Agriculture Policy News

Can USDA's New Great American Cotton Plan Revive Demand?

Fri, 29 May 2026 16:44:23 GMT

The Trump Administration is rolling out what it calls a major reset for the U.S. cotton industry, unveiling the “ Great American Cotton Plan, ” a USDA initiative designed to boost demand for American-grown cotton, strengthen domestic textile manufacturing and make U.S. cotton more competitive globally.

Announced Thursday by U.S. Secretary of Agriculture Brooke Rollins in Arizona, the plan comes as cotton producers face a fifth straight year of negative returns amid rising production costs, synthetic fiber competition and shifting export markets.

While the Rollins says the plan is aimed at rebuilding the U.S. cotton industry, it includes several key points, including:

Makes U.S. cotton cheaper and more attractive for apparel brands to use — even if manufacturing happens overseas
Supports the bipartisan Buying American Cotton Act to incentivize brands to source American-grown cotton
Encourages mills and manufacturers to build more U.S.-based textile supply chains
Expands the “Plant Not Plastic” campaign promoting natural fibers over synthetic materials
Increases textile mill payments from 3 cents to 5 cents per pound of cotton processed
Prioritizes cotton processors and textile manufacturers for USDA loan programs
Expands export opportunities for U.S. cotton through new trade commitments
Raises cotton marketing loan rates and increases the seed cotton reference price for farm programs
Expands crop insurance tools and research efforts to protect cotton growers

“This change starts today,” Rollins said in announcing the initiative, which ties together trade policy, manufacturing incentives and consumer marketing aimed at increasing cotton use both domestically and abroad.

The Great American Cotton Plan is about one thing: Putting American cotton first again.

Real “_____” wear cotton. 👖🌱

Americans. Cowboys. Farmers. Families. MAHA. Because cotton is real, natural, American-grown, and made by U.S. farmers.

Here’s the plan 👇

✅ Promote… pic.twitter.com/PkzvY9nHBb
— Secretary Brooke Rollins (@SecRollins) May 28, 2026

“The Trump Administration is committed to ensuring American cotton once again becomes the fiber of choice with the Great American Cotton Plan, a bold effort to restore profitability for cotton producers, strengthen rural economies, rebuild domestic textile manufacturing, and bring American cotton back into the products families use every day.”

Rollins made a strong tie to the Make America Healthy Again (MAHA) movement, saying supporting natural fibers like cotton aligns with the administration’s focus.

Yes: plant, not plastic. Proud to support @USDA, @SecRollins, and the Great American Cotton Plan. American-grown cotton supports our farmers, strengthens rural communities, fuels U.S. manufacturing, and gives families a natural alternative to synthetic, plastic-based materials.… https://t.co/tuFsc6fLDb
— Secretary Kennedy (@SecKennedy) May 28, 2026

For the National Cotton Council, the announcement represents more than short-term assistance. Robbie Minnich, vice president of Washington and operations for the National Cotton Council, says the broader goal is to help the cotton industry regain long-term financial stability instead of relying solely on farm safety net programs.

“This is a plan that really a lot of us in the industry have been working on with USDA,” Minnich says. “Cotton farmers are in their fifth year of negative net returns. How do we address that and what can be done? The farm bill programs are super important as a safety net ... but more holistically, how do we get the industry back on good footing so we’re not as reliant on those programs?”

Making U.S. Cotton More Competitive

It’s no secret the cotton industry has been in peril the past five years, largely due to a dramatic cut in demand. Cotton prices have improved over the past two months, but the longer-term concerns about cotton are tied to demand.

Just last year, cotton farmers were talking about not just losing money, but losing the farm . And to start the year, things looked even more bleak with the possibility of more farmers forced to exit the business this year. The main reason? Demand for synthetic fibers had overtaken demand for cotton.

But a central goal of the plan announced this week is to make American cotton more attractive and affordable for textile brands, even if final products are manufactured overseas. USDA officials say the strategy is designed to lower costs for mills using U.S. cotton while rewarding companies that can trace and verify American-grown fiber in their supply chains.

One key piece is continued support for the bipartisan Buying American Cotton Act , legislation intended to create tax incentives for companies using U.S. cotton in textile products. Industry supporters say the measure could encourage apparel brands to source more American cotton while giving textile mills a financial reason to expand U.S.-based supply chains.

Minnich calls the Buying American Cotton Act, often referred to as BACA, the industry’s top priority.

“At the end of the day, we’ve got to build demand,” he says. “The Buying American Cotton Act can do that. It will do that.”

The National Cotton Council thanks @RepCiscomani for hosting @SecRollins and @SBA_Kelly for today’s roundtable discussion and announcement of The Great American Cotton Plan. pic.twitter.com/WCxnMN9N3h
— NatlCottonCouncil (@NCottonCouncil) May 28, 2026

He says the legislation could become a “true game changer” if brands begin requiring U.S. cotton in sourcing decisions for large-scale apparel production.

“When they make their supply decision and say, ‘I want that million pair of cotton khaki pants, and you have to make it with U.S. cotton,’ I think that’s going to be a true game changer for our industry,” Minnich says.

The plan also increases payments through the Economic Adjustment Assistance for Textile Mills program from 3 cents to 5 cents per pound of cotton processed, a move aimed at improving profitability for domestic mills and processors.

At the same time, USDA says cotton processors and textile manufacturers will receive priority consideration through Rural Development’s Business and Industry Guaranteed Loan Program to help expand domestic production capacity.

Rebuilding Domestic Manufacturing

The announcement underscores growing concern over the decline of the U.S. textile industry.

According to USDA, the number of cotton gins in the United States has fallen from 2,254 in 1980 to just 446 today, while domestic textile manufacturing capacity has steadily shrunk over the last two decades.

The administration argues rebuilding more of the supply chain domestically could help stabilize demand for cotton producers while supporting rural jobs tied to processing, manufacturing and transportation. USDA estimates every $1 generated at the cotton farm gate creates roughly $15 in economic activity across related industries.

The Great American Cotton Plan puts farmers first. 🚜🇺🇸

Through the Working Families Tax Cuts Act and targeted policy wins, the Trump Administration is reviving the U.S. cotton sector, supporting rural communities and lowering costs on everyday essentials.

Here’s how we're… pic.twitter.com/vHuO65JDjx
— Dept. of Agriculture (@USDA) May 28, 2026

Minnich says the administration’s focus on domestic textile production also has national security implications.

“When you think about America 250 and everything our country’s been through, our men and women in uniform, we’ve got to have the ability to make their uniforms,” he says. “We don’t want to be relying on another country for that.”

Positioning Cotton Against Synthetic Fibers

Another major theme of the initiative is promoting cotton as a natural alternative to synthetic fibers.

USDA and HHS are expanding the administration’s “Plant Not Plastic” campaign, which encourages consumers to choose natural fibers over petroleum-based synthetic materials such as polyester.

The campaign originated with the National Cotton Council and has become a growing part of the industry’s messaging strategy.

Minnich says consumer awareness around synthetic fibers and microplastics remains low, despite growing research into microfiber pollution.

“A lot of people just don’t realize,” he says. “If it’s not natural fibers, if it’s not cotton, and it’s synthetic plastic, well, I’m basically feeding my kid plastic.”

The administration says the effort aligns with broader “Make America Healthy Again” priorities, citing concerns about microplastics and synthetic materials in consumer products.

Today, USDA estimates nearly 70% of the world’s textile fibers are synthetic.

Officials say promoting cotton’s biodegradability, breathability and moisture absorption could help drive additional consumer demand for natural fibers.

