus the end of tobacco buyout payments in 2014, have been the major reasons behind the rapid fall in Kentucky’s net farm income since peaking at nearly $3 billion in 2013.

The state’s agricultural cash receipts in 2016 are projected to fall to $5.4 billion, off 7% from $5.8 billion in 2015 and off 17% from the record high of $6.5 billion in 2014. On the national front, prices and incomes fell for the third straight year.

“2016 has been another challenging year for Kentucky agriculture with considerable price and weather volatility,” said Will Snell, Extension professor in the University of Kentucky (UK) Department of Agricultural Economics. “Price and profit challenges will remain a major concern heading into 2017 in the midst of ample commodity supplies, a strengthening U.S. dollar, and sluggish global economic growth. However, assuming there are no major supply or demand shocks, net farm income for Kentucky farmers may show signs of stabilizing in 2017 as the global markets work off excess supplies and global economies begin to show some modest growth