Farm Economy

New Study Shows E15 Isn’t a Silver Bullet for Farm Income

Tue, 12 May 2026 19:37:31 GMT

As the House prepares to vote on year-round E15 , there’s a new study out from the University of Missouri’s Food and Agricultural Policy Research Institute (FAPRI) , and it’s is giving agriculture and biofuels groups an early look at what expanded year-round E15 sales and changes to Small Refinery Exemptions (SRE) could mean for farmers and rural America. While there are positives for ethanol and corn demand, the report also highlights some clear tradeoffs, especially for soybean oil, biodiesel and even short-term farm income.

According to FAPRI Director Seth Meyer, the study’s clearest takeaway is that year-round E15 alone doesn’t dramatically reshape the farm economy in the near term, but proposed changes to small refinery exemptions could pressure farm income while increasing government spending.

Meyer says the headline is pretty straightforward. The biggest market disruptions in the analysis don’t actually come from allowing year-round E15 sales. Instead, the larger economic consequences show up when the House proposal to reduce SRE reallocations gets layered into the equation.

“The key of the report is that E15 itself is not, at least in the short term, a major disruption to the market in terms of producer incomes or government costs,” Meyer says. “It becomes mostly a tradeoff between corn and soybeans.”

SRE Allocations Changes the Story

But Meyer says the story changes once the House proposal on SRE reallocations enters the picture.

In FAPRI’s modeling, reducing the amount of waived refinery obligations that get redistributed across the rest of the refining sector effectively lowers Renewable Fuel Standard volumes. That shift weakens biofuel feedstock demand and creates more pressure on soybean markets and farm income.

“It is the addition of the small refinery exemptions and the proposal to not reallocate 75% of those obligations that government costs we track begin to rise and farm income begins to fall,” Meyer explains. “Those SREs are the main drivers of government costs and reductions in farm income because they are, in effect, a reduction in the RVOs or mandates.”

The FAPRI analysis looked at three scenarios tied to HR 1346, the Nationwide Consumer and Fuel Retailer Choice Act:

E15 expansion alone
E15 plus 600 million gallons of SRE reductions
E15 plus 900 million gallons of SRE reductions

Under the model, E15 adoption gradually grows by 0.25% annually, eventually pushing the average ethanol blend rate to 13% by 2035. That increase would add roughly 2 billion gallons of domestic ethanol use by the mid-2030s, while simultaneously changing the balance between ethanol and biomass-based diesel under the RFS structure.

What Happens to Corn and Soybeans?

FAPRI’s findings show E15 expansion boosts corn demand and corn acreage over time. By 2035, corn prices rise about 14 cents per bushel versus baseline levels, with additional corn acres pulled into production as ethanol demand expands.

But, according to the report, the gains for corn do not translate evenly across the broader crop sector. As ethanol demand rises, biomass-based diesel demand weakens, which directly pressures soybean oil values and eventually soybean prices. That’s especially true under the SRE scenarios, where lower mandated renewable fuel volumes further reduce demand for biodiesel feedstocks.

“So while corn may benefit, a reduction in the RVO has negative implications for soybeans that outweigh those corn benefits,” Meyer explains.

The report projects soybean prices could fall between 38 and 43 cents per bushel by 2035, depending on the SRE scenario. Soybean acreage also trends lower throughout the projection period as acres shift toward corn production.

Meanwhile, soybean oil prices take an even larger hit because biodiesel absorbs much of the downside under reduced RFS obligations. Meyer says that dynamic is rooted in how current mandates are being met today.

“You see bio-based diesel decline in all cases because, at the moment, the majority of the marginal gallons to meet the mandates are biodiesel,” Meyer says. “If you expand the small refinery exemptions, those volume reductions are no longer a tradeoff between ethanol and bio-based diesel, but a reduction in the marginal gallon, which is bio-based diesel.”

Farm Income Turns Negative Before Recovering

One of the more notable findings in the study is that net farm income trends negative for several years under the SRE scenarios before eventually recovering later in the outlook period. While stronger corn demand helps offset some losses, it isn’t enough in the early years to counter the broader drag from weaker soybean and bio-based diesel markets.

Under the larger 900-million-gallon SRE scenario, net farm income falls by as much as $1 billion annually during the early 2030s before improving later in the decade. FAPRI also projects higher government outlays under the SRE scenarios as weaker commodity prices trigger additional farm program support.

Meyer says soybean losses are the biggest driver behind the weaker farm income projections. He also notes that ripple effects extend into livestock feeding costs because of tighter soybean meal supplies and higher corn demand.

“The notable driver in the outcome is the losses for soybeans as the SREs cut mandates,” he adds.

The livestock sector also sees higher feed costs as corn demand rises and soybean meal supplies tighten. Over time, those higher feed costs work their way through animal agriculture and eventually impact consumer meat prices as producers adjust inventories and production decisions.

Key Points From the Study

E15 expansion alone modestly boosts corn demand with relatively limited disruption to overall farm income.
Reduced SRE reallocation lowers effective RFS mandates and creates the largest negative impacts on crop receipts and government outlays.
Biomass-based diesel demand declines more sharply than ethanol demand under the proposed changes.
Corn acreage rises while soybean acreage falls across all scenarios.
The long-term outcome depends heavily on how quickly E15 adoption actually happens — and whether EPA eventually expands the conventional ethanol “gap” above 15 billion gallons.

That final point may be one of the biggest wildcards in the entire discussion, said Meyer. FAPRI’s analysis assumes the conventional ethanol portion of the Renewable Fuel Standard effectively remains capped near 15 billion gallons. If EPA policy or future legislation allows that cap to move higher, the economics for agriculture could look considerably different.

“You call out a very important assumption,” Meyer says. “If the passage of E15 were to drive an expansion of that 15-billion-gallon conventional gap to 16 or 17 billion gallons and raise total mandates by that same amount, this would increase benefits or reduce losses in the ag sector across all the scenarios.”

The Biggest Unknowns

Meyer says there are still several major uncertainties surrounding both E15 adoption and how EPA ultimately implements future RFS obligations. Those unknowns could significantly alter how these market impacts unfold over the next decade.

“I don’t think there is a single assumption on this complicated issue, so let me state three,” he adds. “First is the true path of E15 expansion and more importantly, the second is how that might drive changes in mandates as a result. Third, what is the true volume of exemptions that would result from the legislation? Because we don’t have this information, we did two scenarios.”

The pace of actual consumer adoption also matters. While the model assumes gradual E15 growth over time, Meyer says a slower adoption curve would likely soften some of the corn demand benefits while making the negative impacts tied to SRE reductions more apparent.

“If growth in E15 is slower and we look just at the ‘clean’ E15, it just changes the amount of tradeoffs between corn and soybeans,” Meyer said. “But if we had slower E15 growth with SRE reductions, we would show more negative impacts on crop prices and farm income from the SREs.”

The New Ag Economy: Why This Downturn is a Structural Shift, Not Just a Cycle

Mon, 13 Apr 2026 21:22:16 GMT

What You Need to Know:

Structural Evolution: This downturn is a permanent market shift, not just a temporary cycle.
Friend-Shoring: Trade is moving toward geopolitical allies to ensure supply chain resilience.
Aggressive Cost-Cutting: Farmers are doubling generic input use and delaying machinery purchases to protect margins.
Financial Resilience: Better management and working capital make today far more stable than the 1980s.
Premium Protein Demand: GLP-1 medications are driving consumers toward smaller, higher-quality meat portions

As the industry enters the third year of this downturn, farmers and agribusinesses are questioning if a recovery is on the two-year horizon. While cyclical behavior is normal, two economists suggest the structural evolution within crop protection, machinery, technology, livestock and other individual sectors is creating a different kind of staying power for those who survive the recovery.

The Evolution of the Cycle

When characterizing the current economic cycle in agriculture, historical patterns provide a necessary baseline, yet the present landscape is defined by unique pressures. Typical agricultural cycles consist of roughly six years of expansion followed by four years of decline. Currently, the market is navigating a “corrective period,” returning to long-run averages.

The drivers of growth are typically demand shocks — export surges, fuel demand or policy shifts such as the Renewable Fuel Standard. However, Wes Davis, ag economist at Meridian Ag Advisors, notes the current environment is an intersection of traditional contraction and sector-specific evolution.

“What I think we’re experiencing right now is that typical cycle behavior where we see growth in some business firms, and then some contraction and pullback to adjust to the cycle going back to more of the long-run average,” Davis explains. “I think we’re also seeing evolution of individual sectors within the market where there’s adjustments happening because of the industry itself.”

In other words, this isn’t just a cycle — it’s also a structural shift.

Change Fatigue and Modern Volatility

Farmers aren’t strangers to volatility, but global trade disruptions, policy shifts and rising competition, especially from Brazil, are layering uncertainty onto already volatile markets.
Farmers are grappling with “change fatigue,” a byproduct of the high velocity of information and extreme price swings that dwarf the relative stability of the early 2000s.

“When I go talk to any industry group right now, the phrase that I hear is ‘change fatigue’, and I feel that. Every couple minutes, something shifts,” says Trey Malone, Purdue University ag econ professor. “But to be clear, it’s not that the farm economy isn’t used to volatility, it’s just the uncertainty and the volatility now is, like, ‘hold my beer relative’ to the old volatility.”

Malone attributes this to layers of uncertainty created by global trade and policy. The rise of Brazilian production, coinciding with the disruption of U.S.-China trade relations, has created a permanent state of flux. This sentiment is reflected in the Purdue Ag Economy Barometer, which shares a higher correlation with the Small Business Index (.5) than with actual commodity prices. This suggests farmers view themselves primarily as small business owners facing broad economic pressures rather than just price-takers.

“We don’t see very strong correlations even with lagged soybean prices and corn prices,” Malone notes. “The world is more complicated than just looking at what happened in the market yesterday and gauging how farmers feel.”

Global Competitiveness and the Trade Reallocation

A primary concern for U.S. producers is their position as low-cost providers. While the U.S. maintains an infrastructure advantage that lowers the cost of getting products to export ports, Brazil continues to close the gap.

“It’s a fair question farmers ask a lot: Are we actually the ones who are the low-cost producers, and do we still have a place in the global market if Brazil continues to lower the cost of production and transport their grain to export terminals?” Davis asks.

However, Davis points out that global trade hasn’t shut off; it has reallocated. Only three global regions — North America, Latin America and parts of Southeastern Europe/Central Asia — are net exporters. The rest of the world remains net importers.

“While our trade has kind of shifted around ... that shift has really reallocated stuff in different places. Those calories and products end up going somewhere. It’s just a question of where,” he says.

The Shift to “Friend-Shoring” and Resilient Supply Chains

The industry is moving from “just-in-time” (hyper-lean) procurement to “just-in-case” (inventory-heavy) strategies, a lesson reinforced by the pandemic. This shift is accompanied by “friend-shoring,” where the U.S. prioritizes trade with geopolitical allies.

“We’ve gone from offshoring to onshoring to nearshoring to friendshoring,” Malone explains. “We’ve got a paper that’ll be coming out ... where we document friend-shoring in ag and food supply chains. Over the last 10 years, there’s been a shift where we mostly in the U.S. trade with other people who vote like us in the WTO. That’s kind of one way to measure friends.”

This resilience is also visible in crop protection. In 2019, 80% of active ingredients were sourced from China. Today, that is closer to 60%, with manufacturing shifting to India and domestic sites. Davis calls these “geopolitically resilient” supply chains.

The Rise of Generics and Decision Paralysis

The economic downturn is fundamentally changing the business model for input providers. Farmers are aggressively cutting costs, leading to a massive surge in generic usage.

“The latest survey I saw shows about 60% of farmers use generics today. That was about 30% to 40% just 5 years ago,” Davis says. This forces companies to pivot from differentiation to operational volume.

In the machinery sector, high costs and economic uncertainty have led to “decision paralysis.” Farmers are extending the life of their equipment, treating machinery replacement as the most controllable variable in managing annual ROI. Davis notes the U.S. ag equipment cycle is currently 15 to 20 percentage points lower than typical low points, driven by this hesitation. Furthermore, there is significant skepticism toward subscription-based technology models.

“Farmers don’t terribly love this idea, and I think the other interesting thought here is I’m not sure that retailers like selling them either,” Malone adds.

AI: The “Undergraduate Intern”

While artificial intelligence (AI) is a major talking point, its current role in agriculture is more supportive than transformative. Malone views AI as a “highly capable undergraduate intern” — useful for processing information but incapable of replacing the trust and risk management provided by human advisors.

“I don’t think you need to be replacing your agronomist. I think your mediocre agronomist just got OK,” Malone says, noting while LLMs can pass CCA exams, they cannot manage the risk of a wrong decision. “The risk management value proposition of an in-person Claude, or whoever, is probably going to win out because there’s still a risk.”

Currently, the adoption gap is wide: While 75% of agribusiness managers see potential in AI, only 4% have implemented it, according to a Purdue University survey in 2025.

Livestock and the GLP-1 Impact

The livestock sector is facing a unique demand shift driven by weight-loss medications (GLP-1s). This is leading to “premiumization.” As consumers eat smaller portions, they are opting for higher-quality cuts.

“The explosion in demand for protein is just shocking,” Malone says. “What GLP-1s do to that calorie count is they are all shifting toward premium cuts. You don’t care how much it costs because you’re only going to have seven bites of it. But you’re going to have a steak. That premiumization is going to really, really take off in the next 10 years.”

Conversely, the hype surrounding “fake meat” has largely faded, proving to be more of an investor-led phenomenon than a market-driven one.

Financial Stability: Not the 1980s

Despite the downturn, the financial health of the American farmer remains more stable than during the crisis of the 1980s. Currently, 10% to 12% of farmers are in a “tight” financial position , compared to 20% to 30% in the 80s.

“We do have a completely different, more professional ag workforce than we did back then,” Malone says. “The farm policy we have right now does not necessarily match what we need for the future, but all of these things make me think we’re in a much more stable position.”

Farmers have built-in “shock absorbers,” Davis adds, including off-farm income and working capital built up during the expansion years. However, in his research Davis has seen how alternative financing is becoming a major tool for the 50% of farmers who use it — either to manage stress or, for larger operations, to leverage relationships with retailers.

Strategic Reassessment: Winning at the Bottom

The experts agree the “bottom of the cycle” is the time for professionalization and upskilling. Surviving — and thriving — will require sharper management. It is an opportunity to reassess farm transitions and management disciplines, such as financial management, accounting and planning, which become critical in tight margins.

“Farmers are going to have to get smarter and get more creative with how they manage,” Malone says. “This is a good opportunity to take a step back and think about what the strategy needs to be moving forward.”

Davis emphasizes relationships are solidified during these periods: “Farmers are going to remember the folks who were around when they were in the bottom of the cycle, and who were there to support them. The best farmers will continue to get better ... I get excited about what we can look like as we come out of this cycle.”

So Is This Ag Cycle Different?

These experts say yes as every cycle presents its own unique reshaping of future opportunities.

To download the full report on why this ag cycle is different and what it means for your operation, click here .

The Shrinking Slice: Farmers Receive Less Than 6 Cents of Every Food Dollar

Tue, 31 Mar 2026 20:30:40 GMT

For the past two years, USDA has estimated farmers and ranchers received less than 6 cents of every food dollar. In 2023, that was 5.9 cents, and using the latest data from 2024, it’s 5.8 cents.