Minnich says the administration had already begun emphasizing microplastics and synthetic fibers before the formal cotton plan announcement, pointing to EPA and HHS efforts examining the impacts of synthetic materials.

“I do think it’s more of a concerted effort to make sure that we’re promoting natural fibers,” he says.

Trade and Export Expansion

The plan also includes efforts to strengthen export opportunities for U.S. cotton after the United States lost its position as the world’s top cotton exporter to Brazil in 2023.

USDA says recent trade commitments secured with Indonesia and Bangladesh are expected to support additional purchases of U.S. cotton and textile production using American fiber.

Cotton Council International also participated in a USDA Agribusiness Trade Mission to Indonesia earlier this year for the first time.

The administration says those efforts will complement existing export promotion programs, including the Market Access Program and COTTON USA licensing initiatives.

Support for Growers

Beyond demand-building efforts, USDA says the plan includes several provisions intended to improve grower profitability and risk protection.

Those include higher marketing loan rates for cotton, expanded insurance access through the Supplemental Coverage Option program and a 14% increase in the seed cotton reference price for ARC and PLC programs beginning in fall 2026.

Minnich says many of those policy improvements were included in last year’s Working Families Tax Cut Act, but producers are still waiting to see some of those changes fully implemented.

“As producers see that base update, as they see the marketing loan changes and the benefits to that, as the ARC and PLC payments come out in October, I think that’s when they really start to go, ‘All right, wow, this is making a difference to my operation,’” he says.

USDA estimates cotton producers could lose approximately $2.6 billion across 9 million planted acres during the upcoming crop year, highlighting the financial pressure facing the industry.

For growers, the broader hope behind the Great American Cotton Plan is that stronger domestic demand, expanded export opportunities and more integrated supply chains could eventually help restore profitability across the cotton sector.

Still, Minnich says the next major step will be congressional action on the Buying American Cotton Act.

The legislation currently has bipartisan support in Congress, with more co-sponsors continuing to sign on.

“We just got to add more,” Minnich says. “Whether you’re a cotton person or a person that cares about microplastics and the environment and what you and your children wear, call your member of Congress and encourage them to support it.”

Can the Plan Save the U.S. Cotton Industry?

After five consecutive years of negative returns, many in the cotton industry say the stakes are high.

Minnich says the long-term success of the Great American Cotton Plan will ultimately depend on whether Congress passes the Buying American Cotton Act and whether brands begin making sourcing decisions around verified U.S. cotton.

“If we can implement it, and part of that overall goal being getting BACA passed through Congress and signed into law by the president, and starting to see those brands and retailers whenever they make their supply decision say, ‘I want that million pair of cotton khaki pants, and you have to make it with U.S. cotton,’ I think that’s going to be a true game changer for our industry,” he says.

Former Chief Ag Trade Negotiator on Uncertainty Around China: “No Doubt, We Have a Deal”

Fri, 22 May 2026 13:31:50 GMT

The question hanging over U.S. agriculture this summer is no longer whether Washington and Beijing are talking again. The question is whether the latest agreement between the two countries will turn into real business for American farmers and when that could happen.

The White House announced on Sunday that China will purchase at least $17 billion annually in U.S. agricultural products through 2028 , in addition to soybean commitments already discussed between U.S. President Donald Trump and Chinese President Xi Jinping. The announcement initially sparked optimism across commodity markets, sending grain prices sharply higher as traders hoped for a revival of the Phase One trade relationship established during the first Trump administration.

But as the week progressed, enthusiasm cooled. Traders and analysts began asking the same question they were asking at the end of last week: Where are the details?

Markets Want More Than Headlines

Dan Basse, president of AgResource Company, says the market reaction reflects a tug-of-war between improving crop conditions at home and the possibility of stronger export demand abroad.

“So, you know, it’s not that they’re doubting China,” Basse says. “And I think the point is we want details, and the markets are never patient, right? Ahead of them, we still have this thing called a war that’s ongoing with Iran. And there was news about maybe the possibility of some kind of peace accord that would always cause the war trade unwind.”

At the same time, Basse says farmers are looking at relatively favorable growing conditions in much of the country.

“We’ve got a relatively good start for crops,” Basse says. “They went in the ground easy. We’re now turning the calendar to June and things look relatively good, at least at this point, excluding the Western Plains where it’s still so dry and there’s a wheat problem. So the market’s struggling, if you will, with this idea of, ‘I’ve got a crop in the ground and farmers need to sell some old crop,’ along with ‘We’ve got this new potential shiny thing called China, better demand and something that looks like the Phase One agreement.’”

That uncertainty caused markets to pull back after the initial rally, even as optimism about Chinese demand remained in the background.

A Return to the Phase One Playbook?

Gregg Doud, president and chief executive officer of the National Milk Producers Federation, says the structure of the new agreement strongly resembles the original Phase One trade agreement negotiated during President Trump’s first term.

Doud, who served as chief agricultural trade negotiator during that administration, says those earlier talks took nearly a full year and involved extensive negotiations.

“Well, Phase One, the negotiation took us the entire year of 2019,” Doud says. “It was 33 negotiating sessions. We fixed 57 things in agricultural trade between the United States and China. And it really kind of took our exports from about 26 to 38 billion, as I remember.”

Doud says the earlier agreement nearly achieved its ambitious purchase goals before the COVID-19 pandemic disrupted global trade patterns.

“And remember, the Phase One purchase commitment was 80 billion over two years,” Doud says. “So when — and that was right before COVID hit — we got to 38 out of 40. So we were really actually pretty close on the aspirational purchase commitment.”

Now, Doud says the current agreement appears designed to restore trade flows to levels that already existed before relations between the two countries deteriorated.

“So here we have, again, the same thing,” Doud says. “Seventeen billion plus the soybean side of the equation. If you look at the old numbers, it’s about where we’ve been in the last few years. So this is basically saying where both China and the United States would like to think, ‘Get things back on track on agricultural trade.’”

China’s Silence Raises Questions

One source of skepticism in commodity markets is that China has not publicly acknowledged the $17 billion figure promoted by the White House. But Basse says that is not unusual when dealing with Chinese trade negotiations.

“It’s not typical, but it’s not uncommon with China,” Basse says. “If you think backwards maybe to October, when we did the last soybean deal, they didn’t acknowledge the 12 million metric tons and finally did, but they never really did acknowledge the Dabu Chan agreement, which is 25 million metric ton purchases by the end of a calendar year.”

Basse says Beijing often avoids publicly confirming major purchase commitments because doing so can reduce its leverage in future negotiations.

“If you’re China and you’re having to make these purchases, acknowledging it just kind of runs the table against yourself,” Basse says. “So it’s not unusual and not uncommon. I do not look for China to announce this.”

Still, Basse says there are clear signals the market can watch for to determine whether the agreement becomes meaningful.

“Though we’d like to see a drop in tariff levels from China — that 10% on beans and 15% on corn and wheat — that will be the first indication that the deal is real and we’re going to see the private buyers back buying United States grains,” Basse says.

Doud: “No Doubt. We Have a Deal.”

Doud says he believes the framework itself is already settled.

“No doubt. We have a deal,” Doud says. “There’s no question about that. It’s just a matter of how long it’s going to take.”

According to Doud, one important development is the creation of a more regular communication process between the two countries, including discussions about a “board of trade” concept that would allow both sides to review progress and address disputes on a recurring basis.

“This board of trade concept is really interesting to me,” Doud says. “This is a new element to our relationship and trade between the United States and China of saying, ‘Look, we need to engage on a very regular, maybe monthly basis, to see how these things are going.’”

