Ag Economists Monthly Monitor

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.

Analysts Fear 2027 Could Be The Toughest Year Yet For Farm Margins

Thu, 30 Apr 2026 20:09:43 GMT

The most important tool on many U.S. farms this spring isn’t a tractor or a high-speed planter — it’s a pencil. Faced with climbing fertilizer costs, some growers are still hunched over spreadsheets and notepads as April shifts to May, trying to determine if corn or soybeans can pencil out.

Market analysts Naomi Blohm of Total Farm Marketing and Matt Bennett of AgMarket.net say they believe the current planting season remains in a state of flux as farmers’ input budgets are tightened to the breaking point.

According to a recent American Farm Bureau Federation survey, 48% of Midwest farmers say they cannot afford their full fertilizer needs for this season.

“Farmers who haven’t paid for fertilizer, are running behind, or are stuck out of the field due to weather are having to factor that into their decision-making,” Bennett says.

Blohm is seeing this reality play out in real-time with her clients. “Two of them openly shared this [past] week that they booked some fertilizer early and went with corn on those acres,” she reports. “But for the remaining acres, they had to stop and think it through and ultimately decided to switch to soybeans.”

Bennett notes that while soybean futures aren’t necessarily “explosive,” they could be a safer bet for cash-strapped operations. “If I’m a grower, and I’m sitting here trying to figure out whether I can make money putting $1,000, $1,100 [of nitrogen an acre] into this corn crop, I look over on the board on beans, and you’re looking at a price a lot of growers can make work just with average yields,” he says.

Blohm adds that what farmers decide to plant will be much clearer by USDA’s June 30 acreage report.

A Three-Year Financial Drain

The current financial stress isn’t happening in a vacuum. Bennett points out that consecutive years of financial pressure have taken their toll across the Midwest.

“The liquidity drain over the last three years has made it really tough for people, and we are even seeing an equity drain for some,” Bennett says. “When cash is this tight, it highlights why you might plant soybeans if you don’t have your anhydrous or urea on yet.”

The fertilizer crisis is fueled by global energy markets and geopolitical instability. Blohm points to India’s recent, aggressive moves to secure supply as a sign of things to come.

“I saw that India this week booked what they needed for fertilizer at double the cost,” she says. “But they don’t have a choice really, based on the amount of wheat that they grow in the world. They have to have a good wheat crop there, and they need that fertilizer.”

Bennett adds the issue isn’t just price — it’s access. “India bought 2.5 million tons of urea to front-run a potentially problematic situation,” he notes. “Disrupted natural gas facilities create a cascade effect that impacts anhydrous and urea production globally.”

2027: “It Scares the Daylights Out of Me”

While 2026 is beyond difficult, analysts are sounding the alarm for 2027. During an afternoon AgriTalk segment , host Michelle Rook asked if 2027 will be even worse.

“It scares the daylights out of me,” Bennett replied. “Projected cash flows and breakevens for 2027 don’t look good at all. Even if someone talks about $5 corn, you have to look at what you’ll have invested in it.”

Blohm agrees that the uncertainty is unprecedented. “Producers have to stay on their toes,” she says. “We don’t know if this shock will be a springboard for higher prices or if it will simply compress margins further.”

The Rotation Debate: Markets vs. Agronomics

How will crop rotations look by 2027? Farm Journal regularly reaches out to a vetted list of 80 ag economists from across the industry. Providing directional insights, the latest Ag Economists’ Monthly Monitor shows almost half of the respondents (seven of 16) to the April survey expect soybeans to gain more acres due to renewable diesel demand.

Northeast Iowa farmer Tim Recker sees some potential for a shift. “Renewable diesel demand underpins my local market,” he says. “I see value in policies that turn surplus crops into fuel, but we have to remember that Brazil is still eating our lunch in the global market.”

Central Illinois grain producer and hog producer Chad Lehman has a more cautious outlook.

“Pigs need corn,” Lehman says. “There are real risks with bean-on-bean rotations, including yield penalties and agronomic challenges. Even with more crush capacity, soybean meal prices remain strong, which reinforces the need for steady corn production.”

University of Missouri Agricultural Economist Ben Brown suggests that while “swing acres” might lean toward soybeans next season, many farmers will stick with their rotations.

“I believe 85% of acreage is determined by rotation,” Brown says. “That leaves only 15% to be adjusted based on outside influences.”

Long-Term Risks Of Changing Rotations

Shifting rotations in 2027 can’t be a financial decision only; it carries long-term agronomic consequences. Connor Sible, associate professor and row-crop field researcher at the University of Illinois, cautions that fertilizer cuts made this season could contribute to nutrient depletion in soils.

“If we pull back on nutrients now, those minerals are going to have to come from somewhere — likely the soil supply,” Sible says. “We want to maintain a healthy system over time, so we can’t go too far with input pullbacks.”

For those farmers already eyeing a move to soybeans in 2027, Sible recommends starting the planning process now.

“Think about what herbicide programs you are putting out this summer,” he advises. “You need to account for potential carryover effects if you switch the rotation in a field that was planned for corn to go with soybeans.”

You can hear more from farmers Chad Lehman and Tim Recker and their thoughts on the year ahead in this discussion on AgriTalk, available at the link below:

Confidence in USDA Reports Erodes as USDA Launches Internal Review

Wed, 18 Feb 2026 19:48:17 GMT

Confidence in USDA reporting is slipping across the agricultural economy, and it’s not just talk in the countryside.

According to Farm Journal’s January Ag Economists’ Monthly Monitor , released at Top Producer Summit , the majority of economists, producers and retailers say their confidence in USDA reports has declined compared to past years.

68% of economists say they are less confident in USDA reports.
73% of producers say their confidence has declined.
78% of retailers report waning trust.

The findings framed a candid conversation on stage at Top Producer Summit featuring Seth Meyer, director of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri; Grant Gardner of the University of Kentucky; and Chip Flory, host of AgriTalk.

At the center of the discussion: A June acreage “miss” and subsequent revisions left many in the industry questioning how such large shifts could occur in a short window and whether the data driving markets can be trusted.