“Our oldest data point right now is 2007 [USDA updated the data series] and that’s 14.7 cents per dollar, and now we’re down all the way to 11.8 cents per dollar,” says Faith Parum, economist with the American Farm Bureau Federation. “So we’ve really seen that decline year after year. It reflects how much of the value of things in the grocery store or when you go out to eat is going to other parts of the supply chain and not necessarily to farmers and ranchers.”

Livestock vs. Crops: A Widening Gap

The aggregate decline masks a widening gap between sectors. While the overall farmer share is down, livestock and crop producers are seeing divergent trends:

Crop Farmers: Share dropped from 2.9 cents to 2.5 cents (a 2.5% year-over-year decrease).
Livestock Producers: Share increased from 3 cents to 3.3 cents.

“Overall, the farmer share is down. But we have those two markets really at odds,” Parum says. “We’ve seen that tale of two farm economies where our livestock producers maybe have seen a little bit of better days than they had had in the past, while our row crop farmers and our specialty crop farmers are really facing strong headwinds in the market.”

Effect at the Farm Gate

As highlighted by USDA, farm finances are quickly strained when farmers/ranchers are capturing a small percentage of the food dollar and even modest swings in commodity prices and/or input prices take place.

Parum adds, “when we talk about the health of our farms and the health of future generations on the farm, and being economically viable and sustainable and being able to keep their operations open, the trends we’re seeing right now are really hard for those farmers. Our ranchers are seeing a little bit of better days right now with high beef prices, but that’s not going to last forever, and with production expenses continuing to increase, we’re really going to see that that question come up of, what is sustainable if, if these dollars we’re spending in the grocery store aren’t making it back to our farmers.”

Where Does the Money Get Distributed?

The key takeaway: farmers produce the raw commodities that make food production, however, the price is clearly more determined by what happens after the products first leave the farm.

The USDA Food Dollar Series tracks how each dollar is spent by consumers and then divides it across the industries contributing to the value in the supply chain, such as farming, food processing, transportation, packaging, wholesaling, retail and food service. As noted by the USDA, with each step in the process, the additional services, labor, transportation and infrastructure add value and increase costs to the final food product.

USDA’s Economic Research Service Food Dollar Series shows in 2024, farmers received 11.8 cents of every dollar spent on domestically produced food, the remaining 88.2 cents of the food dollar went toward the ‘marketing bill’, which includes costs associated with food processing, transportation, packaging, wholesaling, retailing and food service. Over time, this shift illustrates how an increasing share of food spending is driven by services and supply chain activities rather than farm production itself.

Groceries Leave the Most on The Table For Farmers

Farmers’ share of consumer food spending varies widely depending on the type of food purchased. For example, the farm share of the food-at-home dollar was 18.5 cents in 2024, up slightly from 18.4 cents in 2023. But even in this category it means only than one-fifth of what consumers spend on groceries goes back to farmers.

As you may expect, products with minimal processing, require less of the value to be retained in that part of the food system, and therefore return a larger share of the food dollar to producers.

“The highest commodity that gets the most of that food dollar is fresh eggs,” Parum notes. “That’s just because there’s limited labor to process that food.”

Examples include:

Fresh Eggs: 69.1 cents (+6% from 2023)
Beef: 52.2 cents (+4.8%)
Fresh Milk: 50.8 cents (+5.6%)
Pork: 23.7 cents (+7.2%)
Poultry (+3.1%)
Fish (+2.8%)
Tree nuts and peanuts (-1.7%)
Fresh fruits and vegetables (unchanged)
Bakery Products: 4.8 cents (-9.4%)
Soft Drinks/Bottled Water: 1.3 cents (-7.1%)

A $10.4 Trillion Engine: Agriculture Drives One-Fifth of the U.S. Economy

Wed, 01 Apr 2026 12:46:57 GMT

Did you know that close to one in every three jobs nationwide is tied to food and agriculture? The latest Feeding the Economy Report says food and agriculture support about 49 million jobs, which is about 30% of total U.S. employment. Although less than 2% are on the farm, when you add food manufacturing, wholesale and retail, that adds another 24 million jobs, or about 15% of the workforce.

Each year, the Feeding the Economy Report measures the downstream, off-the-farm economic impact of U.S. agriculture. Danny Munch, an economist with the American Farm Bureau Federation, says the report tracks three layers of impact.

“When you combine those layers, ag supports about $10.4 trillion in economic output, or about one-fifth of the entire U.S. economy,” Munch said on the Newsline podcast .

2025: $900-Billion Growth in U.S. Agricultural Industry

The U.S. agricultural industry grew by nearly $900 billion over the past year, according to this study led each year by the Corn Refiners Association and sponsored by three dozen agriculture and food organizations, including the National Pork Producers Council (NPPC).

The first layer is direct activity, which includes the base level of food and ag production that is traditionally measured. It also measures supply industries like transportation, finance, equipment manufacturing and inputs in the second layer. The third includes the ripple effects of those two stages on how wages are earned and spent throughout the rest of the system.

“So, all the benefits we were talking about – jobs, wages, tax revenue – they’re tied to where that production happens,” Munch says. “If production shifts overseas due to cost pressures, regulatory burdens or competitive challenges, that economic activity moves with it. So, it’s not just about the food supply, it’s about all these other jobs, tax revenue and economic commerce that supports industries across every corner of every state.”

The report includes a state-by-state breakdown of agriculture’s economic impact, showing total jobs, wages, output, taxes and exports. Key findings include:

Food and agriculture generated more than $3 trillion in wages for U.S. workers, with wages rising 4% year-over-year and 13% over the past decade.
Food manufacturing remains the largest manufacturing sector in the U.S., employing almost 2.3 million workers.
U.S. food and agriculture exports were more than $177 billion, though exports declined by $5.4 billion year-over-year, underscoring the need for maintaining strong trade agreements and expanding market access for American products.
The food and agriculture sector produced $1.35 trillion in tax revenue for federal, state and local governments, a 7% increase year-over-year.

“The report confirms the incredible, positive impacts of agriculture on our country,” says NPPC CEO Bryan Humphreys. “America’s 60,000-plus pork producers are proud to help drive this force that provides our food and other agriculture products—and the opportunity to be part of something bigger than themselves by carrying on a tradition of taking care of their families, neighbors, animals and land, and at heart, a way of living that often has been passed down for generations.”

U.S. pork producers annually generate more than $37 billion in personal income, contribute more than $62 billion in GDP, and support more than 573,000 jobs in the U.S. economy, NPPC adds.

White House Sets Record Biofuel Volumes for 2026 and 2027

Fri, 27 Mar 2026 18:27:37 GMT

In the 20th year of the Renewable Fuel Standard (RFS) program, the White House has established the renewable fuel volume requirements for 2026 and 2027 at the highest levels in program history. The Set 2 final rule, announced at the White House Great American Agriculture Celebration in front of 650 invited attendees, realigns the program with Congress’ intent to increase the use of homegrown American biofuels.

“Today’s announcement is truly historic for our nation’s farmers and energy producers. These numbers represent the highest levels of biofuels ever required to be blended into our fuel supply,” says Brooke Rollins, Secretary of Agriculture. “With President Trump and Administrator Zeldin’s leadership, these historically high volumes are expected to create a $3 to $4 billion increase in net farm income. The Renewable Fuel Standard Set 2 Rule will create a $31 billion dollar value for American corn and soybean oil for biofuel production in 2026, which is $2 billion more than in 2025. Our farmers are stepping up to grow American energy dominance.”

Just this week, EPA renewed emergency waivers for E15 gasoline sales during the summer driving season.

What Does the Set 2 Final Rule Mean for Farmers

To meet the 2026 and 2027 volume levels, EPA estimates biodiesel and renewable diesel production and use will need to increase by more than 60% versus 2025 volumes. The increase was above the initial proposal.

“The proposal that we saw nine months ago was extremely robust,” explained Kurt Kovarik of the Clean Fuels Alliance America. “In fact, our industry, along with the petroleum sector and the soybean growers, asked for a volume requirement for 2026 of 5.25 billion gallons. They proposed 5.61 billion gallons. And today’s proposal is right in that neighborhood between 5.5 to perhaps as high as 5.6 or 5.7. There’s a little bit of math yet that needs to be done.”

He said that in 2025, biodiesel and renewable diesel facilities were forced to shut down or run far below prior-year production levels due to market uncertainty. U.S. biodiesel production declined by one-third in 2025, compared to 2024.

“Biodiesel and renewable diesel represent 10% of the value of every bushel of U.S.-grown soybeans, contributing to President Trump’s desire for American energy dominance and domestic market demand for agriculture commodities,” said Kovarik. “American farmers and other feedstock providers are eager for the growing domestic clean fuel market to drive value in agriculture, along with economic growth and job creation in rural communities. American consumers are desperate for secure, affordable domestic energy. Today’s rule is a clear win for the nation’s energy security.”

With the benefits Set 2 will bring to America’s farmers, EPA estimates the rule will generate more than $10 billion for rural economies and create more than 100,000 new jobs in the agricultural and manufacturing sectors. To provide continued certainty for American corn growers and ethanol producers, EPA will maintain the 15 billion conventional biofuel level for 2026 and 2027.

Based on EPA’s latest release on March 27

(EPA)

What are Renewable Volume Obligations?

RVOs are targets set by EPA to determine how much renewable fuel must be blended into the U.S. transportation fuel supply. EPA determines the total volume of different categories of biofuels that should be used in the country for multi-year periods. Once decided, EPA converts the total volumes into percentage standards, which represent the ratio of renewable fuel to the total amount of gasoline and diesel expected to be consumed in the U.S. that year.

Each “obligated party,” typically refiners and importers of gasoline and diesel, calculates its RVO by multiplying EPA’s percentage standards by the total volume of non-renewable gasoline and diesel they produce or import. To prove they have met their RVO, obligated parties must use a serial number attached to each gallon of biofuel, known as Renewable Identification Numbers (RINs). When the biofuel is blended into the fuel supply, the RIN is “separated” from the physical fuel.

At the end of the compliance year, obligated parties must submit to EPA enough RINs to cover their specific RVO. If a refiner blends more biofuel than required, they can sell their excess RINs to other refiners who have not met their obligations.

Adjusted Small Refinery Exemptions

The EPA also finalized the reallocation of the volumes from Small Refinery Exemptions from 2023 through 2025. Those are now set at 70%.

“Adding it to the top line volume for 2026 and 2027, the volumes that were waived over those three years will be made up in 2026 and 2027,” Kovarik. “For our industry, that’s somewhere between an additional 200 to 250 million gallons a year.”

He says that is on top of the already robust minimum volume that EPA set. The agency claims the RFS rule will create $31 billion in value for American corn and soybean oil.

Renewable Fuels Association (RFA) President and CEO Geoff Cooper noted that while they advocated for full reallocation of the 2023-2025 SREs, the 70 percent reallocation included in today’s rule is better than other options that were under consideration. EPA had proposed 50 percent reallocation as an option and also solicited public feedback on no reallocation at all.

“We continue to believe small refinery exemptions are completely unjustified, and the SRE petition process—including EPA’s reliance on the Department of Energy’s ‘scoring matrix'—is fundamentally flawed,” Cooper said. “SREs distort the market, undermine fair competition, and destabilize the RFS program. And while RFA appreciates EPA’s efforts to minimize market disruptions by reallocating most of the renewable volume lost to SREs, we believe the Agency has a duty to fully restore all exempted volumes.”

RVO Reaction Pours In

The Renewable Fuels Association (RFA) and other farm groups applaud the RVO announcement from EPA.

“Today’s RFS rule supports continued growth in American-made renewable fuels like ethanol and brings much-needed certainty and stability to the marketplace,” said RFA on X.com .

Today’s RFS rule supports continued growth in American-made renewable fuels like #ethanol and brings much-needed certainty and stability to the marketplace. We are grateful to @POTUS and @epaleezeldin.https://t.co/FdovzBqLUr
— Renewable Fuels Association (@EthanolRFA) March 27, 2026

“Congress intended year-to-year renewable fuel blending to increase under the RFS and today’s announcement with the highest-ever volume obligations helps fulfill their intention,” said Brian Jennings, CEO for American Coalition for Ethanol. “We’ve consistently advocated for strong final blending obligations for 2026 and 2027, reflecting the full potential of the RFS and ensuring small refinery exemptions (SREs) do not erode demand for renewable fuels.”

Jennings says the integrity of the RFS depends on ensuring volume obligations translate into real-world demand. Any gap between required volumes and actual blending undermines the program and creates uncertainty for ethanol producers, farmers, and rural communities.

“We appreciate President Trump, Administrator Zeldin and Secretary Rollins for delivering strong RVO volumes and doing so in a way that recognizes the importance of American farmers,” said NSP Chair Amy France, a farmer from Scott City, Kan. “These volumes provide critical certainty for sorghum producers and help strengthen demand across the biofuels sector.”

NSP also highlighted EPA’s decision to reallocate 70 percent of previously exempted volumes, helping ensure that promised demand is realized.

“Maintaining the integrity of the Renewable Fuel Standard is essential,” France said. “Reallocating those gallons helps protect the market opportunities farmers depend on. We need to build on this momentum and get year-round E15 across the finish line.”

Ohio farmer and National Corn Growers Association President Jed Bower, who was present at the White House for the announcement, also weighed in on the latest volumes.

“Our deep thanks go to President Trump and Administrator Zeldin for releasing these robust RVO numbers in an exceptionally timely manner and, appropriately, during an event honoring America’s farmers. This action provides certainty to corn farmers across the country who rely on a stable biofuels industry. Today’s announcement, coupled with the Trump administration’s E15 summertime waiver earlier this week, is a positive move for the nation’s corn growers who are navigating an exceptionally difficult economic environment. There is still more to be done to help our growers, and we look forward to working side-by-side with the president and our allies in Congress to get permanent year-round E15 legislation over the finish line.”

Fuel and Fertilizer Costs Surge

While there’s hope that embracing biofuels can help bolster the farm economy and lower prices at the pump, farmers are feeling the fallout of higher oil prices. According to AAA on Friday, the national average for a gallon of diesel fuel was $5.38. That’s nearly $2 per gallon higher than it was just a year ago, and it’s happening right as farmers gear up for the spring planting season.

“To help lower gasoline prices for farmers and consumers, this week, I issued an emergency order to allow immediate sales of E-15 — and just as I promised in the campaign, I’m seeking Congressional action to allow E-15 all-year-round,” said President Trump.

Fertilizer prices are also significantly higher in the last few weeks. While some farmers pre-applied acres last fall and others bought earlier in 2026, there are still a number of acres left to cover.

Congress Eyes 'Skinny' Farm Bill and $15B in Ag Aid

Wed, 25 Mar 2026 18:07:37 GMT

The House and Senate Agriculture Committees are working on passing a “skinny” farm bill alongside $15 billion in farm aid.

On the Senate side, Agriculture Committee Ranking Member John Boozman says he expects work on the farm bill to begin within weeks, rather than months.

Skinny Farm Bill Moves Toward House Floor

The House version of the bill is gaining momentum after successfully passing out of the House Agriculture Committee.

Chairman G.T. Thompson says the bill will not be ready for a full House vote in time for the White House Celebration of Ag. However, he expects it to advance soon. Thompson told AgriTalk he is currently consulting with Democrats and various caucuses ahead of the vote.