Doud says maintaining regular communication is critical after several years of strained relations and limited engagement between the two governments.

“We went four years here without any conversation,” Doud says. “And if you do that with any of your customers, you don’t talk to them for four years, things are going to get a little loose and slippery, and we’ve got to get everything back on track. That’s what this discussion was all about.”

Beef and Poultry Could Benefit Quickly

Beyond grain markets, the agreement is already reopening doors for U.S. meat exports.

China recently granted five-year registration extensions to 425 U.S. beef plants and approved additional export facilities after more than a year of delays.

Basse says the biggest gains may actually come from poultry exports rather than high-value beef cuts.

“China’s an offal buyer,” Basse says. “They buy the organ meat, if you will, things that Americans don’t like to eat. I don’t think they’re buying the middle meats or the high-end steaks. So with that, it will be helpful, and that will help packer margins to some degree.”

But Basse says poultry exports could create even stronger opportunities.

“I’m really excited about the poultry side of things,” Basse says. “We’re getting back to selling things like chicken feet to China and some other things. So poultry actually excites me a little more than beef. And I think it’ll keep the old protein train moving, if you will, to the upside for many of these meat products looking forward.”

Dairy Demand Continues to Surge

While grain and meat markets wait for more certainty from China, the dairy industry is already benefiting from strong global demand.

Doud says U.S. dairy production and exports have both accelerated sharply this year.

“Our first quarter of this year, milk production in the United States is up 3.2%,” Doud says. “Our exports are up 7% in the first quarter. Our cheese exports are up 23%, and our butterfat exports are almost double.”

He says competitive pricing and changing consumer trends are helping drive stronger domestic and international demand.

“One of the things we’re noticing here is the yogurt sales so far in the last several months have just been through the roof,” Doud says. “So [it’s a] really, really good time to be in the dairy business.”

Doud also points to increased interest in protein-rich foods and products connected to GLP-1 weight-loss medications.

“When you have the GLP-1 conversation, that’s a hot topic of conversation, you’ve got to have more protein in your diet,” Doud says. “The clean labels, the healthy side of the equation, making America healthy again — this all leans itself toward more dairy.”

The Deal May Only Be the Beginning

For now, both men agree the U.S. and China have reestablished a framework for agricultural trade. But markets remain cautious because traders want evidence, not simply announcements.

Until tariffs begin falling, export sales increase and purchase commitments appear consistently in government reports, uncertainty will continue to hang over commodity markets.

The framework may already exist, but market analysts and industry leaders say the real test is whether China follows through.

China Grants 5-Year Extension to Hundreds of U.S. Beef Plant Registrations

Fri, 15 May 2026 18:23:58 GMT

China has granted a five-year extension to hundreds of U.S. beef plant export registrations, marking the first major movement in months on a trade issue that has constrained access to one of the most important overseas markets for American beef.

According to a Friday statement from the U.S. Meat Export Federation (USMEF), China’s General Administration of Customs (GACC) has extended registrations for 425 overdue U.S. beef establishments in China’s CIFER system. In addition, 77 new U.S. beef establishment registrations have been added, effective May 15, 2026, with each valid for five years. However, 38 beef establishments remain suspended. Of those, 25 were previously expired and have now been administratively renewed, but they are still not eligible to export.

The announcement adds a significant new development to a week of confusion and shifting signals around U.S. beef access to China. On Thursday, Bloomberg and Reuters reported that China appeared to have renewed export registrations for hundreds of U.S. beef plants during high-level talks between President Donald Trump and President Xi Jinping in Beijing. But those listings later reverted to “expired” on China’s customs website, with no official explanation, fueling uncertainty across the industry.

As recently as Friday morning, there had been no clear confirmation that broad renewals were in place. The USMEF update now provides the most concrete indication yet that at least partial restoration of access is underway, even as some facilities remain blocked.

Restoring Plant Registrations Was Top Priority for USMEF

For USMEF, restoring those registrations is priority number one, and even said before the high-level meeting this week that this type of meeting would be the perfect stage to restore the registrations..

“We have been at an impasse now for almost a year with these plants,” says Dan Halstrom, president and CEO of the U.S. Meat Export Federation. “The vast majority of the U.S. plants — 400-plus — are either delisted or were never relisted in their registration system in China. So in my opinion, it’s going to take an event like this to maybe jar this loose and break it loose. We’re cautiously optimistic that having this high-level meeting between President Xi and President Trump might just do that.”

Halstrom said while beef is only one piece of the broader trade relationship, these talks could provide the political momentum needed to reopen access.

“There are so many issues outside of beef and even outside of agriculture that are being discussed,” he says. “But time will tell. A meeting like this could absolutely be what we’ve been waiting for.”

From a $2 Billion Market to a Fraction of That

How high are the stakes? According to Halstrom, they’re significant. He says following the Phase One trade agreement in 2020, U.S. beef exports to China exploded. According to Halstrom, exports grew from roughly $300 million in 2020 to more than $2 billion by 2022.

But after the registration lapse last year, exports sharply declined.

“If you remember back to 2020 with the Phase One deal with China, that was a home run for the U.S. beef industry,” Halstrom says. “In 2020, we were exporting about $300 million of U.S. beef. We peaked out in 2022 at a little over $2 billion. Then in 2023 and 2024, we were around $1.6 billion. But after the plants were delisted last year, we dropped to a little under $500 million. So at a very high level, that’s the impact we’re talking about.”

And that loss isn’t just showing up on export balance sheets. It’s hitting cattle values at home.

Halstrom estimates access to the China market adds roughly $150 to $165 per fed animal harvested in the U.S.

“China has become a very important market because of the way it helps maximize the value of the carcass,” he explains. “There are products, especially variety meats that have significantly more value in China than they do here domestically. Items like backstrap and aorta are in very high demand there. If those products suddenly don’t have a home in China, it impacts the value chain almost immediately.”

Why China Matters to the Cutout

Halstrom says the impact also extends into traditional muscle cuts, especially short plates.

“Today, beef short plates are trading roughly around $2.50 per pound,” Halstrom says. “We estimate that if these plants were relisted and access was restored, you could see short plate values increase by more than a dollar per pound in relatively short order. That’s substantial.”

Halstrom also points out China’s importance stretches beyond just direct exports into the country. It really impacts all of Asia.

“It’s not just about what gets sold directly to China,” he says “The China market creates a halo effect across Asia because a lot of these same items are traded between China, Japan, Korea and Taiwan. So when China is actively buying, you immediately see stronger demand and stronger pricing across the region for products like short ribs, chuck flap and short plates.”

That broader demand ripple helps support overall cattle prices in the U.S.

“More customers rather than fewer is what impacts the cutout,” Halstrom says. “And there’s no doubt there’s been big money lost over the last year because these plants have not been relisted.”

More Than Just Plant Registrations

Halstrom stresses the expired registrations are only one layer of the issue that needs to be addressed.

“It’s not just the plant relistments,” he explains. “That’s phase one of what we need to have done. A large percentage of these plants are also dealing with technical and non-tariff trade issues, including residue-related issues that have caused additional delistings. So there are really two phases here — first getting these plants relisted in the registration system, and then working through these broader trade barriers.”

He said the U.S. Trade Representative’s office is fully aware of the challenges facing the industry and is listening.

“We’ve been dealing with USTR on these issues and they are very well informed on it,” Halstrom says. “The other thing from an agriculture perspective is encouraging the Chinese to go back and look at what they already committed to with the Phase One agreement back in 2020.”