The June Acreage Shock

Flory points to a key frustration voiced by producers: How could USDA show such a drastic acreage change in a short amount of time?

Meyer, former USDA chief economist, acknowledges the issue.

“Quite honestly, I think this is a problem,” he says. “If you’ve lost confidence, we have to ask why.”
He emphasizes, however, the issue is not political interference or hidden agendas in USDA or the National Agricultural Statistics Service (NASS ).

“It is not that these people have a political agenda,” Meyer says. “They want to do a good job. I hated being wrong.”

Instead, he pointed to structural challenges, including survey fatigue among producers and confusion about how acreage numbers are constructed and revised.

The June planted acreage miss triggered a chain reaction. Planted acreage revisions led to harvested acreage revisions. Add in larger September carryout stocks, and the cumulative effect was a bigger crop supply than the market anticipated.

Several adjustments in a row, some related, some not, all moved in the same direction.

“That September acreage adjustment gave me a better understanding of how misunderstood the process is by producers,” Meyer says. “You certify planted acres, not harvested acres. Harvested acres is where the big change occurred.”

Why Not Just Use FSA Data?

A frequent question from producers: If acreage is certified with the Farm Service Agency (FSA), why doesn’t USDA simply use those numbers?

Meyer says they do use FSA numbers and increasingly earlier in the process than in the past.

Four years ago, FSA-certified acreage data wasn’t fully incorporated until the October report. Today, USDA has moved that integration forward into August, releasing certified data alongside other reports to improve transparency and eliminate timing confusion.

If anything, Meyer argues, FSA data is being used better now than it was in the past.

He also notes private industry analysis of FSA data pushed USDA toward earlier use, increasing transparency in the process.

Can Satellites Replace Farmer Surveys?

With fewer farmers responding to surveys, another question surfaced: Why not rely more heavily on satellite imagery?

Meyer says Earth observation tools have improved, but they are not yet a substitute for field-level survey data.
Satellite tools can get close. But he warned there is a threshold effect: Once survey quality drops below a certain point, the value of the report doesn’t slowly decline, it collapses.

“You’ve got to ground-truth it,” Gardner adds. “Even if satellite data improves, you still need to go look.”

Meyer says he would want to see satellite systems consistently match field survey results for years before replacing traditional methods.

Workforce Reductions Come Into Play

Since January 2025, USDA’s workforce has been cut by more than 20,000 staff members, which former acting deputy undersecretary Spiro Stefanou says hampered FSA from processing planting data last summer and feeding it to NASS.

Meyer admits that experience can’t be replaced.

“I would say the cushion we have in terms of knowledge base is largely gone,” he says. “We wouldn’t want to go through another period of losses where I would have lost more people in those units who did the WASDE report.”

Internal Review: Will It Restore Confidence?

Following the January WASDE report, in which USDA raised harvested corn acres by 1.3 million for a record 4.5-million-acre increase since July, the agency launched an internal review of its data collection processes. Will that help?

Gardner says economists’ concerns often focus less on methodology and more on staffing and budget cuts.
“From the economist perspective, it wasn’t as much, ‘Is this the best data we have?’” Gardner explains. “It was, ‘Do we have the best people in place?’”

From the producer perspective, however, the frustration is different, involving surprise adjustments and a perception that official reports don’t match what’s happening at the farm gate.

Meyer believes the review might restore some confidence, but he doesn’t expect sweeping findings.

“It’s 100% the best data out there,” he says. “Follow it, because you’re not getting anything better.”

Still, he acknowledges the partnership between USDA and producers must be strengthened.

“This is an important partnership,” Meyer says. “USDA has to prove its value proposition to producers. They have to prove this is good for producers, and that it creates symmetry of information in the marketplace.”

Confidence Tested, Not Broken

While trust in USDA data might be eroding, panelists stopped short of declaring the system broken. The message from the stage was clear: The data remains the best available, but maintaining its credibility will require transparency, engagement and renewed participation from producers themselves.

A Crisis of Confidence: Inside the Ag Economy and How Farmers Are Preparing for What’s Next

Wed, 11 Feb 2026 15:11:30 GMT

If there is one word that defines the U.S. agricultural economy in early 2026, it’s confidence, or more precisely, the lack of it. It’s not just an eroding confidence in data, but declining confidence in policy and whether the traditional tools used to stabilize farm income still work.

The first Farm Journal Ag Economists’ Monthly Monitor of 2026, coupled with input from producers and ag retailers, reveals an industry that broadly agrees it is in trouble, but sharply disagrees on why, who should fix it and how farmers will survive it.

Across the economists, farmers and retailers surveyed, the results paint a picture of a crop sector stuck in recession, magnified by the squeeze caused by high input costs and low commodity prices.

Factors Driving the Health of the Ag Economy Today

Economists in January’s survey pointed to a familiar but intensifying split in the ag economy: strength in livestock, particularly beef cattle, versus persistent financial stress across much of the row-crop sector. Tight cattle supplies and strong global demand for animal protein continue to support profitability in the livestock sector, even as economists warn that future prospects remain uncertain. At the same time, global surpluses of corn, soybeans and wheat, combined with weak export demand for certain commodities, are weighing heavily on crop prices.

(January 2026 Ag Economists’ Monthly Monitor)

Across nearly all responses, margin pressure emerged as a dominant concern. Elevated input costs, rising interest rates and tightening access to operating loans are pushing break-even costs above market prices for many producers, especially in grain production.

Economists repeatedly cited policy uncertainty, ranging from trade relations to biofuels policy, as a pivotal factor. While government assistance and expectations of additional ad hoc payments are providing some near-term relief, many note those funds are largely being used to service debt rather than reinvest in operations, underscoring ongoing liquidity challenges in farm country.