“When I check the box on those, I think in the near future here,” Thompson says. “It’ll be after Easter obviously. At this point we’re going to be ready, we’re going to be ready to go. We’re going to be ready to take this to the House floor.”

Areas of Contention

Thompson expects a lively debate on the House floor regarding SNAP benefits and the Ag Labeling Uniformity Act. The latter dictates labeling rules for pesticides.

“There are some folks that think that we ought to have 50 different sets of instructions and 50 different processes to go through. It just drives up the cost of food and I also think it creates chaos to where we can put our farmers in harm’s way. I trust the EPA. I trust those scientists,” he explains.

Proposition 12 will also be a point of contention. Thompson notes the Supreme Court directed Congress to resolve issues tied to California’s sow production rules.

“That doesn’t step on states rights to do whatever a state wants to do. Doesn’t interfere with animal safety in different states. It just doesn’t allow one state to dictate to all the other states,” he adds.

High Odds of Passage

Thompson remains optimistic about the bill’s passage following a strong bipartisan committee vote. He also notes that support from President Trump should help the bill advance through the House.

The Senate may face a more difficult path, as 60 votes are required for passage.

$15 Billion in Farm Aid

Congress is also developing a supplemental funding bill that may include much-needed farm aid. Thompson says the assistance is critical for the industry.

“You know what we did a year and a half ago, I would have thought we wouldn’t have needed that. But the lingering impacts of inflation, the availability of inputs, the cost of inputs, you know, the disruption that’s caused by trade negotiations have made it a must,” he adds.

Thompson is working with Senate leadership on a $15 billion aid package.

“They’re looking at $10 billion for row crops, $5 billion for specialty crops. I actually have gone on record and said we need $10 billion for specialty crops and I need another $200 million for sawmills,” he explains.

The legislation could also include provisions for year-round E15 sales.

Farm Groups Call On Trump and Congress to Include Farmer Aid in Military Funding Package

Fri, 20 Mar 2026 18:56:43 GMT

As Congress considers a military funding package, relief for farmers might become a key component of the legislative equation. More than 50 farmer groups are asking President Trump and Congress to include aid in the package. The letter sites severe weather conditions, the effective closure of the Strait of Hormuz and sustained market pressure as their reasons for additional funding.

The farm groups also ask for strong Renewable Volume Obligations under the Renewable Fuel Standard, year-round E-15 and opportunities for farmers in the 45Z Clean Fuel Production Credit. Republican lawmakers are reportedly debating a plan to include $15 billion in relief for producers to mitigate impacts stemming from the conflict in Iran. The proposal, first reported by Politico, appears to be gaining traction in the federal government.

“We appreciate your longstanding commitment to rural America. Now is the time to ensure that American agriculture can weather this period of extraordinary strain. Without timely assistance, continued losses risk accelerating farm closures, reducing domestic production capacity and weakening the ability of farmers and ranchers across this great nation to provide food, clothes and fuel for the American people,” the letter said.

USDA Evaluating Implementation Strategies

Richard Fordyce, USDA Undersecretary for Farm Production and Conservation, says members of Congress reached out to the department about a month ago to seek technical advice on implementing additional assistance.

“We do hear some signals that there is a desire to offer some additional assistance,” Fordyce said on “AgriTalk” recently. “When I say technical assistance it would be Congress, either the Senate or the House, actually proactively reaching out to us and asking us questions about what would be the best way to implement this.”

For quick dispersal, Fordyce says USDA suggests Congress should model new payments after the Farmer Bridge Assistance Program.

“We’ve had those conversations. I don’t know where they are at this point, but I do hear signals that there’s still a desire to do something. I just don’t know what that number would look like,” he expains.

Economic Concerns Over Ad Hoc Assistance

While the potential for aid is welcomed by many in the industry, some agricultural leaders express caution regarding the long-term effects of ad hoc payments.

Matt Perdue, president of the North Dakota Farmers Union, says he supports additional aid because many farmers require the funds to survive the current year. However, he remains concerned about how payments influence the broader agricultural economy.

“I think long-term we have to look at the ways in which ad hoc assistance and the farm safety net are really fueling higher land prices, really fueling higher input costs,” Perdue says.

Perdue notes while farmers are currently battling immediate financial pressures that aid could alleviate, the industry must eventually address these underlying long-term challenges.

“Short-term, the problem is how do we make sure producers have the money they need to get through 2026. The long-term problem is how do we make sure we have a safety net that really reflects the reality that is 2026, 2027 and the years ahead?” Perdue says. “I think both of those are important questions, and we’re wrestling with both at the same time.”

Status of Farmer Bridge Assistance Program Payments

Fordyce says USDA has received close to 400,000 applications for the Farmer Bridge Assistance Program. Of that about an eighth were submitted electronically.

“We’re getting close to $9 billion obligated in that program out of a total of $11 billion,” he adds.

Deadline to apply for the Farmer Bridge Assistance Program: April 17.

USDA Ag Outlook: Farm Economy 'Making Progress' in 2026, But Headwinds Persist

Thu, 19 Feb 2026 22:03:50 GMT

For the first time in several years, the heavy cloud of skyrocketing production costs is beginning to lift, according to USDA chief economist Justin Benavidez. Speaking at USDA’s 102^nd annual Agricultural Outlook Forum on Thursday , Benavidez unveiled a 2026 forecast that suggests “progress is being made,” even as the row-crop sector navigates a significant transition in acreage and a shifting policy landscape.

After his outlook, Farm Journal had the chance to speak one-on-one with the new USDA chief economist. When asked his biggest takeaway from the outlook on the ag economy, he was positive about progress.

“I think the big story for this year is that progress is being made,” Benavidez says. “Obviously, we are not out of the woods in terms of cost of production, in terms of finding higher prices through new sources of demand, but we are making progress.”

USDA Ag Outlook Forum

(Lori Hayes)

Costs: Finally Turning a Modest Corner?

After multiple years of relentless increases, USDA now forecasts production expenses to moderate. Benavidez points to a key inflection point: inflation-adjusted costs.

“We’ll see cost of production moderate for the first time in several years,” he says. “When adjusted for inflation, total cost of production will decline marginally.”

That doesn’t mean every farmer will see lower costs in 2026.

“Certain producers are obviously going to see that nominal cost still go up marginally, in the neighborhood of 1% on average,” he adds.

Behind the recent volatility, Benavidez says, lies a longer-term structural issue.

“We are still working very hard to get out of what is really a 15-year discrepancy in that cost of production and price received for crops,” he says. “We’ve had some black swan events that have masked a long-term gap in cost of production and price received.”

Closing that gap will require more than cost control. Benavidez says it will require more sources of demand.

The Biggest Wild Cards

If there is one factor that could significantly alter the 2026 outlook, Benavidez says it is biofuels policy.

“I’m going to be watching closely to see what happens with the RFS debate as well as [the] 45Z rule,” he says.

The 45Z Clean Fuel Production Credit provides tax incentives to refiners, increasing derived demand for feedstocks such as corn, soybeans and potentially canola. USDA is working on flexible feedstock provisions that could further influence farm-level incentives.

“It provides a tax credit to refiners of those biofuels, and then that increases a derived demand for some of the biofuel input products, like corn, beans and canola,” he explains.

At the same time, negotiations around the Renewable Fuel Standard (RFS) and E15 could reshape demand expectations.

“That could really impact both the demand for corn and for beans, depending on where the RFS and that debate over E15 winds up going,” Benavidez says.

However, he notes the timing of these policies is critical, which is why he considers them the biggest wild cards he’s watching.

“If those changes and updates happen prior to planting, we could see a significant change in what the acreage forecast looks like, as well as what the price forecast looks like.”

The ripple effects could extend beyond Washington.

“We know that in some places where you might swap into planting soybeans, you’re more favorable toward cotton,” he says. “We might see that if one of the policies on the biofuels side goes into place that favors soybeans a little bit more, we might see a reduction in cotton acres — or the opposite could be the case for corn.”

The Numbers You Need to Know

USDA Ag Outlook Forum Acreage Projections

(Lori Hayes )

According to Pro Farmer, the highlights from USDA’s Grains and Oilseeds outlook released on Thursday include:

Corn yield is projected at 183 bu. per acre, producing a 15.8 billion bushel corn crop, down about 7% from 2025. USDA says the yield projection “assumes normal planting progress and summer growing season weather.”
Total corn supplies are forecast at 17.9 billion bushels, down from the record of 18.6 billion in 2025/26.
Total U.S. corn use for 2026-27 is forecast to decline about 2% on lower domestic use and exports.
Food, seed and industrial is flat at 7.0 billion bushels.
Corn used for ethanol is forecast at 5.6 billion bushels, based on expectations of essentially unchanged motor gasoline consumption and exports.
Feed and residual use is down about 3% to 6.0 billion bushels on lower supplies.
Exports are down 200 million bushels to 3.1 billion. “U.S. global trade share is expected to decline slightly on larger competitor exports from South America and modest global demand growth,” USDA says.
Ending stocks are projected at 1.8 billion bushels, down 290 million from a year ago and resulting in stocks relative to use at 11.4%, down from 2025-26 but higher than the most recent 5-year average of about 10.8%.
The season-average corn price received by producers is forecast up 10¢ to $4.20 per bushel.

USDA’s projected corn acreage for 2026 released during the 2026 Ag Outlook Forum.

(Lori Hayes )

Soybeans and Stronger Profit Potential?

USDA says the projected rise in soybean acres reflects “stronger profitability compared to other crops, along with expected crop rotations across the Corn Belt and the Delta.”

Assuming normal weather conditions, yields are expected to average 53.0 bu. per acre, leading to a 188-million-bushel increase to production to 4.45 billion bushels.
U.S. soybean crush is projected to rise by 85 million bushels, reaching 2.655 billion, supported by rising soybean meal and oil demand.
Given normal weather, oilseed meal supplies are expected to be ample in 2026-27, keeping soybean meal prices relatively flat with the prior marketing year at $300 per short ton.
U.S. soybean exports for 2026-27 are projected at 1.7 billion bushels, a recovery from the 2025-26 forecast of 1.58 billion bushels (or 42.9 million tons).
Exports for the 2025-26 marketing year are forecast to decline to the lowest level in 13 years. Accounting for a record-low share of just 23% of global soybean trade, USDA says tariff measures curtailed shipments to China, the largest export destination for the U.S., which imported an average 28.7 million metric tons of U.S. soybeans during the 2021-22 through 2023-24 marketing years. Argentina’s temporary elimination of export taxes last September also led to a counter-seasonal surge in exports in November, further impacting U.S. market share globally, USDA adds.
Soybean ending stocks for 2026-27 are projected at 355 million bushels, nearly flat with the 2025-26 forecast.
The season-average farm price is projected at $10.30 per bushel, marginally higher than the prior marketing year.

USDA’s projected soybean acreage for 2026 released during the 2026 Ag Outlook Forum.

(Lori Hayes)

Benavidez says USDA’s price forecast is for marginal improvements, but he notes headwinds are still in the forecast.

Acreage Shifts: Fewer Corn Acres, More Soybeans

One of the more closely watched projections from USDA is a 5 million acre decline in corn plantings and an increase in soybean acreage to 85 million. The corn reduction is roughly 1 million acres larger than some private trade forecasts.

“There’s always discrepancy in forecasts, right?” Benavidez says, noting the projections are early-season estimates.

He says it’s important to note USDA’s World Agricultural Outlook Board evaluates multiple variables when looking at acreage forecasts this early.

“They’re looking into factors, obviously the soy-to-corn price ratio, which is trending toward more bean acres relative to previous years,” he explains. “We’re getting close back to that 10-year average of the ratio between soy and corn price, which trends toward a little bit more bean acreage this year when compared to corn.”

USDA’s projected acreage for 2026 released during the 2026 Ag Outlook Forum.

(Lori Hayes)

Global and domestic stocks also play into the equation. Ultimately, he says it boils down to where producers think they will make the highest net return.

Total principal crop acres are forecast to decline about 1.5 million acres. However, shifts among crops could offset some of that.

“Our principal crops will see about a 1.5 million acre decline in terms of total acres planted,” Benavidez says. “But the mix of other acres is going to moderate some of that acreage decline a little bit.”

He pointed to cotton as one example, but he notes regional impacts are harder to pin down at this stage.

“It will vary across the country,” he says. “But regional specifics — I think this is very early to be talking about regional specifics.”

Cotton: Sustained Headwinds

Among the major crops, cotton faces some of the most persistent structural challenges.

“You know, we do look at the cotton complex as something that is facing sustained headwinds,” Benavidez says.

He acknowledges recent gains in net cash farm income for cotton producers, attributing part of that improvement to policy support. But globally, competition remains intense.

“There’s a lot of increased production in Brazil that is competing with our exports from the United States,” he says. “They have, in some cases, a lower cost of production than our producers here in the United States.”

Long-term consumption trends also weigh on the sector, as he notes the long-term trend toward more synthetic fiber and flat demand for cotton fibers is a headwind the cotton industry is going to face long term.

“The cotton complex is one that I certainly do think that I’ll pay a lot of attention to this year,” he says.

Trade: A Global Balance Sheet Approach

USDA’s outlook also includes China’s commitment to purchase 25 million metric tons of U.S. soybeans annually through 2028. But Benavidez emphasizes USDA does not model trade strategy; it models global supply and demand.

“As an economist, we don’t really focus on what the strategy is in terms of making those decisions,” he says.

Instead, the World Agricultural Outlook Board looks at total global demand and total global supply.

“If China or any other partner has demand for a certain amount of bean imports, that’s going to offset any readjustment in trade with other partners throughout the globe,” he explains. “We balance that with global supply and build a market picture based on those two factors.”

Attendees say some sessions during the 2026 Ag Outlook Forum were standing room only.

(Farm Journal )

Fewer Headwinds — But Not Clear Skies

The overarching theme of Benavidez’s 2026 outlook is cautious optimism.

“We are not out of the woods, but we are making progress,” he says.

With moderating costs, modest price gains and potential demand expansion through biofuels, the farm economy may finally be seeing some easing pressure. Yet structural imbalances, global competition and policy uncertainty remain central forces shaping the year ahead.

Cotton Acres Projected to Slide Again in 2026 as Economic Pressures Mount

Wed, 18 Feb 2026 21:02:53 GMT

The U.S. cotton industry is bracing for another year of contraction as a “perfect storm” of high production costs, sluggish global demand, and stiff competition from alternative crops pushes producers to rethink their acreage.

According to the National Cotton Council’s (NCC) 45th Annual Early Season Planting Intentions Survey , U.S. cotton producers intend to plant 9.0 million cotton acres this spring, a 3.2% decline from 2025. While a 3% dip might seem modest in isolation, it follows a massive 17% reduction in acreage last year, signaling a sustained and sobering period of tough economic times for the industry.

And considering cotton producers lost, on average, more than $300 per acre last year, another year of declining acreage comes as little surprise to those in the industry, as some fear if the economist situation doesn’t change for cotton, more producers could exit farming in 2026.

The Economic Squeeze: Why the Shift?

In a recent interview on AgriTalk with host Chip Flory, NCC President and CEO Dr. Gary Adams highlighted the mounting pressure on farm balance sheets.

“Times are tough,” Adams says. “Prices have been declining and costs of production have continued to stay at high levels. It really is starting to mount up on producers in terms of the balance sheet for their farming operations.”

The survey reflects a strategic shift across the Cotton Belt. With cotton prices struggling to compete with the current markets for corn and soybeans, many growers are opting for crops with lower overhead.

