Some individuals support giving farmers money became farm income is unstable. Farm income tends to be unstable because the demand for some farm products is not very sensifive to changes in prices. When demand for a product is not very sensifive to changes in price, changes in supply will result in large changes in price. If there is an increase in supply, there will be a large drop in price and farmers' revenue will decrease. Changes in weather can cause frequent changes in the supply of agricultural products, thereby leading to the instability of farm income.
Income can also be unstable because of the intense competition faced by farmers.
If farmers introduce a new crop, they may reap economic profits due to the risk associated with bringing a new product to market. Over time, the economic profits will be competed away as new suppliers enter the market. The economic profits are competed away because of the decrease in price that accompanies increases in supply and because of the fact that marginal cost increases as output is expanded. Government has attempted to decrease risk by regulation, by reducing price and income risk, and by providing disaster relief. Economic analysis shows that government intervention in these areas is unnecessary.