In the anonymous survey, when asked the two factors driving the health of the ag economy today, the economists said:

“Continued strength in the cattle business and that the world is awash in corn, wheat and soybeans.”
“Cost-price margins: Agriculture’s economic health is being driven first by whether commodity prices are high enough to cover still-elevated input, labor and operating costs.”
“Policy uncertainty hurting export demand and biofuels demand — cattle receipts providing lucrative returns but with uncertain future prospects.”
“Break-even costs above market prices, demand uncertainty on multiple fronts.”
“Persistent high input costs and uncertainty regarding trade, particularly trade with China.”
“Access to operating loans and the amount of debt producers are carrying from the previous two years of down revenue.”
“Positives include strong beef cattle margins and relatively stable land prices; negatives are burdensome crop supplies, high input prices and very low liquidity.”

A Crop Sector in Recession By Consensus

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes )

On the state of the economy itself, there is little debate:

76% of economists say the U.S. crop sector is in a recession.
74% of producers agree.
More than 76% of economists believe conditions are worse than a year ago.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes )

Economists warn this environment is accelerating consolidation, with 72% expecting low prices and high costs to push weaker operations out of the market with 80% of retailers saying it will increase consolidation in the industry.

When you look at what’s preventing profitability, high input costs remain the dominant hurdle for producers:

67% of producers cite input prices as their biggest obstacle.
62% of economists agree that high input costs are a hurdle for farmers in 2026.

Sticky costs for fertilizer, labor, interest rates and materials, combined with soft commodity prices, have pushed many producers to sell at or below break-even.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes)

“Maximum Is Rarely Optimum:” How Farmers Say They’ll Stay Alive and Competitive in 2026

When asked a simple but heavy question: “What can you do to be successful in 2026,” farmers didn’t sugarcoat the challenge. Their answers reflect pressure, fatigue and uncertainty. But underneath the blunt language is a clear, consistent strategy emerging across operations: protect cash, defend ROI and stay flexible long enough to outlast the cycle.

While several producers said they’re looking to diversify as a key to success, the most dominant theme was cutting costs to the bone, especially when it comes to capital spending. Farmers repeatedly emphasized zero, or near-zero, capex, delaying equipment upgrades and scrutinizing every purchase.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes )

The mindset is not panic, but discipline. In this month’s survey, farmers said the key to success is:

“Zero capital spending or as close to zero as possible.”
“Don’t buy anything that isn’t absolutely necessary.”
“Hold off on major capital expenditures.”
“Ask yourself before you purchase something, is it a want or a need. Wants can break you fast.”

Many farmers framed this as a return to fundamentals: preserving working capital, maintaining flexibility, and avoiding irreversible decisions in an uncertain margin environment.

The Federal Aid Gap: Band-Aid or Lifeline?

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes )

Few issues expose the disconnect between economists and producers more clearly than federal aid.

There is broad agreement on one point: Ad hoc farm payments are not a long-term solution. Just under 60% of both economists and producers describe them as “a Band-Aid that won’t heal the wound.”

January 2025 Ag Economists’ Monthly Monitor

(Lori Hayes )

Beyond that, thoughts on federal aid differ.

51% of producers believe more than $20 billion in additional aid is required to stabilize the ag economy.
28% of economists believe no additional aid is needed at all while the remainder are split across ranges from $11 billion to $20 billion.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes)

This gap matters because it directly influences behavior. Both groups agree that government policy will be a major driver of planting decisions in 2026, with a clear bias toward corn . Expectations around payments, programs and biofuels demand are shaping acres before a seed ever goes in the ground.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes )

Biofuels: One Industry, Two Visions of Salvation

No policy area reveals the philosophical divide between “on the ground” agriculture and “on the spreadsheet” analysis more clearly than biofuels. Producers want more demand now, whereas economists are looking five to 10 years out.

Producers and retailers overwhelmingly prioritize E15 expansion, viewing it as the single fastest way to generate real, immediate demand for corn and reduce reliance on government support.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes)

Economists, while supportive of E15, are more focused on structural, longer-term demand drivers, particularly:

45Z tax credit
Development of Sustainable Aviation Fuel (SAF) markets

Among economists, 39% ranked the 45Z tax credit as the most impactful policy, while SAF ranked much higher than it did among producers where 44% ranked SAF as least impactful.

The Collapse of Trust in USDA Data

USDA’s January Crop Production Report was a point of contention last month. With much debate about the validity of the latest yield, acreage and production data from USDA, Farm Journal’s January survey results is the near-universal erosion of trust in USDA data, not only among producers, but also economists and retailers.

68% of economists say they are not as confident in USDA reporting as they were in the past.
73% of producers agree.
78% of retailers say their confidence in USDA has waned.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes)

For economists, the concern centers on revisions, lagging indicators and the challenge of modeling markets amid policy uncertainty. For producers, the distrust is far more emotional and personal. Open-ended responses frequently referenced “market manipulation,” “bearish curveballs” and a sense that official numbers no longer reflect what’s happening at the farm gate.

In a market environment already defined by thin margins, the loss of confidence in baseline data further complicates marketing, risk management and lending decisions. When trust in the numbers erodes, so does the ability to plan.

Political Support Remains, But Confidence Is Slipping

One year into the Trump administration, producers remain broadly supportive of the president. But confidence in Washington’s ability to improve the ag economy is fading.

52% of economists say they are less confident the administration can improve agriculture.
44% of producers report declining confidence as well.

January 2026 Ag Economists’ Monthly Monitor

(Lori Hayes)

The divide between the groups is notable. Only 8% of economists feel more confident than a year ago, while 34% of producers say their confidence has increased, suggesting optimism on the farm still exists, even as economists grow more skeptical.

Trade uncertainty, shifting biofuels policy signals and questions about the future of ad hoc aid have all contributed to a sense that political alignment does not automatically translate into economic relief.

Strategy vs. Survival

Where the survey becomes most revealing is in the open-ended responses about survival. Economists see a severe but cyclical downturn. Many producers see a structural breaking point.

Economists speak the language of optimization. Their recommendations include:

Margin-first decision-making
Defensive marketing
Strategic planning
Focusing on high-productivity acres
Driving down per-unit input costs

Producers speak the language of survival, saying the key to weathering this story will be:

“Find an off-farm job”
“Send my spouse back to work”
“Sell out”

Some responses went further, referencing bankruptcy and financial collapse, a level of personal desperation absent from economists’ professional analysis.