“In a lot of cases, they’re looking at soybeans as an alternative, in part because of its lower cost of production than what you see in cotton,” Adams notes. This “flight to safety” is a direct response to the high-risk, high-reward nature of cotton in an era of volatile input prices.

Farmers Are Walking Away From Cotton

For Charles Williams, a farmer in Crawfordsville, Ark., he’s seen what multiple years of losses can do to an industry. Cotton is a cornerstone crop in his area, with the infrastructure reliant upon that single crop. But growing cotton also comes with specialized, expensive equipment that’s become almost too costly to own, especially with today’s cotton prices.

“We’ll continue to plant some cotton, at least as much as we did last year,” he says. “Our production last year is half of what it historically is, so we’ll be 50% to 60%, maybe 65% of what we historically plant with cotton,” he says.

Because these farmers have cotton equipment to pay for, equipment that can only do one thing, which is pick cotton, walking away isn’t an easy choice. Williams also is an owner of a gin. So, he says he’s only planting enough cotton to justify the equipment and the gin, but not any more than that. Why? He simply can’t afford to.

Inside the Survey: A Coast-to-Coast Breakdown of 2026 Intentions

The NCC’s annual survey, a massive data-collection effort mailed to producers across the 17-state Cotton Belt in January, provides a granular look at how farmers are shifting their strategies. And when you break it down by region, it shows where the most severe economic pressures could be.

Mid-South: The Sharpest Decline

The Mid-South is bracing for the most dramatic shift, with total intentions down 20.6% to 1.2 million acres.

Arkansas & Missouri: These states are seeing the steepest cuts, with Arkansas down 30.3% and Missouri down 25.0%.
The Outlier: Louisiana stands against the trend, with growers expecting to plant 17.1% more cotton.

Southeast: A Broad Pullback

Respondents in the Southeast indicated a 4.9% decline in total acreage, falling to 1.6 million acres, with more of a shift toward corn and soybeans.

Georgia: Growers expect to reduce acreage by 3.6% to 805,000 acres—a historic low. This marks only the fourth time in 30 years that Georgia has dipped below the 1.1-million-acre threshold.
Significant Drops: Virginia leads the decline at 17.9%, followed by South Carolina (10.5%) and North Carolina (6.0%).

Southwest: A Patchwork of Growth

Bucking the national trend, Southwest growers intend to plant 1.6% more cotton.

Kansas & Oklahoma: Kansas is looking at a 9.6% increase at the expense of wheat and soybeans, while Oklahoma is charging ahead with a 15.7% increase.
Texas: The nation’s largest producer remains relatively flat with a 0.4% increase. However, internal shifts are happening: West Texas is reporting a slight uptick, while the Blacklands region intends to pivot toward sorghum.

The West: Upland Down, ELS Up

In the West, the story is a tale of two cottons. While Upland cotton acreage is expected to decline by 7.2%, with New Mexico seeing a sharp 17.6% drop. Extra Long Staple (ELS) cotton is seeing a resurgence.

Looking Ahead: A New Safety Net With Long-Term Gains vs. Short-Term Pain

Despite the projected acreage drop, Adams points to several reasons for long-term optimism rooted in the latest Farm Bill provisions. The industry is just beginning to see the “heavy lifting” done by recent legislative wins, though the timing of the relief remains a challenge for growers facing immediate bills.

Key improvements to the safety net, according to Adams, include:

Reference Price Hikes: A 14% increase in reference prices for seed cotton under Price Loss Coverage (PLC) and Agriculture Risk Coverage (ARC) programs.
Enhanced Insurance: Significant improvements to the Supplemental Coverage Option (SCO), including an increase in the premium subsidy to 80%.
Program Synergy: For the first time, growers can utilize these area-wide insurance products alongside PLC enrollment, providing a multi-layered defense against market drops.

“The combination of those two programs for 2026 and beyond will give growers better risk management, better price support, and a better safety net under them,” Adams explains.

However, there is a catch: the lag in payment distribution. Growers must navigate the 2026 planting season and its associated expenses before the support from the 2025 crop arrives this October.

Reclaiming the Market: “Plant, Not Plastic”

To combat the acreage slide and sagging prices, the NCC is aggressively pursuing new legislative and promotional avenues to bolster domestic and global demand.

The first is the “Buy American Cotton Act,” a proposal to offer tax credits to brands and retailers that document the use of U.S.-grown cotton.

“We purchase roughly 20 million bale equivalents of cotton textile products... but only about 4 million bales of that is actually U.S. cotton,” Adams says. The act aims to incentivize “dirt to shirt” production within the U.S., potentially reshoring a textile industry that has largely moved overseas.

The industry is also leaning into the sustainability movement with its “Plant, Not Plastic” campaign. This initiative targets the growing consumer concern over microplastics found in synthetic fibers like polyester.

“Cotton is a healthy alternative,” Adams says. He noted that the industry’s message is gaining traction at the highest levels, even reaching the Make America Healthy Again (MAHA) commission, which recently highlighted the need for more study on the health impacts of synthetic microfibers.

Looking Ahead: The Path to Recovery for Cotton

While the 2026 outlook remains cautious, the industry is betting on a combination of legislative support and consumer education to turn the tide. By focusing on “nearshoring” opportunities in the Western Hemisphere and emphasizing cotton’s natural advantages over synthetics, the NCC hopes to create a more resilient market for the years to come.

The goal is to build demand at hone while changing behavior of brands and retailers. If they start using U.S. cotton instead of polyester or cotton from another country, there is hope for the future of cotton demand.

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.

Tight Margins, Tough Choices: How Row Crop Farmers Can Weather Today’s Financial Squeeze

Tue, 10 Feb 2026 20:16:39 GMT

Row crop farmers across the U.S. are facing a financial environment that leaves little room for error. Rising production costs, persistently high interest rates and commodity prices that have failed to keep pace are combining to pressure margins at nearly every level of the operation.

From the ag lending perspective, Alan Hoskins, president and national sales director at American Farm Mortgage and Financial Services, says the current cycle is forcing producers to rethink not just their numbers, but how they approach decision-making altogether.

During the 2026 Top Producer Summit, Hoskins says both farmers and ag lenders need to remember there’s a clear differentiation between profit and cash flow. And he says when it comes to cash flow, that’s something farmers should be looking at on a monthly basis.

“There are definitely a fair number of challenges out there,” Hoskins says. “When you look at 2026, the numbers don’t have the appearance of being better than what we saw in 2025.”

Input Costs Lead the Pain

Among the many pressures facing producers, Hoskins says higher input costs remain the most immediate and widespread challenge.

“Over the past few months, the increase in input costs is a significant driver in what we’re seeing across agriculture,” he says. “Commodity prices being where they are certainly contributes to that as well.”

Hoskins notes that while producers are keenly aware of rising costs, marketing decisions can sometimes compound the problem. In volatile markets, hesitation to price grain can leave margins exposed.

“There are times where there’s a little bit of inertia on the part of producers to take advantage of sales opportunities when they present themselves,” he says. “There’s always the hope that the margin will improve, but that’s exactly where a written marketing plan becomes extremely valuable.”

A marketing plan, Hoskins says, helps remove emotion from pricing decisions and provides structure during uncertain times.

Where Farmers Still Have Levers to Pull

Despite the headwinds, Hoskins believes producers still have meaningful opportunities to manage costs — particularly by scrutinizing inputs more closely.

“Looking at fertility levels across different farms and making sure you’re applying the proper amounts of fertilizer is one place to start,” he says. “Every field doesn’t necessarily need the same approach.”

He also encourages producers to evaluate field operations carefully, weighing whether a tillage pass truly adds value compared to alternative chemical applications.

“These are the kinds of decisions that, taken individually, may not seem significant. But collectively, they can have a real impact on the bottom line,” Hoskins says.

Insurance is another area he believes deserves renewed attention.

“With the increases we’ve seen in equipment values and real estate values, it makes sense to revisit property and casualty insurance,” he says. “There may be opportunities to adjust coverage levels and capture some savings without increasing risk.”

Financial Stress Is Real, And It’s Growing

From a lender’s vantage point, Hoskins says the financial strain facing row-crop producers is increasingly visible. While not every farmer lost money in 2025, many operations ended the year with thinner working capital and less flexibility.

“Were there producers who made it through 2025 without losing money? Yes, but they were more the exception than the rule,” Hoskins says.

Looking ahead, he doesn’t expect conditions to ease quickly. That makes proactive planning and communication critical.

“When challenges exist, don’t try to solve them on your own,” Hoskins says. “Use the resources available to you: your lender, your accountant, your advisers.”

He cautions against reacting too aggressively in ways that could harm long-term viability.

“The goal is to weather this cycle,” he says. “It’s not to cut the meat completely off the bone and compromise your ability to operate when conditions do improve.”

Adjustment to Higher Interest Rates

Higher interest rates remain a sticking point for many producers, particularly those accustomed to historically low borrowing costs. Hoskins says perspective is important.

“While rates are much higher than what we’ve been used to over the last 25 years, if you look historically, they’re not that far out of line with the last 40 or 50 years,” he says.

The bigger challenge, he adds, may be mental rather than mathematical.

“We were in a very low-rate environment for a long time,” Hoskins says. “Adjusting to today’s rates requires a shift in expectations.”

To adapt, he advises producers to closely examine their borrowing structure across operating loans, equipment financing and real estate debt.

“If you’ve got debt that’s been out there for 12 or 18 months, there may be opportunities to restructure,” he says.

He also encourages producers to take advantage of low- or zero-percent financing options on inputs when available and to maintain open communication with lenders.

“Your interest rate is a product of your risk profile,” Hoskins says. “Having honest conversations with your lender helps you understand where you stand and what options you have.”

Are More Farmers Exiting?

With margins compressed and financing tighter, Hoskins says some producers are choosing to exit the business, but for different reasons.

“There are producers looking at 2026 and even 2027 and saying, ‘I don’t see things improving materially,’” he says. “They don’t want to see any more working capital erosion or equity erosion, so they’re making that decision on their own.”

At the same time, Hoskins acknowledges others may not have a choice.

“There will be producers who are unable to obtain the funding they need to go another year,” he says. “In those cases, the decision to step away isn’t voluntary.”

Still, he does not expect a widespread collapse.

“I wouldn’t characterize this as something that’s going to be across the board,” Hoskins says. “But with the challenges we’re facing, we will see examples of both.”

Mindset Matters As Much As Math

While financial statements tell part of the story, Hoskins believes mindset plays an equally important role in determining how producers navigate difficult cycles.

“The key truly has nothing to do with numbers,” he says. “It has everything to do with mindset.”

Hoskins encourages producers to define clear goals, not just for the coming year, but over a longer horizon.

“What are your one-year goals? Your three-year goals? Your five-year goals?” he asks. “Having that longer-term perspective changes how you view short-term challenges.”

He believes producers who approach decisions with a clear sense of priorities tend to make more measured, sustainable choices.

“When you understand your priorities as people first and foremost, you start looking at the financials differently,” Hoskins says. “That ultimately leads to better decisions.”

USDA Numbers Confirm the Reality

USDA issued its first net farm income forecast for 2026 just last week, but the bigger surprise was the fact the agency revised its net farm income forecast for 2025, showing sharper declines than earlier estimates. Hoskins says those revisions align with what they are seeing on the lending side.

“It doesn’t surprise me that USDA lowered 2025 farm income,” he says. “As more data becomes available, it gives a clearer picture of where reality really lies.”

While the outlook remains challenging, Hoskins stresses agriculture has endured difficult cycles before.

“We’re not going to lose all of America’s farmers and ranchers,” he says. “But we do have challenges within this industry that need to be addressed.”

For producers willing to plan ahead, stay disciplined and lean on trusted advisers, Hoskins believes there is still a path forward, even in one of the tightest margin environments in recent memory.

One Big Beautiful Bill Might Force Farmers to Rethink Farm Business Structures

Tue, 10 Feb 2026 15:02:08 GMT

At a time when farm income is under growing pressure, the One Big Beautiful Bill is reshaping the farm safety net in ways that go well beyond bigger checks or better crop insurance coverage. According to Farm CPA Paul Neiffer, the legislation could quietly push producers toward fundamental changes in how their farm businesses are structured, decisions that could have long-term implications for taxes, payments, and succession planning.

While the bill was signed into law in July of 2025, there’s still guidance that needs to be set before farmers can make vital decisions. And some of the most favorable changes- like to crop insurance coverage- won’t go into effect until late this year.

While much of the early conversation around the bill has focused on higher reference prices and stronger crop insurance subsidies, during the 2026 Top Producer Summit, Neiffer told attendees the real impact may not be fully understood yet, and farmers should be paying close attention.

“This bill changes the rules we’ve all been operating under for the last 20 years,” Neiffer says. “And when the rules change, the structure of the farm suddenly matters a lot more than it used to.”

Financial Stress Is Already Building in Farm Country

The bill arrives against a backdrop of tightening farm finances. USDA’s updated net farm income forecast showed a sharper-than-expected decline for 2025 , with early projections for 2026 offering little comfort, particularly for row-crop producers, a trend doesn’t surprise Neiffer.

“It peaked out in 2022, and it’s definitely been going down ever since,” he explains. “If you’re a row-crop farmer, 2026 is probably going to look a lot like 2025 unless something changes on the price side.”

While government payments will help stabilize income, Neiffer is blunt about what would happen without them.

“Without ARC, PLC, the FSA payments, the SDRP top-ups, without all of that, most row crop farmers would absolutely be struggling right now,” he says.

Payments tied to the One Big Beautiful Bill are expected to start flowing in October, providing a critical backstop during a period when margins remain thin and balance sheets are tightening across large parts of the country.

Crop Insurance: One of the Bill’s Biggest Wins

Neiffer gives the crop insurance provisions in the One Big Beautiful Bill high marks , calling them one of the clearest positives for producers.

“I’d give it a B-plus to A-minus,” says Neiffer.

Why such a high grade? The bill boosts premium subsidies across most revenue protection levels:

Coverage levels from 55% to 75% receive a 5 percentage-point increase in premium subsidies.
80% and 85% coverage levels see a 3 percentage-point increase.
Supplemental Coverage Option (SCO) now extends up to 90% coverage, and farmers can now pair ARC with SCO, something previously prohibited.
SCO subsidies jump from 65% to 80%, making higher coverage far more affordable.

For many producers, especially wheat growers, these changes significantly reduce out-of-pocket costs while expanding protection.

Beginning farmers also receive a major boost. Previously limited to a 10% premium subsidy bump for five years, the bill expands the benefit to 10 years, with even higher subsidies in the early years.

“For young farmers, it can now make financial sense to farm on their own instead of with their parents,” Neiffer said. “From a family standpoint, they’re actually going to make more money.”

Prevent Plant Still a Pain Point

Not everything is a win. One of the main reasons Neiffer doesn’t give the crop insurance changes a straight A is because of changes to prevent plant, something that remains a concern, especially in high-risk regions like Arkansas and the Dakotas.

Under previous rules, farmers could buy up an additional 10% of coverage. That was later reduced to 5%, and Neiffer says USDA’s Risk Management Agency is still discussing cutting or eliminating that option entirely.

“That extra 5% really matters when you’ve got too much water,” he said.

While not enough to outweigh the bill’s positives, the issue drags down what could otherwise be a near-perfect crop insurance package.