Demand Is Still There

Despite the political tensions, Halstrom said the commercial appetite for U.S. beef in China hasn’t disappeared.

“One important point here is these are not government-to-government transactions. These are our customers,” Halstrom says. “They want the product and we want to sell it. The commercial business is still there.”

He pointed to major retailers and foodservice buyers already positioned to resume purchases quickly if access returns.

“Sam’s Club comes to mind immediately because they’re one of the leading modern big-box retailers in China,” Halstrom says. “Costco has warehouses there as well, and we also have foodservice customers lined up and ready to go. So we do not need to rebuild the commercial business. The customers are there, willing and able to buy U.S. beef. What we need is for the U.S. government and the Chinese government to work together to restore access so we can get back on track.”

As of the latest industry checks this week, registrations for most U.S. beef plants still had not been renewed.

SDRP Double‑Up Payment Rules Explained

Tue, 12 May 2026 20:46:02 GMT

Paul Neiffer, host of the Top Producer Podcast, discusses the Supplemental Disaster Relief Program (SDRP) and its “double-up” payment rules.

“I call it the double up. Typically, we call it a top up but, but they essentially doubled it up,” he says. “Our first initial payment was 35% and then this double up is on top of it, another 35% and for many of you, it’s going to be exactly what you got into the first one.”

Neiffer mentions that $11.7 billion has been paid out so far, with $12.5 billion expected in total between Stage 1 and Stage 2. With the program deadline being extended to August 12, 2026, Stage 2 farmers will continue to receive funds as USDA updates its database.

USDA allocated $16.09 billion to the program. If total payments reach $12.5 billion, approximately $3.5 billion remains for:

Payments for applications submitted by the August 12, 2024, deadline, including Stage 1 and Stage 2 quality losses.
A potential final “top-up” for producers.

“The reason [the total payout is less than the allocation] is a lot of farmers are going to hit the payment limits,” Neiffer says. Payment limits are $125,000 per year for regular crops and $125,000 for specialty crops. However, if more than 75% of your adjusted gross income (AGI) is farm income, those limits increase. “Before any of the 75% [test], that means you qualify automatically for $250,000 combined between ’23 and ’24 [for regular crops],” Neiffer explains.

Equipment gains and custom farming income remain “the rub” for qualification. Neiffer notes that currently, equipment gains may disqualify some from the 75% farm income test. While the “One Big Beautiful Bill Act” will make equipment gains automatically count as farm income starting in the 2026 crop year, that change does not apply to SDRP for ’23 and ’24.

Neiffer estimates a potential final top-up distribution of 5-10% could occur once all initial payments are settled. “Congress only authorized paying out up to 90%, so the most you can get is 20% [more]... I think the reality is we’re maybe looking at 7, 8, 9, somewhere between five and 10%.”

USDA Projects Smallest US Wheat Harvest Since 1972 Due to Plains Drought

Tue, 12 May 2026 17:43:23 GMT

U.S. farmers this year will harvest their smallest wheat crop since 1972, as a severe drought in the U.S. Plains has curbed production of hard red winter wheat, the largest variety grown in the U.S., the Department of Agriculture said on Tuesday.

This autumn, U.S. growers will also harvest their second-largest soybean crop on record, while corn production is expected to drop 6% from last year, the USDA said in its first official forecast of the 2026/27 crop season.

Rising fuel and fertilizer prices due to the closure of the Strait of Hormuz have sent grain production costs sharply higher, heaping further stress on the U.S. farm economy already reeling from trade disruptions caused by U.S. President Donald Trump’s tariff battles.

May 12, 2026 WASDE Winter Wheat

(Farm Journal)

U.S. growers expanded plantings of soybeans, which require less fertilizer than grains like corn and wheat. Winter wheat was already planted when the war began at the end of February, but soaring fertilizer costs curbed spring nutrient applications for winter wheat and spring-seeded crops like corn, soy and spring wheat.

Benchmark hard red winter wheat futures KWv1 and soft red winter wheat futures Wv1 on the Chicago Board of Trade rallied by their daily 45-cent-per-bushel trading limits.

The USDA projected U.S. wheat production in the 2026/27 season at 1.561 billion bushels, down from 1.985 billion in 2025/26, as a severe drought in the U.S. Plains was likely to slash the hard red winter wheat crop by 25% from a year earlier. Analysts polled by Reuters, on average, expected the USDA to project a 1.735-billion-bushel all-wheat crop.

The USDA rated just 28% of the U.S. winter wheat crop in good-to-excellent condition in a weekly crop conditions report on Monday, the lowest rating for this point in the growing season in four years.

May 12, 2026 WASDE Corn & Soybeans

(Farm Journal)

The USDA pegged the 2026 U.S. soybean harvest at 4.435 billion bushels, up from 4.262 billion bushels last year, but below the average trade estimate of 4.445 billion.

Corn production was forecast to decline to 15.995 billion bushels from a record 17.021 billion bushels last year. The estimate was above the average analyst estimate of 15.934 billion bushels.

But soybean demand remains unclear as top importer China has slashed purchases from the U.S. amid ongoing trade tensions between Washington and Beijing and abundant supplies from rival exporters Brazil and Argentina.

China and the U.S. may reach a farm deal at their summit this week that expands Beijing’s purchases of grains and meat, but market watchers said they did not expect major new soybean purchases beyond what was agreed in a deal last October.

The USDA projected U.S. soybean exports in the current 2025/26 season at 1.530 billion bushels and at 1.630 billion bushels in the 2026/27 season.

U.S. soybean stocks were forecast to shrink to 310 million bushels by the end of the 2026/27 marketing year, from 340 million at the end of the current season on August 31.

Corn supplies were expected to remain ample at 1.957 billion bushels at the end of the 2026/27 season, down from 2.142 billion for 2025/26.

(Reporting by Karl Plume in Chicago; Editing by David Gregorio)

House Ag Committee Chairman Says Farm Bill Pesticide Provisions Could Cause Concern in the Senate

Fri, 08 May 2026 18:55:29 GMT

After a flurry of debate, votes and finally movement, the Farm Food and National Security Act of 2026 passed the U.S. House with a 224-200 vote. House Agriculture Committee Chairman Glenn “GT” Thompson calls the legislation “transformational,” adding that 96% of GOP members in the House, the most in history, and 14 Democrats supported the bill.

“That’s the most members of the minority party who voted for a House farm bill since 2008. So, [that’s] a strong endorsement in a bipartisan way as this bill winds up in the Senate for consideration,” he says.

Despite his optimism, Thompson expressed concern over a key amendment introduced by Rep. Anna Paulina Luna. The addition stripped the farm bill of pesticide liability provisions. Before the amendment, the bill’s original language reaffirmed EPA as the sole agency capable of determining the information listed on a pesticide label. Critics, including Make America Healthy Again (MAHA) advocates, worry the language would shield pesticide manufacturers from liability claims.

“I have some concerns with the pesticide provision that was added,” Thompson says. “I think it may put farmers’ health at risk and certainly drive up affordability and open the door for foreign-manufactured pesticides to flood into our country.

“I have significant concerns that the amendment that was put forward is going to create chaos [in the Senate],” he later added.

Thompson says he’s supportive of year-round E15, but because it falls under the jurisdiction of the House Committee on Energy and Commerce, it will likely be taken up for a vote mid-May.

Moving Forward

Thompson says, overall, he thinks farm bill conversations in the Senate are positive. The chairman says he’s kept Sen. John Boozman, chairman of the Senate Committee on Agriculture, Nutrition and Forestry, well informed about the bill over the last year.