One producer wrote: “I am facing financial crisis and homelessness … in the worst financial situation ever.”

An economist, by contrast, said: “Key to profitability lies in driving input costs down… a shift from maximizing inputs to optimization.”

Navigating 2026: From Maximum Yield to Maximum ROI

Despite the pressure, confidence in farmers themselves remains surprisingly strong.

Between 62% and 80% of respondents believe producers will find a way through, by abandoning the long-held pursuit of maximum yield in favor of maximum return on investment.

January Ag Economists’ Monthly Monitor

(Lori Hayes)

How that transition looks will vary, according to economists and producers, including:

More defensive marketing
Reduced input intensity
Greater scrutiny of every acre
More off-farm income
Tough conversations with lenders

The 2026 ag economy will not be defined by a single policy fix or market rally. It will be shaped by trust, or the lack of it, by how quickly demand can be grown without government intervention and by how much pain producers can absorb before the structure of the industry permanently changes.

Bottom Line for the Ag Industry

The U.S. ag economy enters 2026 in a clear crop-sector recession, but the deeper crisis is one of confidence. High input costs, weak prices, policy uncertainty and eroding trust in data have pushed many producers from planning for profitability into fighting for survival. Economists largely view the downturn as cyclical and manageable through optimization, while farmers experience it as a structural stress test on their operations and livelihoods.

How 2026 ultimately unfolds will depend less on short-term aid and more on rebuilding trust, growing demand without permanent government support and farmers’ ability to preserve cash, adapt quickly and endure a prolonged margin squeeze.

Fertilizer Prices Top List of 2026 Profitability Threats as Global Supply Tightens

Wed, 11 Feb 2026 18:49:12 GMT

When Farm Journal asked economists, farmers and ag retailers what could threaten profitability in 2026 in the latest Ag Economists’ Monthly Monitor , fertilizer prices rose to the top. Despite farmers cutting back on fertilizer and increased political scrutiny, analysts say the odds of meaningful relief remain slim.

“There’s never a moment where I like to say prices can’t come down,” says Josh Linville, vice president of fertilizer at StoneX Group. “Because the second you do that, the market will humble you. But when I look at everything that’s happening globally, and I look at how little time we really have between now and the start of spring, I see a lot more roads that lead to flat or higher prices than I do to lower ones.”

Cutting Back Fertilizer Has Limits

Farmers are clearly responding to high prices, particularly on nutrients where application can be adjusted. Linville says phosphate took the brunt of those cuts last fall.

“If you go back to the fall season, we believe phosphate application in North America was down about 20% from normal,” Linville said at the 2026 Top Producer Summit . “That’s exactly what we expected to see. We had high fertilizer prices, low grain prices and phosphate sitting there saying, ‘I’m the highest-cost input, and I’m variable-rate.’ If you’re a farmer looking to cut costs, that’s where you go first.”

What happens next remains uncertain, and if you ask Linville, that uncertainty itself is a risk to the market.

“The question we don’t know yet is what that means for spring,” Linville says. “Is spring demand down another 20%? Or does some of that fall reduction just get pushed into the spring window?”

Even with reductions, acreage levels keep overall demand elevated.

“At the end of the day, we’re still talking about planting roughly 93 million acres of corn in 2026,” Linville says. “There are people making a very good argument for 95 million acres. I’m not ready to move our team there yet, but even at 93, that’s still a massive amount of demand.”

And for certain nutrients, farmers simply don’t have a choice.

“If you’re going to plant corn, if you’re going to plant wheat, you have to have nitrogen,” Linville points out. “There’s no getting around that.”

“Waning Optimism” on Price Relief

From Rabobank’s perspective, the outlook is growing more discouraging. Samuel Taylor, farm inputs analyst for Rabobank, says hopes for relief on fertilizer affordability are fading.

“To be honest, I think we’re going to be talking about high input prices and poor affordability through most of this year, and even into the third and fourth quarters,” he says. “Some nutrients might see short-term improvement, but phosphate remains the biggest concern.

“There is some optimism around ammonia,” he adds. “We do have new North American capacity coming online, and over a longer time period that should help. But when it comes to phosphate affordability, we actually run the risk that average phosphate prices this year could be higher than last year.”

A Hard Message for 2026

Neither analyst downplays how difficult the current environment is for farmers.

“Farmers should be frustrated. They should be angry, upset, every negative emotion under the sun. When you look at urea relative to corn prices for this time of year, we’ve never seen that ratio this high going back to at least 2018,” Linville says. “Phosphate ratios are as high as ever starting a year.”

And prices are moving the wrong direction.

“Since the first half of December, urea is up about $100 a ton,” Linville says. “UAN looks like it’s about ready to jump. Anhydrous looks like it’s about ready to go. Phosphate is likely to rally as soon as spring demand shows up.”

Taylor is blunt in his assessment, as he thinks it’s unlikely we’ll see fertilizer prices come down.

“I’m fairly bearish on the outlook for input prices coming down,” he says. “In many ways, we’re just kicking the can down the road.”

Phosphate Prices Are Being Set Globally

Both analysts point to phosphate as the clearest example of why fertilizer prices might stay elevated and why the problem is structural.

“When we talk about phosphate, we’re not talking about a lack of competition,” Linville says. “We’re talking about a lack of global supply.”

Production and exports are concentrated in just five countries: China, Russia, Morocco, Saudi Arabia and the United States. China alone dominates global trade.

“Normally, China exports 8 to 10 million tons of phosphate,” Linville says. “In 2025, they exported just over 5 million tons. As we sit here right now, with the information we have, China is not exporting phosphate until August.”

The impact of that absence ripples through the entire market.

“If the world’s biggest exporter is not participating for several months of the year, global prices are going to be higher,” Linville says. “There’s nothing the U.S. can do about that. We move up with the global market.”