Beginning Farmers See Expanded Incentives

The bill also significantly expands benefits for beginning farmers, extending premium subsidy incentives from five years to ten , while also increasing the subsidy percentages in the early years.

“Before, they got a 10% bump, but only for five years,” Neiffer says. “Now it’s 15% in years one and two, 13% in year three, 11% in year four, and 10% all the way through year ten.”

That change, he says, could alter how farm families bring the next generation into the operation.

“For a lot of young farmers, it may actually make more sense financially to farm on their own instead of farming with their parents,” Neiffer says. “If they’re part of the parents’ operation, they may or may not qualify for those premium subsidies. On their own, they do.”

From a purely financial standpoint, Neiffer says some families could generate more income overall by restructuring how younger operators enter the business.

Prevent Plant Remains a Lingering Concern

Despite the positives, not every provision landed well with producers. Prevent plant coverage remains a contentious issue, particularly in regions prone to excess moisture.

“Under the old rules, you could buy up an extra 10% of prevent plant coverage,” Neiffer adds. “That got cut to 5%, and now RMA is still talking about cutting or eliminating that extra 5% altogether.”

For producers in places like Arkansas and the Dakotas, that reduction matters.

“When you’ve got too much water, that extra coverage helps mitigate a really bad situation,” he says. “Losing it would hurt.”

Even so, Neiffer says the overall crop insurance package remains strong.

“That’s really the only thing dragging it down just a little bit,” he said.

ARC and PLC Changes Offer Ongoing Protection

Beyond insurance, Neiffer points to ARC and PLC changes as one of the most important income stabilizers in the bill, especially because they are designed to work over time, not just in a single marketing year.

“The increase in reference prices and effective reference prices isn’t a one-shot deal,” he says. “It happens this year, it happens next year, and it keeps happening as long as prices stay depressed.”

The bill also includes what Neiffer describes as an “automatic put” built into ARC and PLC, designed to cushion farmers during prolonged periods of weak prices.

“That’s going to help smooth out income over multiple years, and right now, that’s exactly what farmers need,” says Neiffer.

The Structural Shift Farmers May Not Be Ready For

The most overlooked part of the One Big Beautiful Bill, and potentially what may be the most consequential part of the legislation, is how it changes payment limits tied to farm business structure.

Under old rules, LLCs and S corporations were often limited to a single payment cap. The new law shifts that framework, allowing multiple payment limits based on the number of equal owners , depending on how the operation is structured.

That opens the door to significant restructuring. According to Neiffer:

General partnerships may move to LLCs for liability protection and expanded payment eligibility.
C corporations, which remain stuck with a single payment limit, may convert to S corporations.
Some farms are already making the switch.

“I’ve talked to several farmers already that either have switched or will be switching,” Neiffer says. “And it’s completely because of the One Big Beautiful Bill.”

Still, he urges caution. USDA guidance on how these new rules will be applied has not yet been released.

“Before I tell anyone to change their structure, we need that guidance,” Neiffer says. “Otherwise, you risk unintended consequences that wipe out the benefit.”

A Note of Caution on Taxes and Spending

Neiffer also warns producers not to let tax provisions drive equipment purchases or expansion decisions.

“There are a lot of good tax provisions in this bill,” he said. “But farmers tend to get hooked on them.”

He points specifically to bonus depreciation as an area of concern.

“They go out and buy something just because they can deduct it,” he says. “If they finance it with debt, they don’t always think about what happens the next year, or the year after that, or the year after that.”

The result, he says, can be financial strain that lasts long after the tax benefit fades.

Guidance Still Needed Before Big Decisions

Despite the potential advantages of restructuring, Neiffer urges farmers to have patience. USDA guidance on how the new payment limit rules will be applied has not yet been released.

“Before I’m telling anybody to change their structure, we really need that guidance,” he says. “I worry about the law of unintended consequences, where we think the rule is going to work one way, and then something else kicks in and negates the benefit.”

Farmers were expecting clarity by the end of 2025. That hasn’t happened yet.

“We’re already almost to March,” Neiffer says. “But we should have it any day now.”

When it arrives, Neiffer believes it could prompt some of the most significant farm business decisions producers have faced in years , driven not just by markets, but by policy.

Trump Confirms Support for Year-Round E-15 Deal

Tue, 27 Jan 2026 23:17:51 GMT

President Donald Trump made a planned visit to Iowa — his first since July 2025 — on Tuesday, focusing on affordability, saying Iowa families are “winning” again under his leadership. Standing in front of a packed crowd in Clive, Iowa, with signs posted on the stage and scattered throughout the crowd that said “lower prices” and “bigger paychecks,” the visit unofficially kicked off the midterm elections where costs for consumers are expected to be one of the main political talking points.

While in Iowa, President Trump highlighted what the White House calls improving economic conditions for Iowa families, pointing to lower fuel prices, tax savings and agriculture-driven growth as signs the state is “winning again.” The President touted all the trade wins, including China buying soybeans and the EU agreeing to buy U.S. ethanol. He says by removing those trade barriers, exports are starting to flow to countries that had stopped buying U.S. ag goods before he took office.

But the reality is agriculture is at a crossroads, especially on the row crop side. Even with the recent trade deals, current economic pressures are creating a crisis in agriculture. Trump did briefly mention that crisis, blaming it on former President Joe Biden.

Trump Pushes Year-Round E15 During Iowa Visit

During his speech in Iowa, President Trump reaffirmed his campaign promise to support year-round E15, signaling a major win for corn growers and the ethanol industry.

“But I’m also working hard to expand your markets domestically,” Trump says. “In the campaign, I promised to support E15 all year round. I did. E15 all year round if I get elected, and I want to let you know, we’ll start right now.”

The statement sparked applause as Trump emphasized that efforts are underway in Congress to finalize approval, calling on House Speaker Mike Johnson and Senate Leader John Thune to deliver a deal that benefits farmers, consumers, and refiners, including small and mid-sized operations.

“I’m trusting Speaker Mike Johnson, who’s great, and Leader John Thune, who’s great, to find a deal that works. They’re very close to getting it done,” he says. “And I will sign it without delay.”

The president framed year-round E15 as a key part of his broader strategy to expand markets for U.S. corn, support rural communities, and strengthen domestic energy production.

🚨 BREAKING: President Trump announces Congress is actively working on a deal to allow E15 ALL YEAR ROUND that works for farmers, consumers, & refiners.

"Congress is working on a deal, and when they send it to my desk — I will sign it without delay."pic.twitter.com/TOpo3VUDI4
— The White House (@WhiteHouse) January 27, 2026

Trump Highlights “Historic Turnaround” for U.S. Manufacturing, Touts Deere’s Stock Hitting All-Time High

During his Iowa visit, President Trump touted what he called a historic one-year economic turnaround, pointing to manufacturing growth and new investments across the country.

“And America is respected all over the world like they’ve never been respected,” Trump says. “I thought it would take us two years. This has been the most dramatic one-year turnaround of any country in history in terms of the speed.”

Trump spotlighted John Deere as an example of American manufacturing success. He welcomed the company’s chairman at the event and praised the expansion of production facilities, including what he called two massive new plants.

“You’re opening one in North Carolina, one someplace else, and then you’re expanding all over the place. You’re doing a great job,” he says. “I bought a lot of John Deere stuff. Great country, great company, it’s an honor to have you here.”

The president attributed much of the growth to tariffs and economic policies aimed at attracting investment back to the U.S.

“It is because of tariffs and it is also because of the fact that we had such a tremendous November 5th. That November 5 brought spirit back to our country,” Trump says.

Trump then said that proof in the growth is in the stock market’s performance, including Deere stock hitting an all-time high of 529.51 on January 21, 2026.

But with strains in the farm economy, farm equipment sales saw a steep decline in 2025. Deere and Company, which has a large footprint in the Quad Cities and Des Moines, has laid off over 3,500 employees since October 2023. That downsizing, which the company says is driven by decreasing demand and lower sales, has hit the company’s manufacturing facilities hard, including locations in Waterloo and Ankeny.

John Deere Expands U.S. Manufacturing with Two New Facilities

President Trump highlighted John Deere’s plans to open two major U.S. facilities, marking a significant boost for American manufacturing and rural jobs. The president saying Deere’s decision was due to tariffs.

After the president’s remarks, the company sent out a press release, with John Deere announcing a major expansion with two new U.S. facilities coming soon to the U.S .

Dere says it will build:

A state-of-the-art distribution center near Hebron, Indiana, and a $70 million excavator factory in Kernersville, North Carolina, both set to open within the next year.
The North Carolina factory will bring excavator production back from Japan to the U.S., making John Deere the top domestic producer of excavators.

Together, Deere says the projects are expected to create hundreds of new American jobs, strengthen local economies, and advance John Deere’s commitment to $20 billion in U.S. manufacturing investments over the next decade.

John Deere executives emphasized the expansion as a continuation of their mission to “build America”, enhance innovation, and support the nation’s agriculture, construction, and manufacturing sectors.

The Strong Push for E15 to Help Turn The Ag Economy Around

As corn growers pressed for year-round E15 ahead of the president’s visit, ethanol advocates say the issue is no longer about executive action. It’s about Congress finishing the job.

Emily Skor, CEO of Growth Energy, says the Trump administration has already taken every step available to it through regulatory action.

Leading into Tuesday’s talk, biofuels leaders pushed for the president to focus on E15, saying rural America’s financial stress is colliding with a narrow policy window to get things like E15 done, and that could generate more demand, quickly changing the outlook for corn and soybean growers.

“What we hear from the team around the president is he did what he could,” Skor told Chip Flory during “AgriTalk” on Tuesday. “He issued an executive order. EPA gave us the summer waivers for last summer. We all know that what we need right now is an act of Congress.”

Skor says the White House wants lawmakers to deliver a bill that can be signed into law and end the seasonal E15 debate for good.

“The conversation has to be ‘Congress, do your job,’” she says. “The White House wants to see Congress get something done so they can bring a bill to his desk, so he can sign it and we can be done with this once and for all.”

That urgency is being echoed across agriculture, she says.

“I’ve got CEOs of all kinds of agriculture trade groups calling me saying: ‘What can we do to be helpful? We’ve got to get this done,’” Skor says. “All of agriculture is supportive of this.”

Iowa’s Reality: Corn Prices Below Cost of Production

Ahead of Trump’s second visit to Iowa in less than a year, corn growers and renewable fuels advocates used the moment to renew pressure for nationwide, year-round access to E15. Corn groups say the timing is critical, as lawmakers continue to stall on permanent E15 access despite strong Midwestern support. To make the push even more visible, Iowa Corn and the Iowa Renewable Fuels Association (IRFA) released an open letter on Tuesday , thanking the president for his past support of E15 and urging him to help push the policy across the finish line in Congress, while also running a full-page ad in Tuesday’s “Des Moines Register”.

ICGA and @iowafuel today released an open letter thanking @POTUS for his constant support of nationwide, year-round #E15 and asking for his help to finally push E15 access through Congress @realDonaldTrump pic.twitter.com/cxACXijKMN
— Iowa Corn (@iowa_corn) January 26, 2026

According to the letter, corn growers across the country, and especially in Iowa, are struggling as prices remain well below the cost of production. That pressure, they say, is rippling through the broader state economy.

The groups cite recent data from the Philadelphia Federal Reserve Bank, which ranked Iowa 50th among states for economic growth. They say expanding E15 is one of the fastest ways to reverse that trend.

“The best way to boost corn prices and create meaningful market demand is the immediate authorization of nationwide, year-round E15,” the letter states.

After Trump’s announcement on Tuesday, saying a deal is close, Iowa Corn Growers Association Vice President and farmer from Knoxville, Iowa, Steve Kuiper, expressed Iowa Corn’s appreciation, while highlighting what this could mean for farmers at a critical time.

“Iowa’s corn growers appreciate President Trump shining light on E15 and recognizing the weight this legislation holds to us as corn growers. Farmers are struggling with low commodity prices, high input costs and lack of markets. Passage of year-round E15 is the lifeline many of us need to be able to continue farming,” says Kuiper. “A recent study by Iowa Corn and the Iowa Renewable Fuels Association shared the positive effects year-round E15 would mean for corn growers. This is a goal we have been working towards for over a decade and getting this issue to the president’s desk and across the finish line is a win we all desperately need. The fact that the President sees this problem and promises a solution is coming is very encouraging and valued by us as farmers.”

Fun fact: today when @realDonaldTrump referenced supporting year-round E15 on the campaign trail, that started on January 19, 2016 at the Iowa Renewable Fuels Summit, where he was a speaker.

The next Summit is on February 5th and is FREE and open to the public. You might want to… https://t.co/g0G57UWrbF
— Iowa Renewable Fuels Association (@iowafuel) January 28, 2026

Leading up to today’s statements by Trump, both Iowa Corn and Iowa Renewable Fuels reminded the Trump administration that year-round E15 would immediately expand domestic demand for corn at a time when farmers are under intense financial pressure. Even with the latest round of financial aid through the Farmer Bridge Assistance Program payments, 92% of agricultural economists surveyed in Farm Journal’s December Ag Economists’ Monthly Monitor said the row crop side of agriculture is in a recession. More than 90% said that will accelerate consolidation in agriculture — something Iowa agriculture is seeing firsthand.

Biofuels Seen as Economic Pressure Point and Opportunity

Kurt Kovarik, vice president of federal affairs at Clean Fuels Alliance America, appeared on “AgriTalk” before Trump’s talk on Tuesday. He says the group sent a letter to the president earlier this week urging the administration to focus on two immediate policy opportunities.

“We’re excited to see him head to Iowa,” Kovarik says. “We were briefed that the purpose of the conversation was to highlight economic opportunity, perhaps domestic energy dominance.”

Kovarik says Clean Fuels asked the administration to spotlight progress on renewable fuels, particularly finalizing renewable volume obligations under the Renewable Fuel Standard and issuing long-awaited guidance on the 45Z clean fuel production tax credit.

“I’m sure you’ve had a lot of conversations around E15 — that’s in the hands of Congress,” he says. “So, what we want to do is highlight for the president the EPA’s efforts to finalize the renewable volume obligations under the RFS as an opportunity to provide market certainty and growth for our industry, as well as finalizing the 45Z clean fuel production tax credit guidance, which we do not yet have.”

That certainty, Kovarik says, has been missing, and the consequences have been felt across rural America.

“Our industry had a really, really tough 2025,” he says. “Following a really great ’24, ’25 was really poor, as it was along the farm economy.”

He says the downturn wasn’t driven by demand alone, but by uncertainty around federal policy.

“It was a lack of profit, lack of margin, which meant reduced capacity,” Kovarik says. “In fact, we’ve had a lot of plants idling.”

After producing more than 5 billion gallons of clean fuels domestically in 2024, Kovarik says output dropped sharply in 2025. Plants across the industry operated at just 60% to 70% of capacity.

“In some cases that may be a plant dialing back to 80%,” he says. “In a lot of cases, particularly the smaller plants, maybe in Iowa, those that don’t produce their own feedstock came offline entirely.”

But it’s not just corn at a crossroads. He says that slowdown directly affects farm demand, especially for soybean oil.

“If our industry got those two things in the near term, we would flip around this industry nearly immediately,” Kovarik says. “Turn these plants back on, buy more soybean oil, add value to the soybean farmer and get this fuel to the consumer.”