“I kind of pictured my good friend, John Boozma, with a catcher’s mitt, ready to receive the Farm Food and National Security Act,” Thompson says. “He’ll have to make some modifications, and I think he’s hoping to do that mid- to late May. He knows how ... our farmers need this bill today, not tomorrow or not next year.”

New Legislation Impacting H-2A Reform

Thompson says in three to four weeks, he will likely release draft language for public discussion that would make reforms to the H-2A program. After the draft, he’ll be introducing a bill with bipartisan support, he says.

“We’ve already had some very positive discussions with our [House] Judiciary [Committee] Chairman Jim Jordan — so, [I’m] looking forward to breaking that 45-, almost 50-year gridlock of really not doing anything in this space. I think we have a great opportunity to provide certainty to agriculture workforce, which quite frankly is necessary for both food security and ultimately national security.”

DOJ, USDA Ramp Up Antitrust Investigation Into "Big 4" Beef Packers

Fri, 08 May 2026 18:34:40 GMT

The Department of Justice and U.S. Department of Agriculture are intensifying scrutiny of concentration and pricing practices across the meat industry, announcing this week that federal investigators are ramping up a criminal antitrust investigation into the nation’s four largest beef packers.

During a joint press conference Monday at DOJ headquarters, Acting Attorney General Todd Blanche framed the effort as part of a broader push to address competition issues in agriculture and food pricing.

“Today we are here to talk about our progress here at the Justice Department to hold meat packers accountable,” Blanche says.

Federal officials allege price-fixing and collusion may have contributed to higher meat prices for consumers, while also limiting competition within the cattle industry.

“We prioritized investigating potential antitrust violations in U.S. cattle and beef markets,” Blanche says. “In the beef industry, the Big Four processors control over 85% of the beef processing market. Two of the Big Four are primarily foreign-owned.”

The “Big Four” — referenced during the press conference — are JBS, Cargill, Tyson and National Beef. The administration argues the current structure of the meat industry allows competitors to exchange competitively sensitive information across the protein sector — practices DOJ says it is now investigating.

DOJ Encourages Whistleblowers to Come Forward

Blanche also encourages whistleblowers within the meatpacking industry to provide information to federal investigators. DOJ says individuals who provide information leading to antitrust convictions or major enforcement actions could qualify for financial rewards.

“The idea of whistleblowers of people coming forward with information they have is one of the best and most efficient ways that we can solve antitrust violations criminally or otherwise,” he says. “And so we just want to make sure people realize that people in this industry realize that we’re putting money where our mouth is. We’re not asking you to come forward and then see what happens. We’re saying if you come forward and if your information results in a finding, in a conviction, and the amount of money is over a million dollars, which in this industry is not a very high bar, that you stand to recover up to 30%. And so we have to incentivize people to make a very difficult choice and come forward with information if they had it.”

R-CALF USA Applauds Investigation

R-CALF USA CEO Bill Bullard says the biggest takeaway from Monday’s announcement is that DOJ is actively seeking public assistance through its antitrust whistleblower program.

“The biggest takeaway was that the Department of Justice is reaching out to the public seeking help through DOJ’s antitrust whistleblower program, to find out what the public knows
about these anticompetitive practices,” Bullard says.

Bullard says R-CALF USA has spent years warning policymakers about growing concentration in the cattle industry.

“We’ve been calling attention and warning that this is a threat to our national security, our economy, and particularly to our food safety here and food security in the United States,” Bullard says.

Rollins Links Herd Decline to Regulatory Pressure

Agriculture Secretary Brooke Rollins also focused heavily on the shrinking U.S. cattle herd and declining number of ranchers during Monday’s event.

“In the past decade alone, we’ve lost over 17% of our cattle ranchers,” Rollins says. “More than 100,000 ranches across this country are no more.”

“The low herd size inherited by the Trump administration can be attributed to a variety of factors,” she says. “The biggest one, at least from our perspective, is the radical left’s ongoing assault against ranching as a way of life.”

Today, just four companies — JBS, Cargill, Tyson Foods, and National Beef — control roughly 85% of the cattle processing market. That level of concentration has surged from just 25% in 1977 to 71% by 1992, and now to an astonishing 85%.

Together, these companies operate through… pic.twitter.com/s4naYFcjt7
— Secretary Brooke Rollins (@SecRollins) May 4, 2026

Rollins argues drought alone is not responsible for cattle liquidation.

“For years, they used climate alarmism to wage a war on cattle in America,” Rollins says. “And when you pair that with droughts, wildfire, overregulation from previous administrations and volatile markets, this is how we have ended up here today.”

The administration also outlined several policy initiatives it says are designed to support cattle producers, including:

Opening more federal land for grazing
Implementing new “Product of USA” labeling rules
Supporting small processors through a grading pilot program
Updating dietary guidelines to emphasize the role of meat in the American diet

Rollins says additional announcements are expected later this week.

Agri Stats Settlement Targets Information Sharing

The DOJ’s broader push against anticompetitive behavior escalated Thursday when the department announced a proposed settlement with Agri Stats .

Federal officials accuse the company of helping major meat processors share confidential pricing and production data involving chicken, pork and turkey markets for decades.

Under the proposed settlement , Agri Stats would be prohibited from continuing several data-sharing practices DOJ alleges distorted competition and increased prices.

The agreement would also increase market transparency by making more information available to buyers and sellers throughout the supply chain.

Although the Agri Stats case does not involve beef, Senior Counselor for Trade and Manufacturing Peter Navarro referenced the pending settlement during Monday’s press conference.

“This is like the mathematician’s worst nightmare in terms of monopoly behavior,” Navarro says. “Basically, what the companies in this concentrated industry were doing was individually sending in data on everything, consumers, production, everything in between. And what did that computer do? It spit back what the monopoly price should be.”

With the settlement he explains, “Justice Department said no more. That’s not going to happen on our watch and that case I believe is going to be settled well or at trial in a way which not only will take care of that problem but implicate some of the bad actions that we’ve seen by the two American companies Tyson and Cargill and JBS on the Brazilian side along with National Beef.”

1 – The Department of Justice continues to bring affordability to the American people. Today, we announced a historic settlement with Agri Stats, whose business model directly raised the price of chicken, turkey, and pork in local grocery stores across our nation. 🐔🐖⚖️
— Acting AG Todd Blanche (@DAGToddBlanche) May 7, 2026

On X, Blanche says the settlement will create a more level playing field by making Agri Stats reports available to all buyers and sellers and calls it part of the administration’s broader push to fight anticompetitive behavior in the food supply chain.

Rollins also confirms the DOJ antitrust investigation into meatpackers originally announced in November remains ongoing.

“As ranchers face fewer options for selling their animals, the Big Four grow stronger and stronger,” Rollins says. “These companies now have an unprecedented ability to wield market power and influence prices paid for cattle — definitely more so than if we had greater competition.”

Industry Analysts Push Back on Concentration Claims

Not everyone in the cattle industry agrees that concentration itself is evidence of anticompetitive conduct.

John Nalivka, president of Sterling Marketing, says consolidation largely reflects economics and efficiency within the packing sector.

“As a business, you have to continually look to lowering costs,” Nalivka says. “And you can manage costs and you can manage revenue both. But the cost, you can have a direct impact on your cost structure. And one way of doing this, consolidating and gaining greater capacity and economies of scale.”

Nalivka also disputes the administration’s market concentration figures.

(Sterling Marketing Inc.)

“Well, to begin with, it’s not 85% now, it’s something more close to 78%, or even maybe a little bit lower than that when the Greeley strike was on,” he says.
The timing of the investigation is notable as packer profitability remains under pressure.