Taylor sees the same dynamic playing out, and he doesn’t believe it will resolve quickly.

“China is looking like an unreliable supplier to the global market again,” Taylor says. “When you combine that with geopolitical risks in other key producing regions, this is starting to look much more structural than temporary.”

High Costs Are Forcing Production Offline

Even if demand softens, analysts say prices have a built-in floor because production costs have surged.

“One of the biggest things people miss is intermediate pricing,” Taylor says. “Sulfur prices ran up in the third and fourth quarters, and that’s pulling marginal phosphate production off the market.”

That squeeze is already visible, according to both Taylor and Linville.

“The stripping margins for phosphate producers have collapsed through the floor,” Taylor says. “In certain geographies, the stripping margin, which is essentially your gross margin, is actually negative.”

“We’ve already seen an [Single Superphosphate] facility in Brazil shut down because the cost of production was higher than the value of the finished product,” he says. “If we try to push prices lower from here, you’re not going to get cheaper fertilizer. You’re just going to get less of it.”

In the U.S., phosphate rock availability adds another constraint.

“We only have so much phosphate rock left. Producers aren’t going to mine it at a loss. As soon as you get back to breakeven or worse, production shuts off, and that lost supply fixes the price again,” Linville adds.

Consolidation Isn’t the Whole Story

With fertilizer prices high, consolidation in the industry has drawn increasing scrutiny from policymakers . Taylor acknowledges the frustration but cautions against simplistic conclusions.

“I’m not sure I’m the right person to say whether there are anti-competitive practices,” Taylor says. “But what I do think gets missed in this conversation is the sheer cost of bringing new production online.”

He points to multibillion-dollar investments, long permitting timelines and environmental obligations.

“Look at the Canadian potash expansion projects. We’re talking about $8 billion in capital. Look at retirement obligations at phosphate facilities. Look at the cost of building a nitrogen or ammonia plant today. You need a very strong balance sheet just to survive that process,” Taylor says.

That reality creates economies of scale that are difficult to avoid.

“We do need some semblance of consolidation,” he adds. “That’s not necessarily the answer farmers want to hear, but if you aim for total self-reliance, particularly in potash, you might actually end up paying more, not less.”

Nitrogen Shutdowns Aren’t Manipulation

Accusations of intentional supply restriction are especially common in nitrogen markets. Linville, who previously worked for a nitrogen manufacturer, pushes back on that idea.

Plant outages, he says, are often misunderstood and planned shutdowns are often a safer option.

“You either shut it down with the people, the parts and the plan in place, or you wait for something to break, and then it’s down even longer,” Linville exp From the outside, it can look like manipulation. From the inside, it’s just reality.”

Policy Is Blurring Market Signals

Taylor says domestic policy is also preventing markets from correcting.

“Government support is blurring the demand falloff we might otherwise see, and that demand destruction is often what helps correct prices,” Taylor says.

But then when you throw in trade policies, Taylor says that adds another layer of cost.

“We’ve seen reciprocal tariffs, countervailing duties and those costs are passed straight through to farmers,” Taylor says. “There are mechanisms within our control that could help, but there’s very little we can do about Chinese domestic policy or geopolitical conflicts in the Middle East, which sit right at the heart of global fertilizer production.”

What Farmers Need to Know for 2026

Despite the frustration, both analysts stress discipline.

“My advice is always the same: Farm to return on investment, not to yield,” Taylor says.

“Be emotional right now, that’s human,” Linville adds. “But when it comes time to make decisions for your fields or your marketing, leave that emotion at the door. That’s where people get hurt.”

For now, fertilizer remains one of the biggest threats to farm profitability in 2026 and one that might not offer easy relief.

Economists Forecast Farm Economy to Stabilize, But High Costs and Policy Uncertainty Block a 2026 Rebound

Wed, 07 Jan 2026 18:26:37 GMT

As 2026 ushers in a fresh start, agricultural economists say the U.S. farm economy has stopped sliding, but it’s far from fully healed.

The December Ag Economists’ Monthly Monitor shows month-to-month sentiment is improving, but deep structural strain remains — especially in row crops. Meanwhile, livestock markets continue to provide strength. Crop producers face another year of tight margins driven by high input costs, weak prices and unresolved trade and policy uncertainty.

“There’s cautious optimism,” the economists say, “but very little belief that 2026 will bring a meaningful rebound without cost relief or stronger demand.”

Those themes mirror the perspective of Seth Meyer, former USDA chief economist and now director of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri. In a recent interview, Meyer connected the dots between narrow margins, policy responses and what might actually move the dial for U.S. agriculture heading into 2026.

Stabilizing, Not Recovering

December Ag Economists’ Monthly Monitor

(Lori Hayes )

Economists see the ag economy holding its ground — but not gaining strength.

54% say the ag economy is somewhat better than one month ago.
Compared with a year ago:
- 42% say conditions are worse
- 33% say they are better
Looking ahead 12 months:
- 46% expect conditions unchanged
- 38% expect improvement
- 15% expect conditions to worsen

“Momentum has improved since mid-2025,” Meyer notes, “but tight margins have been with us for a long time. Turning that around requires demand growth, not just price stabilization.

Farm Journal’s December Ag Economists’ Monthly Monitor

(Lori Hayes )

Grant Gardner, assistant Extension professor at the University of Kentucky, tells AgriTalk’s Chip Flory: “I think as we move into kind of this next marketing year, you’re looking at what looks like a breakeven and not a loss, but breakeven still doesn’t look great after three years of breakeven or losses.”

He says even with the $11 billion in Farmer Bridge Program payments , it won’t drastically change the outlook for the farm economy.

“Purdue had a good survey about a month ago, where they looked at what were these payments going to go to, and research would show that a lot of these payments go into long-term assets, and so land tractors, but I think over 60% of producers right now are in such a tight cash crunch that you’re going to see a lot of these payments go into that short-term debt,” Gardner says.