Kovarik points to renewable volume obligations as a key pressure point. Under the Biden administration’s final three-year RFS rule, biomass-based diesel volumes for 2025 were set at 3.35 billion gallons — well below what the industry was capable of producing.

“We produced over 5 billion gallons in 2024,” he says. “So, that’s part of the reason our industry had a tough year.”

Looking ahead, Clean Fuels, petroleum refiners and agriculture groups asked EPA to raise 2026 volumes to 5.25 billion gallons. EPA’s proposal came in even higher.

“EPA actually proposed an estimate around 5.6 billion gallons,” Kovarik says. “They were even above ours.”

If final numbers land near that range, Kovarik says it would send a powerful market signal.

“Our feeling is if it comes down anywhere in the neighborhood between what we asked and what EPA proposed, it’s going to be a very, very strong market signal,” he says.

Timing matters, too. Kovarik says EPA has indicated the rule could be finalized soon.

“Our expectation is EPA is committed to have it done within the first quarter of 2026 — that means the end of March,” he says. “Hopefully early- to mid-March.”

As corn growers push for year-round E15 and broader biofuels support during Trump’s Iowa visit, Kovarik says optimism is returning, even after a difficult year.

“Although most folks are really feeling bad about how ’25 was, they’re also very optimistic about 2026,” he says. “Because of what we feel we’re on the cusp of.”

Corn Growers Disgusted as Congress Leaves E15 Out of Government Spending Bills

Just last week, E15 and corn groups were dealt a blow. That’s because year-round E15 was left out of the latest spending package , something corn and renewable fuels groups had been pushing to get included in the latest bill.

When asked how year-round E15 failed to advance earlier this year, Skor points to political realities inside the House.

“Parochial politics,” Skor said on AgriTalk Tuesday. “It’s incredibly frustrating.”

Despite broad ag support and mounting corn supplies, Skor says narrow vote margins and competing interests stalled progress.

“We have been a chorus saying, ‘We want markets, not handouts. We want markets,’” she says. “Look at how much corn we’ve grown in the U.S. We need to find markets.”

Skor says House leadership ultimately pulled the issue from budget negotiations due to concerns over securing enough votes, particularly from members tied to small refinery interests.

“He knew that he could not get the votes he needed to pass the budget,” she says. “So he said, ‘We’re going to table this. We’re going to create a council. We’re going to deal with this separately.’ And that’s what happened.”

Looking ahead, Skor says attaching year-round E15 to a must-pass spending bill remains possible, but unlikely in the near term.

“I’m never going to say never,” she says. “But I think the realistic, immediate path for us is trusting our champions.”

She points to Rep. Randy Feenstra of Iowa as a key leader on biofuels policy.

“He’s fantastic on our issues,” Skor says. “He proved to be very, very strong in advocating for the Clean Fuel Production Tax Credit, 45Z.”

Skor says biofuels groups are now unified behind a legislative compromise that protects liquid fuels while expanding growth opportunities for American ethanol.

“We have the vast majority of liquid fuels united behind a legislative proposal,” she says. “We’ve done a really good job coming up with a compromise that has a future for liquid fuels and growth opportunities for American biofuels.”

As farmers look for demand-side solutions amid tight margins and large corn supplies, Skor says the message to Washington during Trump’s Iowa visit is straightforward: permanent E15 isn’t a wish list item. It’s a market fix agriculture needs now.

In the letter Iowa Corn and IRFA sent this week, both also pointed to Congress’ decision to sidestep E15 language in recent spending bills, instead creating a task force to study the issue. That task force, which is co-chaired by Feenstra, is scheduled to take action by February 28.

“Without permanent access to this market, the long-term viability of our state’s largest economic driver is at serious risk,” the groups wrote. “Today, we are asking for your help to finally push E15 access through Congress.”

It’s that same sentiment that was relayed in a statement from National Corn Growers Association (NCGA) president Jed Bower last week, who said corn growers “were disgusted, disappointed and disillusioned” after spending years of calling on Congress to pass E15.

“I met with Speaker Johnson back in November. He said he was frustrated because DOGE had pulled this out last year. He said he would get something done, and here we are again,” said the Ohio farmer. “The same thing we get all the time. Let’s step on and push on the farmers because there’s not very many of them and we can get away with it.”

Small Refiners Still a Roadblock to Year-Round E15

Even with support from major oil groups, Skor says a small group of refiners continues to wield outsized influence in Washington — enough to stall year-round E15 despite broad backing from agriculture and much of the energy sector.

“Well, enough that they could hamstring the speaker and they could hold up the votes on the budget,” Skor says, responding to questions about whether small refiners still carry weight in Congress.

Skor says the current proposal on the table represents a significant compromise, one she believes should be moving now.

“Let’s get year-round E15. Let’s reform the small refinery program so fewer refiners get it and we have more clarity,” she says. “We are supportive of that.”

She argues the small refinery exemption program has been abused, pointing to a growing number of legal challenges.

“There are over 15 lawsuits that have been filed in 2025 because of these small refiners. They’re greedy,” Skor says. “They’re whiny. They claim and allege hardship, and then they get on investor calls and talk about all the money they made in the quarter. You can’t have it both ways.”

Skor says the ethanol industry and its allies are now focused on exposing what she calls that hypocrisy while maintaining pressure on lawmakers.

“We have a very strong coalition now that should win the day,” she says.

Corn Growers Argue E15 Is a ‘No-Cost’ Solution

Iowa Corn and IRFA frame E15 as both an economic and regulatory fix, calling the current restrictions outdated and unnecessary.

“Removing the outdated regulatory hurdle for E15 is exactly the type of government efficiency you’ve worked for,” the groups wrote, urging Trump to continue applying pressure as Congress debates the issue over the coming weeks.

They also emphasize permanent E15 access would come at no cost to taxpayers, while strengthening American energy dominance and providing a critical lifeline to corn producers.

“Permanent nationwide access to E15 is a common-sense, no-cost solution,” the letter sent earlier this week concludes. “Now is the time.”

With the task force deadline looming and the president back in Iowa, corn growers hope the renewed push will translate into action and finally deliver year-round E15 access they’ve been seeking for more than a decade.

Trump Defends Tariffs, Says Farmers Will Be “Biggest Beneficiary”

Ahead of his Iowa talk, President Trump made an appearance at the Machine Shed restaurant in Urbandale, where he had an exclusive interview with Fox News. During that interview, Trump strongly defended his use of tariffs, calling them “indispensable” to economic growth and long-term benefits for farmers.

“Tariffs have been indispensable toward success,” Trump says. “We’ve taken in $600 billion in tariffs.”

Trump says some of that revenue has already been directed back to agriculture, including the Farmer Bridge program payments, which are scheduled to be in farmers’ bank accounts by the end of February.

“I gave the farmers $12 billion last week and took them out of tariff money,” he says.

When asked about concerns from Iowa farmers who worry tariffs could hurt exports and commodity prices, Trump says the benefits will take time to materialize.

“It’s going to take a little while to kick in,” he says. “But I think the farmers are going to be the biggest beneficiary.”

Trump points to protections against foreign crops being sold into the U.S. at below-market prices.

“When you used to have people coming in and dumping their crops into the United States, you guys were hurt,” he says. “They’re not allowed to do that because we’re tariffing those crops.”

He also draws parallels to his first-term trade battles, particularly with China.

“The farmers stuck with me the first time, and I was right,” Trump says. “We gave them $28 billion then. Now we gave them $12 billion, sort of a minimal payment.”

While acknowledging legal challenges could arise as the Trump administration awaits the Supreme Court’s ruling, Trump still signaled tariffs, or similar tools, will remain part of his strategy.

“If the Supreme Court strikes down the tariffs, we will find something — some other way of doing a similar thing,” he says. “But it’ll be more inconvenient.”

As Trump delivers his message in Iowa, tariffs remain a flashpoint for rural America, balancing promises of long-term protection with near-term uncertainty for farmers navigating tight margins and volatile markets.

At a Breaking Point, More Cotton Farmers Could Be Forced to Walk Away

Tue, 13 Jan 2026 17:59:58 GMT

It’s a grim reality that isn’t improving in the South. Cotton and rice producers say their balance sheets are bleeding red. After multiple years of losses, debt continues to mount, and recently announced government payments are not expected to come close to covering the financial hole farmers face again this year.

For many, the question is no longer how to make a profit, it’s whether they can stay in farming at all.

Farmers, industry leaders and economists warn the U.S. could be approaching a breaking point for cotton and rice production, with 2026 shaping up to be another year that pushes more growers out of the business. And with more farmers potentially walking away, the fear is the U.S. could be on the verge of losing those industries altogether.

“An Average Crop Doesn’t Pay the Bills”

For Charles Williams, a farmer in Crawfordsville, Ark., he’s seen what multiple years of losses can do to an industry.

“In terms of how the year ended up, it’s pretty average to mediocre,” Williams says. “But an average crop really doesn’t pay the bills, unfortunately.”

Looking back at 2025, Williams says he feels fortunate his operation was able to plant at all. Heavy flooding across the mid-South last spring forced many acres to go unplanted, compounding losses in a region heavily dependent on rice and cotton.

The flooding came at a time when acreage was already under pressure.

“I’m on the Arkansas Rice Research and Promotion Board, and I’ve seen some projections on acres,” Williams says. “In 2024, I think we had 1.4 million acres of rice here in the state. In 2025, USDA shows 1.25 million got planted. I’m kind of surprised by that number, but it’s probably some late-planted rice. We’re projecting under 900,000 acres. I think that’s the lowest acreage since 1983.”

Arkansas is the nation’s largest rice-producing state, growing roughly half of all U.S. rice. Cotton is the other cornerstone crop,but it comes with specialized, expensive equipment that leaves farmers with few alternatives.

Because these farmers have cotton equipment to pay for, equipment that can only do one thing, which is pick cotton, walking away isn’t an easy choice. Williams also is an owner of a gin.

“We’ll continue to plant some cotton, at least as much as we did last year,” he says. “Our production last year is half of what it historically is, so we’ll be 50% to 60%, maybe 65% of what we historically plant with cotton. Rice, I don’t know. There may not be a whole lot of rice grown, quite frankly.”

The Piece Not Many Are Saying Out Loud: “We’re on the Cusp of Offshoring Production”

Williams says many farmers are planting crops in 2026 knowing full well they won’t make money on them. That reality has him worried about the long-term future of U.S. production.

“I hate to think about the possibility of offshoring cotton production and rice production,” Williams says. “I think we’re on the cusp of that right now.”

That concern is echoed across the Cotton Belt.

When Gary Adams, president and CEO of the National Cotton Council, spoke to “U.S. Farm Report” last spring, he warned the industry had gone from just losing money to losing farms . Nearly a year later, he says little has changed.

“If you just look at the economics of where the market is, it’s been generally trading sideways over the last half of 2025,” Adams says. “For a lot of growers, the situation is kind of the same as it had been. You just put another year of losses on top of what had been a couple of years before that.”

Adams says conversations with farmers reveal a level of stress he hasn’t seen before. Average cotton losses in 2025 are estimated at more than $300 per acre.

“That’s the kind of numbers we’re seeing for the 2025 crop,” Adams says. “We compare that to 2024, even a little worse than what we saw in 2024, and 2023 had a loss as well, just not as large. That’s the magnitude we’re looking at when we stack up market returns versus cost of production.”

Government Aid Helps, But Doesn’t Close the Gap

Last week, USDA announced payment rates for the Farmer Bridge Assistance Program , with rice payments set at nearly $133 per acre and cotton payments just over $117 per acre.

Those payments drew criticism from soybean farmers who argue soybeans were hit harder by last year’s trade dispute with China.

Seth Meyer, who served as USDA chief economist for five years before taking a job with the University of Missouri to start 2026, was on the front lines of crafting the calculations for the Farmer Bridge Program payments. He says it’s key to understand the program is designed as economic aid, not trade mitigation.

“We started off this discussion about trade mitigation and simply tight margins and tough economic conditions to bridge us to ARC and PLC support,” says Seth Meyer, director of Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri and former USDA chief economist. “The safety net kicks in in October of this year. When folks look at some of the commodity payments, this is an economic impact. They were calculating these very similarly to ECAP, looking at shortfalls in cost of production, not trade impacts.”

Meyer says the administration was pursuing multiple strategies simultaneously while being strategic with how the program was rolled out.

“There’s been kind of two efforts,” he says. “One is putting a program out there so the Chinese can’t hold that trade impact over our head during negotiation. At the same time, we’re pursuing other trade opportunities. When we look at ongoing trade negotiations with China and the president’s supposed visit in the spring, there’s been some progress, even though the friction lasted longer than last time.”

But the Farmer Bridge payments are capped at $155,000 per individual, a limit Adams says will constrain many cotton operations.

“I do think it’s helping offset a portion of their shortfall,” Adams says. “It gives them a chance to stay in business, not a chance at a profit, a chance to stay in business, when you combine it with the higher reference prices in the One Big Beautiful Bill Act that will take effect later this year.”

He says in the OBBB, cotton’s seed cotton reference price increased about 14%, but those funds won’t arrive until October.

“There’s still a lot of weight between now and then,” Adams says. “Things can happen with the market. This serves as a bridge, but does it fill the entire hole they’re facing? No, it doesn’t.”

What it does provide, Adams says, is some reassurance to lenders.

“It gives lenders some assurance to go with them for another year,” he says. “That’s the situation a lot of growers are in.”

More Farmers Walking Away? Those Decisions Are Being Made Right Now

Even with the assistance that USDA says should hit bank accounts by the end of February, Adams says some farmers won’t make it, either by choice or because their lender won’t finance them for the upcoming year.

“Some growers will look at the markets, look at cost of production, look at what equity they still have and make the decision that that’s enough,” Adams says. “They’ll decide to get out of farming and do something else. We know those decisions are being made right now.”

When asked whether the industry expects an uptick in farmers exiting, particularly in the mid-South, Adams doesn’t hesitate.

“I think there’s a really good chance that will happen,” he says. “Whether it’s by choice or dictated by their lender, they’re taking a hard look at what equity they still have and whether they want to continue taking on that level of risk.”

Ag Lender Says Farmers Are Seeing the Most Financial Stress Since the 1980s

Greg Cole is president and CEO of AgHeritage Farm Credit Services, which serves roughly 6,700 members across 24 counties in Arkansas. Cole started in ag lending in 1984, and he told U.S. Farm Report last year that Arkansas farmers were staring at a loss on every crop they grow . He says it’s not an exact repeat of the 1980s, but it’s eerily similar.

“I can tell you this, this is the most stress I’ve seen since the ‘80s when you come to farm profitability, i.e. farmers losing money,” Cole says. “One positive we have now compared to the ‘80s is land values. Our land values are still positive, which gives some lendable equity —unlike in the 80s, when I started my career, when U.S. farmland prices plummeted in some areas up to 60%.”

With a drastic drop in commodity prices, but input prices still record or near-record high, Cole says farmers in Arkansas, specifically, have been eroding balance sheets for four straight years.

“We started seeing losses in ’22 when 40% of our producers lost money,” Cole says. “In ’23, about 50% lost money. And then last year, in ’24, 70% lost money, with the average loss of about $150 an acre. And that’s after they received about a $50 per acre ECAP payments. Today, we’re looking at where we stand now. We could have a similar level of losses in ‘25 that we had in ‘24. Even though in ’24, we had very strong yields. But now we have weaker yields.”

