Use of Funds Remains Relatively High on Illinois Farms

By Gary Schnitkey and Nick Paulson et.al

Incomes on Illinois grain farms in 2024 were lower than in any other year since the early 1990s (see farmdoc daily, December 2, 2025). In this article, we compare three primary uses of funds to the sum of farm and non-farm income. Two major uses of income – machinery and building purchases and family living withdrawals – have exceeded historical levels relative to farm income. Non-farm income remains an important source of stability for many Illinois farms, buffering the large swings in farm income.

Incomes and Uses of Funds

We summarize the sources and uses of funds for all farms enrolled in Illinois Farm Business Farm Management (FBFM) that track sources and uses of funds, including family living expenditures. Not all farms enrolled in FBFM track sources and uses. Moreover, farms must be sole proprietors to be included in this summary. Still, in recent years, over 1,300 farms have tracked sources and uses and been certified as complete and accurate by FBFM field staff. Use of this data enables consistent tracking of income with fund use. In 2024, the average age of farmers included in the analysis is 58 years. Age has trended up over time. The average number of family members is 2.5, which has trended down over time.

We state all sources and uses on an operator acre basis. An operator acre represents the number of acres from which a farm receives revenue. Owned and cash rented acres count as full operator acres. One acre that is share-rented, with the farmer receiving 50% of the revenue, counts as 0.5 operator acres. There was an average of 883 operator acres in 2024.

Sources of Funds

Significant sources of funds on most farms are net farm income and non-farm income (see Figure 1). Over time, average non-farm income has increased from $18 per operator acre in 1993 up to $73 per acre in 2024.

As one would expect, there has been a great deal of variability in net farm income on a per operator acre basis. That variability follows the usual patterns (farmdoc daily, December 2, 2025). From 1993 to 2004, net farm income averaged $77 per operator acre. During the ethanol build, net farm income increased, reaching a high of $356 per acre in 2012. Farm income then fell, averaging $80 per operator acre from 2015 to 2019. Income then increased for a variety of factors, including short supplies of crops in major producing areas, ad hoc payments associated with COVID, and supply disruptions caused by the Ukraine-Russia war. Income hit a high of $451 per operator acre in 2022 Since 2022, net income has declined, reaching a low of $9 per operator acre in 2024.

Uses of Funds

Selected use of funds is shown in Figure 2 on a per operator acre basis. Figure 2 also shows a dotted line that represents the sum of net farm income and non-farm income, combining the two series in Figure 1. The sum follows changes in net farm income, but is significantly higher because of the inclusion of non-farm income. On average, non-farm income acts as a large buffer for many farms in Illinois.