Consolidation a Growing Threat

Economists are nearly unanimous that the crop sector remains under extreme financial stress. 83 percent say row crops are currently in a recession. That isn’t about production declines — acres and yields haven’t collapsed — but about persistently weak profitability.

“Negative returns for at least the third consecutive year across nearly all row crops,” one economist wrote in the survey.

Another said: “Margins remain below full costs of production for many producers.”

Farm Journal’s December Ag Economists’ Monthly Monitor

(Lori Hayes)

Meyer traces that back to how abruptly agriculture moved from the high prices of 2021 and 2022 into today’s tighter margins.

“We moved very quickly from a very high price environment and good profitability in 2022 to very tight margins,” he says. “That usually happens coming off price peaks, but this time it happened really rapidly.”

A minority of survey respondents argued farms are “treading water,” supported by strong land values and government aid rather than eroding further, which Meyer acknowledged aligns with how risk and safety nets have interacted this year.

But when you look at how the current stress in the farm economy could impact consolidation, the ag economists say it’s the economic pressure combined with demographic trends causing the acceleration. In fact, 92% of them say consolidation is underway and unavoidable.

“Markets go to the lowest-cost producers,” one economist wrote. “That sorting is consolidation on the production side.”

Aging producers exiting and rent-heavy operations under pressure only add fuel to that trend, with one economist saying: “Consolidation happens because producers have to exit, not because they want to.

What’s Driving the Farm Economy Right Now

When economists were asked to identify the two most important factors shaping agriculture’s economic health today, their responses clustered around a familiar, but increasingly sharp, divide: strong demand in livestock and the protein sector versus persistent oversupply and cost pressure in crops, all layered with trade and policy uncertainty.

Several economists pointed to continued strength in beef demand, both domestically and through export channels, as a key stabilizing force. While the dairy sector is an area that shows signs of weakness for 2026.

“Livestock revenues are a bright spot,” one respondent noted, underscoring why the livestock sector continues to outperform crops financially.

Looking to 2026, economists overwhelmingly point to input costs, not interest rates, as the biggest barrier to profitability. Nearly 70% cited input prices as the largest challenge as well, far ahead of trade concerns or capital availability.

Farm Journal’s December Ag Economists’ Monthly Monitor

(Lori Hayes )

“We have too much supply and not enough demand for row crops,” one economist wrote.

Another said: “Input costs are still too high.”

Trade remains a central wild card, especially relationships with China and uncertainty around global supply. Several respondents cited trade disputes and agreements as critical factors, along with questions about the size of South American crops and how that could shape global competition in the months ahead.

Policy uncertainty was also featured prominently, with economists pointing to domestic biofuels policy, government payments and broader market signals as factors influencing both short-term cash flow and longer-term demand growth.

Overall, economists say the ag economy is being pulled in opposite directions: strong livestock demand providing support, while crops struggle under high costs, oversupply and unresolved trade and policy questions — a dynamic that helps explain why the broader farm economy feels stable, but far from healthy, as 2026 approaches.

Livestock: A Continued Bright Spot

Livestock continues to stand out as the most financially healthy segment of the ag economy. Every economist surveyed rated beef as above average or excellent, supported by strong domestic demand and tight supplies. Dairy and pork were viewed as stable to moderately strong.

That success creates a stark contrast with row crops, where corn and cotton were cited by 38% each as the commodities most at risk financially in 2026.

What Could Move Crop Prices in the Next Six Months

Looking ahead to the first half of 2026, economists say crop prices will hinge less on domestic fundamentals and more on global supply, trade flows and policy clarity.

Across responses, South America emerged as the dominant influence, with economists repeatedly citing Brazilian weather, the size of the South American harvest and how those supplies compete with U.S. exports. Several noted that clarity around South American production will be critical in setting price direction for corn, soybeans and wheat.

Trade, particularly with China, remains another key swing factor. Economists emphasized not just the announcement of trade agreements, but whether purchases translate into actual shipments.

“China purchases of U.S. crops, but also if and when actual shipments occur,” one respondent noted, adding that details within any trade deal, including purchase commitments, will matter just as much as headlines.

Domestic factors still play a role, but economists see them as secondary in the near term. Input prices, early U.S. planting conditions and assumptions about 2026 acreage were all cited as important — especially as markets begin to trade expectations for next year’s crop mix.

Policy uncertainty also hangs over the outlook. Economists pointed to ongoing questions around trade policy, biofuels policy and broader economic conditions as variables that could amplify or mute price moves.

Economists say crop prices over the next six months are likely to be driven by how global supply unfolds, whether export demand materializes and how quickly policy uncertainty is resolved, rather than by any single domestic production shock.

Biofuels Policy: A Potential Turning Point?

One of the clearest themes Meyer highlights as a possible game changer for demand, and ultimately prices, is biofuels policy.

For economists, policy levers like year-round E15, Renewable Fuel Standard (RFS) volumes, 45Z investment tax credits and how small refinery exemptions are handled could meaningfully influence demand for corn and soybeans in 2026 and beyond.

“It’s one of the places where policymakers actually have levers to help with tight margins in the row crop sector,” Meyer says.

He emphasizes that final rules on RFS volumes and how biobased credits are implemented could impact feedstock demand.

“For the next couple of crop seasons, RVO (Renewable Volume Obligations) and how EPA reallocates small refinery exemptions are big factors,” Meyer says. “Should we raise the RVO to soak up that pool like a sponge? Should imported feedstocks get full 45Z credit? Those decisions could move demand.”

On year-round E15, a long-sought policy priority for corn growers, Meyer is cautiously optimistic.

“I do think it matters,” he says. “Maybe it’s not a huge swing this year, but offering certainty and building demand over multiple seasons is supportive. Other countries like Brazil are ramping up their biofuels production too, so this isn’t happening in a vacuum.”

Policy Uncertainty Still Looms

Economists also flagged top priorities for 2026 policy action:

Year-round E15 (row crops)
Trade policy clarity (row crops & livestock)
Labor reform and regulatory issues (livestock)

They also highlighted under-covered risks, which include pressure on land rents and values, labor shortages, biofuels policy details (such as 45Z credits) and slower population growth affecting long-term demand.