As mounting debt shows up on the balance sheets, Cole says there are two types of farmers seeing the most severe financial strain.

“The ones who rent most of the land, especially if they pay on the higher end of rent. And here in the Mississippi Delta, most farmers who have a lot of acres rent most of their ground,” Cole says. “And then young, beginning farmers who didn’t have the opportunity to build up a lot of equity. Those are the ones that have occurred these multiple year losses where their balance sheet debt has swollen to a level that’s hard to service a debt when you add the interest rate cost on top of it.”

What Will It Take to Turn Cotton Prices Around?

With prices still below breakeven again this year, Adams says the industry is focused on the demand side of the equation.

“Commodity markets are always cyclical,” he says. “There will be some unanticipated shock, but when we look forward. We’re really focused on demand; global cotton demand has been relatively stagnant for the last decade.”

Global consumption currently sits between 115 million and 118 million bales, down from highs of 123 million to 124 million bales. That’s why the industry is leaning into campaigns like Plant Not Plastic , highlighting cotton’s environmental and health benefits.

“We’re really focusing on cotton as a natural fiber and a healthy alternative to synthetics,” Adams says. “Microplastic microfiber pollution is in the environment, in our bodies and in our food. We want brands, retailers and consumers to be aware of that.”

Adams also points to untapped domestic demand. Of the roughly 40 million bales of fiber consumed in the U.S. retail market each year, only about 4 million bales, roughly 10%, are U.S. cotton.

Legislation known as the Buying American Cotton Act , introduced by Sen. Cindy Hyde-Smith, aims to change that by offering transferable tax credits for products made with U.S.-grown cotton.

“We hope in the next two to three weeks to have a companion bill introduced in the House,” Adams says. “This would provide tax incentives to brands and retailers that document the use of U.S. cotton. We believe that translates into additional demand and better prices for producers.”

Williams says domestic consumption is critical.

“I think we need to find ways to incentivize production as much as we can,” he says. “Beyond that, domestic consumption is something we need to be looking at. The Buying American Cotton Act is an America-first approach that could reshore finished goods. That’s what we need.”

“It’s Hang On and Hold On”

Until something changes, farmers say the pressure will continue into 2026. For Williams, the stakes are deeply personal.

“It’s hang on and hold on,” he says. “I’m going on 52 years old. I’ve got four kids, two in college and two in high school, and I need to see them through.”

For many cotton and rice farmers across the mid-South, the coming year could determine whether holding on is still possible.

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?

The Major Market Forces That Could Reset or Further Tighten Farm Margins in the New Year

Mon, 05 Jan 2026 16:48:08 GMT

As producers close the books on 2025, there’s little debate about how the year will be remembered. Commodity prices retreated from harvest highs, input costs refused to follow them lower and margins compressed from both sides. But for market analysts at StoneX Group, the real takeaway from 2025 isn’t the pain. It’s what the year reveals about where agriculture is headed next.

Looking ahead to 2026, Arlan Suderman, StoneX chief commodities economist, and Josh Linville, StoneX vice president of fertilizer, both say 2026 will be shaped by structural shifts that go far beyond one growing season. Global competitiveness, domestic demand growth, geopolitical risk and policy decisions are converging at the same time, and it’s how those forces resolve, or fail to do so, could determine whether 2026 brings opportunity, volatility or another year of pressure.

Suderman: “We’re Not the Lost Cost Producer in the World Anymore”

The downturn producers experienced in 2025 fits squarely into a longer-term cycle that began forming well before the year started, Suderman says.

“We’re entering the cycle, and supply becomes greater than demand, and prices go down, and we’re going to have lean times,” he says. “And that certainly happened [in 2025].”

That cycle, he says, exposed a deeper challenge facing U.S. agriculture, and one that won’t disappear just because markets eventually recover.

“We continue to lose market share to Brazil,” Suderman says. “The reality is we’re not the low-cost producer in the world anymore.”

That loss of cost advantage is having consequences that ripple across exports, acreage decisions and profitability.

“Brazil is going to be able to produce bulk commodities cheaper than us,” he says. “And with their cheap currencies, they’re going to be able to sell it cheaper than we.”

Suderman says that reality is forcing a shift in thinking for U.S. producers and policymakers.

“So we have to find other ways to generate revenue from what we do produce,” he says. “We’re great at producing it, but Brazil is going to be able to produce bulk commodities cheaper than us, and so we have to find other ways.”

Domestic Demand Becomes the Battleground

With export competition intensifying, Suderman says the next phase of market support must come from inside U.S. borders. That’s where biofuels, and specifically what EPA does with biomass-based diesel, will become central to the 2026 outlook.

“We have the biofuel program coming in, which we believe will transition to domestic demand to help replace the lost export demand,” he says.

Suderman points out that export demand to China is already structurally weaker, making domestic demand growth even more critical.

“We’re going to lose that export demand with China anyway,” he says. “So that EPA announcement looks to be good, but we’re still waiting. We’re still waiting for the final regulations from the EPA. We’ve been waiting for most of the past year.”

That delay, he says, isn’t just frustrating, Suderman says it has real economic consequences.

“If we get it by the end of the quarter, that means we’ve lost 25% of the production year,” he says. “If we get it very early in the year, then we can really ramp things up.”

Suderman also points out the details of the policy are just as important as the timing of the announcement.

“What will they do with the small refinery exemptions?” he asks. “Will they offset them all? Will they offset 50% of them? What will they do with the 50% credit for imported feedstocks that were originally proposed? Will that go up to 100%? Will it stay at 50%?”

StoneX expects compromise, but one that still boosts demand, which will be a critical market factor in 2026.

“Our bias is that we think they’re going to go closer to 100% on the feedstock but offset that by offsetting the SREs back onto the RVO,” he says.

If that happens, Suderman says soybeans stand to benefit first and most directly.

“We have tremendous crush potential for our soybeans,” he says. “If we drive soybean demand higher domestically, we can tighten up that balance sheet.”

That tightening, he says, changes the entire market dynamic.

“It leaves us vulnerable to a weather market,” Suderman says.

Corn Demand Is Strong, But Supply Still Dominates

Corn enters 2026 with a different set of fundamentals. Demand, Suderman says, is already robust, but production efficiency continues to cap rallies.

“Corn demand has been on fire,” he says. “We’ve become very good at producing it, and so that has been the problem there.”

One unexpected support has come from Brazil itself.

“Brazil has been ramping up corn ethanol production,” Suderman says. “That has made them less of a competitor in the export market than they otherwise would be.”

Even so, he expects the global balance sheet for corn to remain heavy, which could cap some of the excitement in the markets.

“Global corn demand has exceeded production for about the past decade,” he says. “But supplies were so large, we’re finally working them down to an area where it can start to matter.”

Suderman says that dynamic puts corn at a tipping point, but the market isn’t quite there just yet.

“It may be a year or two away,” he says. “But if we would have a weather problem this summer, we would suddenly find ourselves back in the situation where the market would have to respect that.”

Fertilizer: Where Do We Go From Here?

While producers look for demand-side relief, Linville says fertilizer markets remain one of the biggest headwinds going into 2026 with phosphate standing out above all others.

“You talk to any farmer out there who uses phosphate, and they’re going to tell you this thing is outrageously high priced,” Linville says. “If you look at it from a flat price comparison, it’s incredibly high. When you look at it versus grain values, they’re historically in decent shape, but phosphate values have gone so far above and beyond what we would consider normal.”

That disconnect has already altered behavior of the market, including some loss of demand this past fall

“You saw major demand destruction this fall,” Linville says. “There’s still a lot saying we’re going to see the same thing for spring.”

But the global backdrop limits how much leverage farmers actually have on prices, he says.

“As you look ahead to 2026, that output at export does not look like it’s going to improve,” Linville says. “We think it’s actually going to be markedly worse.”

And what’s the country that remains the linchpin in this discussion? He says that’s simple: It’s China.

“China is your typical leading exporter in the world. Eight to 10 million tons per year back in those normal years,” Linville says. “This year, we’ll be lucky if we get five million tons.”

Why Tight Supply Is Structural Not Strategic

Linville pushes back on the idea that global producers are intentionally tightening supply to inflate prices.

“They’re not restricting exports because they’re trying to drive the global price higher,” he says.

Instead, domestic priorities dominate.

“They’re trying to keep more supply in place for their own people,” Linville says. “There’s higher economic demand, growing industrial demand, battery manufacturing.”

The result is uneven pricing across regions.

“We have seen Chinese values be a decent discount versus the rest of the world,” he says. “It’s a little short-sighted from our standpoint, but when you’re the biggest exporter in the world, you get to do that.”

Nitrogen markets show some improvement, but remain vulnerable.

“You look at the Russian-Ukraine war — that’s a worry,” Linville says. “European production is still 75% of normal — that’s a worry.”

The deeper issue, he says, is how thin the global buffer has become.

“We just don’t have the excess production like we used to,” Linville says. “If there’s any impact to supply, the market reacts very quickly.”

Acreage and Logistics: Where Risk Still Builds

Looking to 2026, StoneX expects acreage shifts but not enough to materially ease fertilizer demand.

“I have corn down 3.5 million acres,” Suderman says. “Soybeans up 4 million acres.”

Much of that movement, he says, happens outside the Corn Belt.

“When you look at the South and the Plains, that can be up to 25% variance,” Suderman says. “That’s where you get your real shift.”

Even with fewer corn acres, Linville says fertilizer demand remains massive, which will support fertilizer prices.

“If we are truly going to be seeing something in the mid-90-million-acre corn range,” he says, “that’s a tremendous amount of fertilizer.”

His biggest concern isn’t price, it’s the timing.

“My worry is that when we all say: ‘Yes, we need that product for spring,’ everybody’s going to rush to market at the same time,” Linville says. “Logistics will penalize us severely.”

He says with that possibility in 2026, retailers are already adjusting to it.

“They can only take so much risk,” Linville says. “So they can only buy so much without further information.”

His advice heading into 2026 centers on communication not prediction.

“Keep having those conversations with your supplier, your retailer, your co-op,” Linville says. “I’m not saying go out and buy it, but have these conversations so the market can plan and be ready for spring.”

Farmers Face Budget Squeeze And Balance Sheet Challenges—Echoes Of A Decade Ago

Tue, 30 Dec 2025 21:12:38 GMT

If heading into 2026 feels a little like déjà vu, you’re picking up the same vibes Chris Barron, president and CEO of Iowa-based Ag View Solutions, is experiencing. He believes the next couple of years will echo the last big downturn farmers weathered a decade ago.

“It’s kind of scary that 2025, ’26 and ’27 look essentially like a repeat of 2015, ’16 and ’17,” Barron says. “If you remember that time frame and made it through, buckle down because I think we’re going there again.”

He says one of the clearest signals farmers are about to experience a repeat of a decade ago is based on the 2026 cost-of-production data from Ag View Solutions’ clients, who are based in 23 U.S. states and three Canadian provinces:

Soybeans: About $11.87 per bushel based on a 65-bu. average yield
Corn: About $4.69 per bushel (before basis) on a 223-bu. average, with many growers needing at least $4.85.

Some growers raising non-GMO seed beans or getting premium contracts can still make soybeans compete. But for many farms, soybeans are the weak link in the current economic cycle.

Right now, Ag View Solutions clients are expected to plant roughly 62% of their acres to corn and 38% to soybeans for 2026 — essentially the same as 2025. Barron says he doesn’t expect many acres to shift away from this mix to more soybeans “unless something really changes.”

Given current price relationships and crop insurance guarantees, Ag View Solutions data shows about a $50-per-acre advantage to corn over soybeans for the year ahead. Even if the dollars trend lower, he says corn often pencils out better because of gross revenue and risk management tools.

More Cost Pressures Heading Into 2026

It’s no secret production costs are increasing heading into the next season. Some of the key factors include:

Overhead costs (what Barron calls ‘”return to management”) for family and employee expenses, including phones, fuel and business-paid personal expenses, are up nearly 5%. After the past year or two of what Barron describes as hard belt-tightening, he says deferred spending is “snapping back” at higher levels.

Land rents are holding mostly steady, supported by higher property taxes and outside investor demand.

Interest expense is climbing as operating lines grow.

Fertilizer costs are a mixed bag. On corn, fertilizer costs are up about 7%, even though Barron believes most farms are staying with removal-rate applications. On soybeans, he says fertility costs will be lower, mainly because growers are putting less fertilizer on their bean acres and leaning harder on corn nutrients.

Machinery and equipment costs are also inching higher for the year ahead.

This Is Not A Repeat Of The 1980s

Despite the “red” many farmers will see on their spreadsheets in the year ahead, Barron says the current period is not a repeat of the 1980s farm crisis, for two key reasons:

Farmer equity is strong. Debt-to-asset ratios remain healthy for many U.S. growers, even if cash is tight.
Many farmer exits are voluntary. Today, many farmers are choosing to retire or scale back in order to protect equity.

Barron offers a recent example: “I got a call the other day on 7,000 acres, a 45-year-old farmer saying, ‘I’m not going to do this anymore. I’ve got a $5 million equity position, and I’m not going to go for a couple more years and chew away another million dollars. I’m just going to be done.’”

Strategies for the Current Climate

To survive — and potentially thrive — in this “repeat” cycle, Barron suggests focusing on these four areas in the year ahead:

Do the high-dollar work. Barron says the “$500-an-hour” work is crunching numbers in the farm office. “Know your true costs, stress-test budgets, analyze each profit center. A few hours spent with good numbers can be worth far more than another round in the tractor,” he says.
Protect yield. He advises against cutting seed, chemistry or other inputs that protect or enhance yield “just to save a few cents per bushel.”
Right-size your operation. Barron says some of the most successful turnarounds he’s seen with operations lately have come when farmers “right-sizes” — they’re doing less, but doing it better — instead of trying to be everything to everyone.
Use collaborative models. Barron says he is seeing more farmers share equipment and labor with their neighbors to spread fixed costs without extra capital.

Opportunity Will Still Knock

During a Top Producer podcast, Barron told Host Paul Neiffer that the tight times ahead will create new land-rent opportunities for some farmers who want to expand. What commonly happens when margins get tight is some farmers pull back, and that’s when expansion possibilities open up for others.

“We’ve had numerous clients call us about opportunities to rent land and not like in small amounts. When times are tight and when things aren’t good, that’s when these opportunities present themselves,” he says.

Barron’s message for those farmers in expansion mode: have your numbers, working capital and lender relationships in order now, so if the right block of ground comes available, you can move quickly and confidently on it.

If you’re interested in the ROI spreadsheet Barron’s team uses to analyze market trends, email cbarron@agviewsolutions.com .

Hear the complete discussion between Barron and Flory on Farm Journal TV . Also, you can listen to the Top Producer podcast discussion between Barron and Neiffer at the link below:

Southern Farmers Face ‘Brutal’ Losses as Rice and Cotton Lead Commodity Collapse

Tue, 23 Dec 2025 16:49:56 GMT

Arkansas farmer Nathan Reed says the financial pressure facing farmers in the South this year is unlike anything he has seen in his career — and it is hitting rice and cotton producers especially hard.

After several years of elevated input costs combined with an extended stretch of weak commodity prices, Reed says many Southern operations are now reaching a breaking point. While farmers across the country are feeling margin pressure, he says producers in the Delta face a uniquely severe financial squeeze that leaves little room for error.