Nalivka says Sterling Marketing’s profit tracker showed beef packers losing nearly $200 per head at the end of April.

“From 2011 to 2015, we had the same set of circumstances, significant herd liquidation and pulling the numbers down,” Nalivka says. “And with the packing plant, the capacity is driven by — and I generate the numbers based on slaughter capacity — so it’s all about cattle numbers.”

Nalivka says his data shows the market share of the four largest beef packers has declined in 2026, with Tyson Foods’ share decreasing.

(Sterling Marketing Inc.)

According to Nalivka, the four largest beef packers now account for approximately 73% of fed-cattle slaughter capacity, leaving nearly one-quarter of processing capacity outside what the administration refers to as the “Big Four.”

“I have told people who have made these comments about these big bad packers,” Nalivka says. “I’ve said, first of all, I’ll start out with a statement, what would you do if you didn’t have one, a packer? And secondly, if you think it’s easy and you think you know so much about it, go build one.”

Producers Need Packers

Justin Tupper, U.S. Cattlemen’s Association president, says the DOJ action is less a brand-new effort than a continuation of long-running scrutiny. Tupper was a guest on AgriTalk Thursday .

Tupper acknowledges the seriousness of DOJ’s work, saying, “I sure do” believe they’re ramping it up, and called the probe “long-awaited and long-needed.” But he repeatedly warns about unintended consequences for producers if the investigation disrupts slaughter capacity.

“We like to vilify the packers all the time, but there is one truth to it, we need them,” he says, adding that if a major plant closed, it, “would cause more disruption than any good that could come from it.”

His concern is when cattle numbers rebuild, predicting, “When we get back to cattle numbers that they can control us, then they’re going to use that and weaponize that against us.”

Tupper stresses producers are not trying to deny packers a profit. “All we want as cattle producers is a fair shake; we don’t want to be used and abused when the cattle numbers are high.”

He warns the administration must understand “how tight that supply is and how few of places that slaughter them” and avoid “big disruptions.” He calls for thoughtful, balanced solutions developed with “cool heads and a lot of the smart people in the room” so the investigation doesn’t “disrupt the chain.”

Calls for Structural Reform Continue

Bullard says R-CALF USA continues pushing for significant structural reforms in the cattle industry.

“We’re asking them to do one of two things,” Bullard says. “Either break up the packers to provide more competition within the industry, or regulate those packers to ensure that they don’t engage in the antitrust conduct and anti-competitive practices.”

Bullard says the group is also urging the Trump administration to investigate what it describes as a “formula pricing scheme,” where cattle are increasingly sold through contracts instead of negotiated cash markets.

Critics argue those arrangements give major meatpackers greater influence over cattle pricing.

When asked whether the administration is listening to cattle producers’ concerns, Bullard points to Monday’s press conference as evidence of a major shift in Washington.

“Well, clearly it is,” Bullard says. “The press conference that was held talking specifically about the problems associated with beef packer concentration was unprecedented for the past 100 years. We have not seen our policymakers stand up and take a stand against the concentration of the cattle market. And so we’re excited that this administration is focused on this issue, understands that it is a national security issue, understands that as a result of our failure to properly enforce our antitrust laws, we’ve hollowed out rural American communities all across this country.”

Whether the federal investigation ultimately leads to major reforms within the cattle industry remains uncertain. But the debate over market concentration, competition and who controls pricing power in the U.S. cattle market is now squarely at the center of Washington policymaking.

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Not Done Yet: Despite Packer Investigation Price Shock, Cattle Prices Could Keep Climbing Through 2030

Tue, 05 May 2026 16:12:17 GMT

Fresh policy headlines injected new uncertainty into cattle markets this week, but they haven’t changed the bigger picture driving beef prices higher.

On Monday, Acting Attorney General Todd Blanche and Agriculture Secretary Brooke Rollins announced an intensified antitrust investigation into the so-called “Big Four” packers — JBS, Cargill, Tyson Foods and National Beef — which together process the vast majority of U.S. cattle. The probe, which the Trump administration says includes millions of documents and a push for whistleblower testimony, underscores growing concern in Washington over market concentration, pricing behavior and the impact on both producers and consumers.

That news sent cattle prices sharply lower.

While policy developments like Monday’s news can dominate the markets on any given day, they don’t necessarily alter the deeper supply-and-demand forces shaping the cattle market. And right now, those forces remain firmly intact: Record-high beef demand and historically low cattle supplies mean these strong cattle prices aren’t just here, but they may be here to stay through the end of the decade.

Cattle Prices Not Done Climbing Yet

Oklahoma State Extension livestock economist Derrell Peel says he’s never been this bullish for this long. And the reason is such strong fundamentals at play. The market’s direction is still being driven far more by biology and consumer behavior than by policy headlines. And while the investigation may shape the industry over time, it does not immediately create more cattle or reduce beef demand, which are two factors that remain at the core of today’s price strength.

The result is a market where short-term volatility — whether sparked by policy, disease concerns or geopolitical events — continues to play out against a longer-term bullish trend. And as long as supplies stay tight and consumers keep buying beef, the broader trajectory points toward the same conclusion: Cattle prices may not be done climbing yet.

What makes the current environment so unusual is not just the volatility in cattle prices, but how long demand has held together despite those increases. Consumers have continued to buy beef even as retail prices climb and supplies tighten, resisting the typical shift toward lower-cost proteins like pork or chicken. That resilience has been a cornerstone of the market’s strength, helping sustain the rally even as production constraints persist.

The Supply Side of the Story

Even with that looming concern, the supply side of the equation continues to dominate the broader market narrative. In fact, one of the most striking aspects of the current cycle is how little progress has been made toward rebuilding the U.S. cattle herd, despite strong price incentives that would typically encourage expansion.

“This is the longest in my entire career that I’ve basically had the same outlook,” Peel says. “This thing really started in the fall of 2022, as far as the current price run that we’re on. It continues. And the story hasn’t changed, and we really haven’t changed anything yet that sets up the idea that it’s going to change anytime soon.”

That consistency reflects a deeper theme within the industry. While high prices might suggest an imminent increase in production, the biological and economic realities of cattle production make rapid expansion difficult, especially when producers remain cautious.

“Very, very limited at this point — so essentially no,” Peel says when asked if there are signs the U.S. cattle herd is starting to rebuild. “I mean, we just have very limited indications of a little bit of interest in heifer retention, but not a lot happening yet. We’re watching the weather at springtime. There’s a lot of concern about drought conditions that could derail anything we might want to do anyway.”

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Without meaningful heifer retention, Peel explains the process of herd rebuilding cannot truly begin. And until that process starts, he thinks the market remains locked in a pattern of tight supplies and upward price pressure.

“The bottom line is we really haven’t started the clock yet on the things that would eventually lead to a top in this market,” Peel says.

That delay has pushed expectations further into the future, extending the timeline for when increased production might finally ease the market. Each passing season without expansion reinforces the same dynamic: limited supply supporting prices.

“Oh, yeah, we keep pushing it out,” Peel says. “You know, I’ve already extended it probably two years. We’re still waiting again for that clock to start at this point. So until we see some definitive signs of substantial amount of heifer retention, you know, the path continues as it is.”

Even if producers were to begin retaining heifers immediately, the lag time between that decision and its impact on beef production would stretch for years. That built-in delay is a defining feature of the cattle cycle and one reason why price trends tend to persist once they are established.