What Could Move Livestock and Dairy Prices in the Next Six Months

When economists look ahead to livestock and dairy markets in early 2026, they see a mix of strong demand signals, supply-side risks and policy uncertainty shaping price direction.

Consumer demand remains the cornerstone of the outlook, particularly for beef. Several economists pointed to continued buying interest from U.S. consumers as the primary support for cattle prices, even as affordability pressures rise. At the same time, some warned that a more “K-shaped” economy could begin to shift demand, pulling some consumers away from beef and toward pork.

Supply dynamics and herd trends are another major focus. Economists cited herd size, potential herd expansion and the availability of feeder cattle as critical variables. The expected resumption of feeder cattle imports from Mexico was highlighted as a key factor that could influence cattle supplies and pricing, depending on timing and volume.

Animal health risks also remain on the radar. Issues such as avian influenza, screwworm and other disease threats were mentioned as potential disruptors that could quickly alter supply conditions in both livestock and dairy markets.

Policy and trade uncertainty continues to hover over the sector. Economists pointed to ongoing questions around tariffs, restrictions on live animal trade with Mexico and the next steps under the USMCA as factors that could impact both imports and exports. Political uncertainty more broadly was also cited as a potential source of market volatility.

For dairy, economists noted that beef-on-dairy dynamics are likely to continue weighing on milk prices by increasing beef supplies while complicating dairy herd decisions.

Taken together, economists say livestock and dairy prices over the next six months will be driven by a delicate balance between strong consumer demand, evolving supply conditions and unresolved trade and policy questions, with any shift in one of those areas capable of moving markets quickly.

Acreage Expectations: Stress, Not Shock

Despite margin pressure, economists do not expect dramatic acreage pullbacks in 2026. Most expect:

Corn: 93 to 95 million acres
Soybeans: 84 to 86 million acres
Wheat: 44 to 45 million acres
Cotton: 9 to 10 million acres

Corn acreage expectations have edged lower since November, as economists backed away from another year above 95 million acres. At the same time, soybean acreage expectations have firmed, with 75% now targeting 84 to 86 million acres, suggesting stronger relative economics for beans.

“Export demand has helped keep corn acres supported,” Meyer says. “The question is whether that demand holds and whether policy supports it.”

As for acreage, the major impact on prices would be a large acreage reduction, which is unlikely.

“That’s what it comes down to, too. What I’ve been thinking about is what else can you use land for? And you’ve got the pushback on urban sprawl, you’ve got pushback on other uses for ag land. But right now, the simple fact is we’ve got way too much production. Without that slowing, or a drastic increase in demand, I don’t see prices improving to very lucrative levels,” Gardner says.

Overall, The Ag Economy Is a Grind, Not a Rebound

When you look at all the results from the December Ag Economists’ Monthly Monitor, economists paint a picture of an industry that has stopped getting worse, but has not yet found a path to durable profitability.

Crops remain mired in margin compression; livestock continues to outperform but remains sensitive to policy decisions. Government aid is buying time but not addressing structural challenges, but it’s policy outcomes, especially around biofuels, trade and E15, that could be decisive in shaping 2026 outcomes.

For now, the farm economy has found a floor. The tougher question, economists say, is whether policy can help lift it, or if it will continue to grind forward without a genuine rebound.

Related News: As Screwworm Inches Closer, When Could the U.S. Reopen the Southern Border to Cattle Imports?

As Screwworm Inches Closer, When Could the U.S. Reopen the Southern Border to Cattle Imports?

Tue, 06 Jan 2026 20:49:10 GMT

A newly confirmed case of New World screwworm (NWS) in northern Mexico is renewing concern among U.S. cattle producers and policymakers, as the parasitic fly continues to inch closer to the U.S.-Mexico border.

As reported by Drovers, on Dec. 27, Mexico’s National Service of Agro-Alimentary Health, Safety, and Quality (SENASICA) reported a case of NWS in a 6-day-old calf with an umbilical lesion in the municipality of Llera, located in the state of Tamaulipas. The location is approximately 197 miles south of the U.S.-Mexico border, and a reminder that NWS is still a high threat to the U.S.

Critical Timing with Calving Season Approaching

NWS, which was eradicated from the U.S. in the 1960s through an extensive sterile fly program, poses a serious threat to livestock. The larvae infest open wounds, feeding on living tissue and often leading to severe injury or death if untreated. Calving season is considered a particularly vulnerable period due to natural points of entry such as navels and birthing injuries.

Seth Meyer, director of the Food and Agricultural Policy Research Institute (FAPRI) and former chief economist for USDA, says the new case raises a tremendous amount of concern as USDA remains vigilant on keeping NWS out of the U.S. But Meyer says the growing proximity of NWS complicates already difficult decisions for cattle producers at calving season , which is a critical time of the year.

“There are concerns not just from a consumer standpoint, but also about whether southern producers are willing to retain heifers during calving season if there’s a risk of fly exposure,” he says. “Calving is a point of access for these animals, and that risk matters.”

Those decisions could have longer-term implications for herd expansion and cattle supplies, Meyer notes. If producers decide the risk is too great and opt against retaining replacement heifers, it could tighten supplies further down the road.

“That’s the last thing you want,” Meyer says. “You don’t want people giving up on retaining heifers and turning away from herd rebuilding.”

The Possibility of Reopening the Southern Border

The U.S. most recently closed its southern border to Mexican cattle imports in May of 2025 due to the rapid spread of NWS in Mexico. There were additional closures and reopenings in July 2025 as the situation evolved ultimately halting trade again to protect U.S. livestock.

Here’s a timeline so far:

November 2024: NWS was first detected in southern Mexico, leading to initial border closures and trade disruptions.
Feb. 1, 2025: A temporary ban was lifted after agreements for inspections.
May 11, 2025: U.S Secretary of Agriculture Brooke Rollins ordered an immediate suspension of imports due to NWS spreading closer to the border.
July 2025: A phased reopening began but was halted again after new NWS cases were found farther north, leading to another immediate closure of southern ports to protect American livestock.

Considering the cattle just south of the border are being vigilantly monitored and inspected, the bigger threat of NWS crossing the Southern border could be through wildlife . Still, as NWS gets closer, USDA is keeping the border closed and remaining cautious.

When could the U.S. reopen the border? That’s exactly what Farm Journal asked economists in the latest Ag Economists’ Monthly Monitor and the responses were extremely mixed. It’s important to note the survey was sent out prior to the most recent detection of NWS.

33% of economists say USDA could reopen the border in February 2026
25% say it could happen April through June
17% think the border could reopen July through September
And 17% were unsure.

For policymakers, the situation adds another layer of complexity as they balance animal health, trade and producer confidence. While officials stress that there is no immediate threat to the U.S. herd, the latest detection underscores the importance of surveillance, rapid response and continued cooperation between U.S. and Mexican animal health authorities.

As Meyer puts it: “There are a lot of balls in the air right now,” and preventing NWS from crossing the border remains a critical priority for the livestock industry on both sides.

Follow Farm Journal’s extensive coverage of the ongoing NWS situation.

Where Could Farmers Spend Bridge Assistance Payment Dollars?

Tue, 06 Jan 2026 20:18:56 GMT

With USDA’s and Agriculture Secretary Brooke Rollins’ Dec. 31 announcement detailing rates for Farmer Bridge Assistance Program payments , set to be distributed by Feb. 28, there’s the matter of how farmers will spend the funds.

“If we look at it as a share of revenue, it looks around 5% to 20% for different farms. So, it’s meaningful, it’s something, but it might not necessarily change the picture for all of the farmers,” says Wes Davis, chief ag economist at Meridian Agribusiness Advisors.

Davis estimates the payment rate per acre for corn is about $0.25 per bushel and $0.62 per bushel for soybeans.

Per the Purdue/CME Group Ag Economy Barometer earlier this fall, when asked how they’d spend potential government payments, 53% of farmers said they would use the money to pay down debt.

(Purdue Center for Commercial Agriculture)

“Farmers are getting that debt off their books and concentrating on reducing their payment rates,” Davis says.

This, he adds, is supported by data from the Kansas City Federal Reserve indicating a growing segment of farmers selling mid-to-long-term assets to improve working capital or pay down debt.

(KC Federal Reserve Bank)

One-quarter said the money would go toward improving working capital.

“So, farmers may have more funding available to spend on inputs as the spring buying season starts,” Davis says.

From Farm Journal research, 75% to 80% of farmers have input decisions made by the end of February, when farmers expect to receive bridge program payments. Davis says this means the program won’t have substantial changes in seed or fertilizer purchases but will most likely have an effect on crop protection purchases.

From the Purdue research 12% and 11% of farmers, respectively, said it could be used to invest in machinery and cover family expenses.

Respondents in the latest Farm Journal Ag Economist Monthly Monitor warn the payments may help with short-term cash flow, but could delay market adjustments.

“Payments will prolong high input costs and land values,” one respondent said.

When economists in the Farm Journal Monitor were asked if they expect the Farmer Bridge Payments to sufficiently cover financial losses experienced by farmers in 2025:

54% said the payments are “partially suﬃcient , the aid will cover some but not all losses.”
38% said, “The aid will be insuﬃcient to cover losses.”

When followed-up with, “What impact, if any, do you expect the bridge payments to have,” economists said:

May help pay down current operating loans for some and for others, help get a start on 2026 inputs
All players in the farm supply chain know about the payments and will know the exact payment rates. The payments will prolong high input costs and land values/rental rates. Any adjustments that should occur from an economic perspective are delayed because of the cash influx.
Support cash rent and land values
The payments will help producers with short-run cash flow issues. They will not help encourage needed adjustments in rental rates and other production expenses.
They will help pay down debt for most producers, providing a much needed boost the the agricultural lending sector.
It will help the younger producers that don’t have the capacity to roll operating loans, but many of the dollars will flow-through to input suppliers. That delays what should be a downside correction in input prices.

“A lot of this money — half of it — is just going to be a simple pass-through,” Davis says. “So, farmers have already spent it on that debt; they’re going to use it to pay down those balances. It might actually reduce the amount of interest payments that farmers have over the next season, but for it to pass through and increase the spending on some of their inputs or equipment or potentially land, that’s not really showing up in the data that we’re seeing, and farmers are not telling us that’s what they’re going to go and use the funding for.”

The bridge program is an economic assistance program, not a tariff relief program.

Seth Meyer, the former USDA chief economist and now director of the Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri. explains the intent behind the $11 billion in farmer bridge payments that were announced late in 2025: they weren’t designed to offset trade losses, but to bridge producers to the point where long-standing safety nets take effect.

“These were calculated based on shortfalls in cost of production, not trade impacts,” he tells Farm Journal. “If this is going to be a bridge payment, it needs to be quick. That’s why an ECAP-style approach made sense, it could be administered fast.”

Davis says is an important distinction.

“If you look at the last trade war that we had, there were payments, and they were directly tied to the price impact and the actual damage that was done to farm prices,” he says. “Potentially, it leaves some options open for the administration to add funding that does supplement those prices. We’ve heard chatter over time that there may be another round of payments or funding available over the next year. I think that leaves the window open for trade relief if this is positioned as economic relief, with inputs staying well above the level that they were even five years ago.”

One big question remains.

It’s how the program will support specialty growers. USDA announced an additional $1 billion for specialty crop growers, but further details on timing and eligibility have not been released.

“Analysis from the American Farm Bureau showed almost every single major specialty crop is in the red by 1x to 2x what they have been historically,” Davis says. “Figuring out how that payment will be distributed to those growers will be really important.”

AFBF notes specialty crops account for more than one-third of U.S. crop sales: $75 billion.

Meyer also acknowledges a smaller $1 billion pool for specialty crops and sugar poses challenges: “With the diversity in specialty crop areas, it’s much more complicated to implement, how do you cover all of that efficiently?”