“And it’ll be some months after that,” Peel says. “Typically, a year to a year and a half after we start heifer retention would be when we would expect these markets to peak out. So we’re on a timeline now where, if we start saving heifers right now, it’s going to be the end of the decade before we really change overall beef production significantly.”

The Bullish Run in Cattle: How Long Can It Last?

That long runway helps explain why Peel remains firmly bullish — even at today’s record price levels. In his view, the market simply hasn’t reached the point where supply can begin to catch up with demand.

“Still predicting higher highs, as scary as that is for me to say,” Peel says. “We’re at record-high prices, and I expect that we’re going to go higher. I don’t think the peak in prices happens in 2026. I think it’s somewhere after that.”

Those supply constraints and demand dynamics point toward a market that could remain elevated well into the latter part of the decade.

“It’s really hard to say right now until we sort of know how it’s playing out,” Peel says, referring to how the eventual peak might unfold. “It’s all really kind of ahead of us as far as that goes. I don’t see it happening. We’re on such a slow build that I think it’s going to be more of a measured approach rather than a sharp peak.”

Still Some Uncertainty Ahead

Still, while the long-term outlook remains bullish, the short-term environment is anything but stable. Day-to-day market action continues to be shaped by uncertainty, with external shocks triggering rapid price swings that can complicate marketing decisions for producers.

“In the meantime, we’re dealing with a lot of risk and uncertainty in this market,” Peel says. “So we’re in this unusual situation where we have a bullish outlook and yet a really strong need for producers to be doing risk management just because the market is so volatile on a short-term basis.”

One Risk: High Gas Prices

One of those risks is the fact outside economic pressures are beginning to build. Gas prices recently jumped 33¢ in a single week, reaching their highest level since July 2022. While that may seem disconnected from cattle markets at first glance, fuel costs play a direct role in shaping consumer purchasing power, especially when increases persist over time.

“Economists define demand as willingness and ability to purchase products,” Peel says. “The willingness is there. But the ability, high gas prices is probably the biggest threat out there.”

That distinction between willingness and ability is critical to understanding where the beef market could be headed next. So far, consumers have shown little hesitation in purchasing beef, even at elevated price levels. However, sustained increases in everyday expenses like fuel can gradually erode disposable income, forcing households to make tougher decisions at the meat counter.

“If the current geopolitical situation persists and keeps gas prices high for another few months, at some point in time it may impact consumer incomes enough that it forces them to make more adjustments,” Peel adds. “And that would be the biggest threat to beef demand at this point.”

That potential shift has not yet materialized, but it represents one of the few risks to an otherwise bullish outlook. For now, demand remains strong, helping support prices even as supplies remain historically tight. But the longer external cost pressures linger, the more likely it becomes that consumer behavior could begin to change.

New World Screwworm Risk

Animal health concerns have been one of the more visible drivers of that volatility, particularly when it comes to New World screwworm . Even unconfirmed reports or isolated cases have proven capable of moving markets, highlighting just how sensitive current conditions are to uncertainty.

“These animal health issues are certainly one of them,” Peel says. “We’ve got a lot of things going on right now that are kind of like that. We get news, and markets don’t like uncertainty. And so that’s what we’re dealing with here.”

Peel says in some cases, the uncertainty is worse than the reality, which means the market is even more sensitive to any type of news.

“But the market is also very resilient. So when we do see these impacts, whether it’s from New World screwworm or concerns about infrastructure or geopolitical events, whatever it is, the market tends to react, but then it bounces back pretty quickly,” he points out.

But for producers, Peel says volatility is a major risk.

“And the challenge for producers is to not get caught where you have to be marketing something in the middle of one of these short-term shocks in the market,” he says. “And so that’s the challenge for them to try to manage around that volatility.”

Is the U.S. Prepared?

From a policy and preparedness standpoint, Amy Hagerman, Extension specialist for agriculture and food policy at Oklahoma State University, emphasizes risks like New World screwworm extend beyond cattle imports alone. The pathways for introduction are broader, requiring a more comprehensive approach to monitoring and response.

“This is a pest that likes anything that’s warm-blooded,” Hagerman says. “And so it’s going to catch a ride with anybody that it can catch a ride with.”

Yet, there’s a general assumption that even though the Southern border remains closed to live cattle imports, that if NWS enters the U.S., it won’t be because of cattle. Instead, it could enter the U.S. via wildlife or something else.

“I think a higher level of awareness, education and vigilance is really important, whether we’re talking about pets for somebody who has vacationed in Mexico, or even individuals, or whether we’re talking about wildlife,” Hagerman says. “We’ve seen a real effort, publicly and privately, to kind of enhance that awareness.”

The latest NWS case, according to Hagerman, is less than 70 miles from the U.S. border and points to the urgency of ongoing monitoring efforts in the region.

“As somebody who does a lot of emergency preparedness, I can tell you that all plans never survive interaction with reality,” she says. “But I do think we’ve put a lot of effort, a lot of time into preparing for this — setting up the infrastructure and educating producers because this is going to be a producer-management issue by and large.”

Possible Permanent Changes of Flow of Cattle From Mexico to the U.S.

Peel adds that while such issues may be costly and complex at the individual level, their broader market impact may be limited compared to supply fundamentals.

“I think the risk here for the impact of New World screwworm is not so much a broader market one, because it’s going to be a very costly issue for producers individually to manage, for regional efforts to control it,” Peel says. “It’s probably not going to impact the overall market all that much.”

Beyond animal health, trade policy remains another uncertain variable. The continued closure of the southern border to live cattle imports has already reshaped supply flows, and prolonged disruption could lead to more permanent structural changes.

“I think we could,” Peel says when asked whether trade patterns might shift for good. “I mean, arguably the biggest impacts of all of this in terms of the economic impact of the border being closed, we’ve already felt up to this point.”

“You know, we probably didn’t get 700,000 or 800,000 head of Mexican cattle last year that we would have gotten,” Peel adds. “And so, you know, we’re past that now, but the thing is, those cattle have been dealt with. They’re using them in Mexico. They have infrastructure to utilize those cattle in their domestic market.”

Peel says the longer this goes on, the more supply chains and production systems need to adjust to the fact the normal or historic trade flows have changed.

“The risk is that maybe we lose it permanently. It changes things on a permanent basis,” Peel says.

No matter the day-to-day noise, the market remains defined by a rare combination of strong demand, constrained supply and mounting external pressures. While higher fuel costs could eventually test consumers’ ability to keep paying record prices, the lack of herd expansion continues to underpin a bullish outlook, one that may keep cattle prices elevated through the end of the decade.

Kicked Out of the Farm Bill: What's Next for E15?

Thu, 30 Apr 2026 21:49:31 GMT

When Congress returns from recess May 12, advocates hope E15 will get another chance in Washington. The measure was removed from the Farm Bill Wednesday following heated debates.

Legislation to allow year-round, nationwide E15 sales is now moving forward as a standalone bill. If the bill passes the House, it will likely be reintegrated into the broader Farm Bill.

The push for E15 has been a long-fought political struggle. However, Washington insiders believe the odds of passage are currently high. This is due in part to a renewed focus on biofuels and domestic energy security following recent global conflicts.

A Critical Vote on the Horizon

Industry leaders remain optimistic about the upcoming legislative schedule. Troy Bredenkamp, Senior Vice President of Government & Public Affairs for the Renewable Fuels Association (RFA), expects movement soon.

“I believe we will get our vote on the E15 measure on May 13. So things are still on track,” Bredenkamp says.

Despite the momentum, many farmers remain cautiously optimistic. The industry has seen similar measures fail at the finish line several times before.

“I mean, we get it right to the edge and then and then off it goes again. So, it’s been extremely frustrating,” Brent Johnson, president of the Iowa Farm Bureau says.

Reaching a Compromise

To advance the bill, an E15 task force consisting of refining and ethanol interests reached a compromise. The deal provides exemptions for the smallest refiners regarding blending obligations under the Renewable Fuels Standard (RFS).

Geoff Cooper, president and CEO of the RFA, explained the criteria for these exemptions: “If you can prove to EPA that you are at imminent risk of closure, and you can make that disclosure publicly, and you can show that the reason that you’re at risk of closure is the RFS itself, then you can have access to a capped amount of exempted volume.”

Additionally, a provision was added for other small refineries facing emergencies. This includes a 150 million RIN category they can tap into if they face an imminent threat of closure.

Economic and Environmental Impact

The industry is confident that these compromises will secure enough support for passage. Bredenkamp noted that the coalition of support is broad and bipartisan.

“We are probably three to one, almost four to one, support versus opposed to the E15 measure. We have over 60, almost 70, Democrats that are in support. So I think we can more than offset the amount of Freedom Caucus Republicans that may be in opposition to this,” Bredenkamp says.

While E15 remains voluntary, proponents say it will significantly boost corn demand. Bredenkamp estimates a massive shift in the market over the next several years.

“Within five years, you can move E10 to E15. That’s an additional 7 billion gallons of ethanol demand. That’s going to be an additional two-plus billion bushels of corn grind that is going to be needed,” he noted.

For farmers and consumers, the benefits are clear. Beyond market demand, the move is seen as a win for the environment and the American wallet.

“To, you know, help increase production, lower fuel costs for every consumer out there and really to start to take care of ourselves more domestically when it comes to our our fuels and it’s cleaner for the environment and it’s, I mean there’s just so many positives about it. It’s frustrating that the politics gets in the way,” Johnson says.

“E15, with the kind of production that we have the ability to do, it’s time to get it done,” adds Tim Recker, a farmer in Northeast Iowa.

New Data: Is U.S. Agriculture Facing a Typical Cycle or a ‘Geopolitical Reset’?

Thu, 30 Apr 2026 18:56:46 GMT

The latest Farm Journal Ag Economists’ Monthly Monitor shows a bit more pessimism from respondents on the current state of the ag economy as well as how the present compares to one year ago.

Farm Journal regularly reaches out to a vetted list of 80 ag economists from across the industry. Providing directional insights, 10 of the 16 economists who responded to the April survey believe the ag economy is in a worse state than it was a year ago. Slightly fewer than half expect conditions to be “somewhat better” in 12 months, while one-third still anticipate further decline.

“I just haven’t really changed my level of pessimism regarding this year. This is going to be a tough year. There’s no doubt about it,” says Michael Langemeier with Purdue University.

The conflict in Iran weighs heavy on economists’ minds; high fertilizer prices and high energy costs dominate concerns. This overshadows the previous looming concerns of the trade fragility and export deficit. The previously announced government payments are in the rearview mirror.

Wes Davis from Meridian Agribusiness Advisors agrees that profit margins squeezed by high input costs are the top concern.

“When we talk about the more pessimistic view of the ag economy, fertilizer prices driven by the outbreak of war in Iran is certainly top of mind,” he says.

But Davis says there have been some positive tailwinds for commodity prices over the past few months, and there’s ‘no slowdown’ in demand for animal proteins.

“Those tailwinds continue to be present,” he says.

A Fundamental “Structural Shift”

Three-quarters of the economists believe U.S. agriculture is undergoing a permanent structural shift rather than a typical cyclical phase. They cite increased competition from Brazil, changing trade policies and the rapid adoption of artificial intelligence as factors reshaping the industry for the long term.

(Farm Journal Survey, April 2026)

“I’m thinking of this one as the geopolitical and input reset,” Davis says. “What I mean by that is, where things go and how we interact with the global ag economy when this cycle or when this shift is over will be different. The way that farmers get their agrichemicals, their fertilizers, their vitamins/trace minerals for feed, their tractors will all be different.”

Davis brings up the farm bill as another example. He questions whether the structural shift in policy is moving away from supporting “commercial farm preservation” and more toward “rural economic development.” This distinction could change the long-term framing of ag policy.

While Davis’ perspective is in the majority, Langemeier offers a counterpoint. He says this today reminds him a lot of the 2014 to 2019 period when there were about six years in a row of relatively low crop margins.

“I know there are a lot of changes going on, and certainly we’re worried about the competitiveness of U.S. agriculture compared to Brazil, particularly for soybeans,” he says. “As one example, I think the AI developments actually could be positive, and so I don’t necessarily see why that would necessarily mean a structural shift that would be negative.”

Geopolitical Impacts on Input Costs

The conflict in Iran and broader Persian Gulf instability are identified as primary drivers of agriculture’s economic health. Economists are specifically concerned about how these tensions are “pinching margins” by driving up the costs of energy and fertilizer while commodity prices remain relatively low.

“The negative impact of the Iran conflict has been increased fertilizer and energy prices. I did some crop budget calculations: If you hadn’t bought your fertilizer and most of your fuel is yet to be purchased prior to the Iran conflict that’s a pretty large effect on corn break-even price. I calculate it to be 25 cents a bushel. And when your break-even price is already at $5, which is way above what the futures price adjusted for basis is this fall, that’s certainly not helping matters,” he says.

It’s not just fertilizer and fuel. It’s other input categories in row crop agriculture and livestock production as well.

Noting input prices are 15% to 20% higher than pre-COVID levels, Davis points out that prices for active ingredients have gone up 20% to 30% since the conflict in Iran started.

“This continues to exacerbate that question around how long are we going to continue to see input prices increasing?” Davis says. “The other things that are less talked about but are starting to show up in pricing data are things like low inclusion additives for livestock feeds, so things like vitamins and trace minerals are starting to show up in pricing increases as well as they are being disrupted in trade flow and a slowdown of exports from China.”

Langemeier adds to the question around input pricing increases, saying it’s unknown if the uncertainty and elevated costs will go into 2027.

Strategic Deferment of Capital Expenses

To manage tight margins, farmers are expected to prioritize paying down debt over investing in land, equipment/technology, capital improvements and labor. Machinery and equipment purchases are the top items likely to be reduced or deferred in 2026, with half of economists also warning that cuts to fertilizer and crop protection could start impacting yields.

(Farm Journal Survey, April 2026)

“The number one thing as always is farmers want to be paying down debt,” Davis says. “Equipment is going to continue to be in a trough, and my expectation is that tractor sales year over year are still going to be 10 to 15% lower this year versus last year.”

He also foresees a continued transition to generic crop chemicals for the next two years.

Davis makes a distinction regarding which farms could survive this pinch on profitability. He describes a “tale of two economies” where disciplined farms with high liquidity can still find financing to grow, while those who grew aggressively at the peak of the cycle are facing a “pullback” from lenders. This adds a layer of nuance to the “commercial viability” discussion.

Langemeier provides a sobering warning about how farmers are managing the third year of low margins. He notes a trend of farmers starting to borrow against their land (non-current debt) to cover operating expenses — a pattern seen during the 2014 to 2019 downturn. He emphasizes the urgent need for “contingency planning” and a “Plan B” for debt repayment this fall.

“Usually, farms will try to cover their owner withdrawals and repay debt before they even think about making down payments on machinery. Capital expenditures always get squeezed when cash flow is tight. That’s just the way it works. We’re in one of those situations where capital expenditures are just going to be lower, primarily machinery and buildings,” Langemeier says.