“We are in a very difficult situation in the South, in Arkansas,” Reed says. “I grow five crops: cotton, corn, soybeans and rice, with wheat and milo every once in a while. My corn and soybeans don’t pencil out, but the losses are nowhere near what the rice and cotton losses are. It is just brutal, the losses that we’re sustaining.”

Reed says the scale of the losses is hard to overstate, particularly for rice and cotton.

“Rice and cotton right now are by far the biggest losers in commodities,” he says. “It’s just staggering losses per acre.”

Southern Farms Face Unique Financial Exposure

Reed says the financial stress facing Southern farmers goes beyond commodity prices alone. Structural differences in how farms operate in the region create a very different risk profile than what many Midwest producers face.

“Being in the South, we farm improved land, and we’re mostly irrigated,” Reed explains. “Compared to the Midwest, I would say we [have] farm larger operations, but we’ve been forced toward that just to maintain the same standard of living.”

That expansion, he says, has not necessarily improved profitability — and in many cases, it has increased exposure.

“We’ve been forced to expand quite a bit, but we don’t have as workable of an insurance program,” Reed says. “Because we’re always going to make 80% of a crop through irrigation and land improvements, we can’t really rely on insurance. We’re always going to make the crop.”

That reality, Reed says, leaves Southern producers vulnerable when prices collapse.

“We can have some pretty severe losses without any real way to recoup those losses,” he says. “That’s the risk we live with.”

Rice and Cotton Losses Deepen

USDA was expected to roll out the exact Farmer Bridge Program payment rates this week, but the agency says that will now happen before the end of next week with payments expected to roll out early next year. Ahead of USDA’s official release, early estimates point to cotton and rice seeing the biggest payment rates , and that’s understandably so considering cotton and rice are experiencing the steepest losses this year.

As price pressure intensifies, Reed says earlier loss projections are quickly becoming outdated, particularly for rice.

According to University of Arkansas projections released earlier this fall, losses were estimated at roughly $85 per acre for soybeans, nearly $353 per acre for cotton and about $259 per acre for rice.

Reed says rice losses are now significantly worse.

“The rice price is over 50¢ less than when that projection was made,” he says. “Rice losses are closer to over $300 an acre now, and yes, that’s very close to reality.”

He says those figures already include equipment payments, land rent and operating expenses — and that makes the situation even more precarious for producers carrying heavier debt loads.

“They take every number into account, equipment payments, land, rent, all of that,” Reed says. “If you’ve got a heavy debt load on equipment, rent and land at 20% to 25% market share, that’s absolutely the kind of loss you’re looking at.”

Watch the full “Unscripted” episode here:

‘You Can’t Just Walk Away From Cotton’

Despite those losses, Reed says cotton isn’t a crop farmers can simply abandon. Years of investment and infrastructure lock producers into the crop, even during downturns.

“The problem with cotton is you kind of have everything else we farm, and then you have cotton,” Reed says. “It takes a lot of specialized equipment. I’ve got three cotton pickers. I don’t have enough combine capacity to harvest all my land if I walked away from cotton.”

Beyond the equipment, Reed says entire regional systems depend on cotton production.

“You’ve got gins, warehouses, seed crushing facilities — this whole infrastructure that’s built just for cotton,” he says. “If you’re not careful, you can lose that in two to three years.”

Reed says most cotton farmers understand what’s at stake.

“I think most cotton farmers recognize that and are willing to try to stay in the cotton business as long as we can,” he says. “I’ve severely curtailed my acres, not because I wanted to, but out of economic necessity. I had to cut back to a level I can afford to lose.”

Global Competition and a ‘Non-Level Playing Field’

Reed says the financial strain is compounded by what he sees as unfair global competition. While U.S. farmers operate under strict regulations and higher costs, competitors abroad do not face the same constraints.

“I used to feel like the American farmer could compete against anybody in the world,” Reed says. “Now, I feel like we can produce the highest-quality crops under the best environmental and worker safety standards, but we are having difficulty competing on price.”

He points to cotton as a clear example.

“When you have South America making money on cotton in the low 60¢ range and the American cotton farmer hemorrhaging money, something’s not right,” Reed says. “How do you rebalance that? I don’t know.”

Higher labor costs and equipment expenses only widen the gap, he adds.

“I pay more for my labor per hour than most of our competition pays per day,” Reed says. “They’re buying the same tractors we are, but for 20% less because they don’t have to deal with emissions systems and the problems that go with them.”

Financing Pressure Builds Heading Into 2026

As producers look ahead to 2026, Reed says decision-making has shifted from profitability to survival.

“Right now, what we’re really looking at is what we can lose the least on,” he says. “That’s what my decision-making is.”

Even with expected USDA bridge payments, Reed says financing pressure is mounting and many producers may not make it through another year.

“Oh absolutely, there will be farmers who can’t get financed,” Reed says. “It’s been quiet because people were waiting to see what would happen. But my banker is getting calls every day from people trying to refinance or who’ve been cut off.”

He says once temporary relief measures are accounted for, the true impact will surface.

“I think that’s when the pain really comes,” Reed says.

The Stakes for Rural America

Reed says the consequences of sustained losses extend far beyond individual farms, especially in rural Southern communities where agriculture is the primary economic driver.

“In our little community, it’s just ag,” he says. “We don’t have factories. The whole middle class works for ag-related businesses.”

If farming isn’t viable, Reed says the ripple effects are devastating.

“If agriculture is not sustainable, I can’t stay,” he says. “And it drains out the tax base, the schools, everything. If ag is not viable, we might as well shut the door on every small town across the South.”

Reed says American farmers have upheld their end of the bargain.

“The American farmer has done their job,” he says. “We’ve provided the cheapest food per capita anywhere else in the world.”

But without change, he warns, the system will continue to erode.

“Twenty years ago, you could farm 2,000 acres, raise a family and be solidly middle class,” Reed says. “Now you’ve got to farm five times that just to maintain the same lifestyle. That tells you how bad this has gotten.”

Dollars And Dirt: Navigating The Financial Reality Of Conservation Farming

Fri, 19 Dec 2025 20:47:18 GMT

Farmers like Ted Hamer and April Hemmes aren’t opposed to conservation practices or regenerative agriculture—both Iowa row crop growers already use some. What they are opposed to is taking on unmanageable risk in an environment of tight margins, volatile markets and rising input costs without clear, reliable benefits.

During their recent, wide-ranging conversation on AgriTalk, a central theme emerged: if policymakers and companies seek broader adoption of conservation and regenerative practices, they must pair expectations with practical, well-designed incentives.

Here are some of the key points the two farmers made during their discussion with Host Davis Michaelson.

‘Regenerative’ is Just Good Farming
When new programs are announced with big dollar figures and bold language, they often imply that farmers need to be “fixed.” That doesn’t sit well with farmers, many of whom have been stewarding the same land for generations.

As Hemmes, based in Franklin County, Iowa, puts it, many practices highlighted under the umbrella of “regenerative agriculture” are simply standards for good farming.

“What you’re saying is regenerative ag, I just call farming. That’s just what we do. Taking care of our ground and having healthy soils is what we farmers do because it’s our legacy to our family,” says Hemmes, who uses no-till, cover crops and water management practices.

In her and Hamer’s perspective, farmers are not resistant to regenerative practices. Instead, they dislike being told they are “farming wrong” by groups and individuals outside of agriculture who may not fully grasp the on-the-ground economic and agronomic realities.

Tight Margins Make Experimenting A High-Stakes Decision
Hamer, based in Tama County, Iowa, explains that adopting new practices—such as cover crops, reduced tillage, or diversified rotations—often means incurring upfront costs, significant management changes, and a lot of uncertainty.

“It’s terribly risky with the margins we have right now… I’ve got to make a buck… I can’t have it be so risky that I don’t see a return on my investment,” Hamer says.

This is the crux of the matter: even when farmers are supportive and willing to adopt new practices and technologies, the math has to work, and some profit must be realized.

Their collective perspective is clear: without robust ROI data, strong cost-share or incentive payments, and integrated risk-management tools (like multi-year contracts or crop insurance integration), shifting current practices is often unjustifiable.

“The margins are too tight to stick your neck out very far at this time,” Hamer says.

Incentives Must Include Technical Support
National agricultural announcements often tout the dollar amounts available, such as the recently announced $700 million Regenerative Pilot Program . While funding is crucial, Hemmes points to an equally pressing need: technical support in the field to help implement the programs effectively.

“They need more dollars for people in the field…. I’ve been a soil and water commissioner for over 30 years, and we are in desperate need for technicians out here. So, throwing money at this is one thing, but getting the people in place to carry out the programs is another,” she says.

When USDA service centers, Extension offices, and others at the local level are understaffed and technical assistance is stretched thin, good programs can stall at the farm gate. Hemmes outlines the requirements for effective incentives:

Adequate Technical Assistance: To help farmers correctly design and implement complex practices.
Reasonable Timelines: Recognizing that some benefits, like improved soil structure and organic matter, take time to develop and build.
Simple, Predictable Processes: Application and compliance should be straightforward.

Without the necessary technical support and manpower, Hemmes notes that even the best programs often just turn into frustrating paperwork exercises.

Aid Payments Don’t Fix Structural Issues
Short-term “bridge” or aid payments can help keep farms afloat during difficult years, but Hemmes and Hamer say they don’t structurally support the long-term decisions that can improve grower practices and profitability.

The main issue, they contend, is that much of the money from these aid programs never truly stays on the farm.

“This payment (the $12 billion Farmer Bridge Assistance program) isn’t for us. It’s all going to input costs, fertilizer, equipment. None of that money stays in our hands,” Hamer says.

Hemmes agrees, noting that people outside of agriculture often “don’t see what the problem is” because farmers are seemingly getting “free” money.

“It’s not like we go to Amazon and order a bunch more crap off there because we got some money,” she says. “No. It goes to everything we have to do to put the next crop in the ground.”

Ultimately, she believes, major policy change requires facing difficult truths.

“We’d love free and fair trade, but we know that’s not a possibility,” she contends. “It’s going to hurt to make a change, and I think that’s what politicians don’t like. They want to get reelected, so [their attitude is] ‘let’s just keep doing it this way.’ That’s the tough part of it all, because anything that revolves around changing policy is messy.”

Hear the complete conversation between Hamer, Hemmes and Michaelson on AgriTalk:

Ag Bank Earnings Rise Alongside Loan Demand

Fri, 19 Dec 2025 12:58:16 GMT

Alongside strong growth in farm loans, liquidity at commercial agricultural banks tightened and earnings increased during the third quarter, the Kansas City Federal Reserve Bank reported Wednesday.

Citing the Reports of Condition and Income, the Kansas City Fed said the average loan-to-deposit ratio at agricultural banks increased to the highest level since 2019 and rose comparably more at lenders with the highest concentration of farm loans. Liquidity declined alongside consistently strong growth in non-real estate farm debt, which also supported an increase in average net interest margins and return on assets. Demand for farm loans has grown steadily alongside softening in farm financial conditions and farm loan delinquency rates increased slightly from a year ago but remained relatively low, the report said.
farmloan1218.png (1084x862, AR: 1.26)The regional Fed bank said the outlook for the U.S. farm economy remained subdued alongside weakness in the crop sector, but that strength in the cattle sector has lifted conditions in some regions and recently announced government assistance would provide support to farm incomes. Disparities in the crop and cattle sectors have been evident in credit conditions but despite profitability challenges for crop producers, aggregate farm financial stress has remained limited, the report said.

Ad hoc government payments associated with the American Relief Act and resilient farm real estate values have eased some strain in the sector throughout 2025. Looking ahead, market conditions in the crop sector are likely to keep profit opportunities narrow, but the recently announced Farmer Bridge Assistance Program will provide some relief to crop farmers in the coming months, the report said. Read more from Pro Farmer.

No More Idle Fields: How A Small Fish Could Solve Rice Farmers' Winter Revenue Gap

Wed, 17 Dec 2025 15:25:04 GMT

Researchers are pioneering a system in Arkansas to turn winter-idle rice fields there into productive fish farms, potentially offering environmental benefits and a new revenue stream for growers.

Currently, rice is planted in the spring and harvested in the fall, leaving the fields empty in winter. But what if this non-productive period could be utilized to add a second, lucrative crop?

The ‘Fish In The Fields’ Project
University of Arkansas researcher Ben Runkle is exploring that question with his multiyear research project called, “Fish in the Fields.”

Runkle says the research is being conducted on a commercial rice farm in eastern Arkansas in Lonoke County, about 45 minutes east of Little Rock.

“The concept was introduced to us by partners from California, at the Resource Renewal Institute, who are interested in exploring different types of regenerative production that are environmentally-friendly and farmer-friendly,” Runkle says.

Scientists at the Institute reached out to Runkle and his group, knowing their expertise in agriculture and farm practices and the interactions between the carbon and water cycle.

“We started designing this experiment to explore the potential for growing fish as a crop, concurrent, or in the off season, with rice,” Runkle says.
The researchers are evaluating two key potential benefits:

environmental/agronomic: The fish can help consume and degrade some of the leftover residues of the rice plant. They are also theorized to reduce methane emissions from the field in the winter period, Runkle notes. Additionally, they process and cycle nutrients, which could potentially reduce fertilizer needs for the subsequent rice crop.
economic: The fish provide an alternate source of income for the farmers if they are harvested and sold on the market.

Runkle says there are a couple of similar projects he’s aware of that are underway in the U.S. One is in Louisiana, where rice farmers are doing some rotation with crawfish in their fields. There are also some similar projects underway in California, with researchers and farmers there exploring the use of fish in the wintertime to help break down residues.

Small Fish, Big Impact
Runkle says the Arkansas project is currently focused on growing fish commonly referred to as darters.

“They’re very small fish, basically like minnows. They are most commonly used as feed for other fish,” he explains.

The 2024 winter marked the third time Runkle and his research team have raised the fish in the field. In the process, they developed a prototype system to turn the fish into a marketable product.

“They are being flash freeze-dried, packaged, and will be sold as fish food,” Runkle says.

Along with developing a marketable product, Runkle says his team’s work has demonstrated some regenerative agriculture benefits.

“My graduate student’s research has found very low methane emissions in these fields, which is an environmental benefit,” Runkle says. “We also have some evidence of the fish consuming the leftover residue in the field, which provides an agronomic benefit.”

Along with those efforts, Runkle and hist team are taking water samples to assess zooplankton and phytoplankton, and flying a drone over the field to measure chlorophyll content. “It’s a highly integrated, real-world measurement system,” he says.

De-Risking The System For Farmers
Future phases of the research will continue to look at how farmers could benefit financially from including fish as a second crop in their fields during winter while incurring a low level of risk. Being able to produce an additional “crop” on fields could provide a financial boost to rice growers in Arkansas, the No. 1 rice-producing state in the country, and potentially, for rice growers in other states.

Runkle says his group is evaluating how to “de-risk the system” by making sure it demonstrates a clear profit, does not impact farmers’ main crop of rice and offers a reliable market for the uniquely grown fish.

“We would like to study more about the methane dynamics, the fish productivity, and critical harvest methods. A major factor is improving the harvest, which currently involves draining the fields just right to congregate the fish in a ditch, and then using a special pump system to collect them. It requires year-by-year iteration to improve,” Runkle notes.

Runkle says financial support by the Southern SARE Grant (Sustainable Agricultural Research and Education) and an NRCS Conservation Innovation Grant is funding the research.

To learn more about the fish-in-fields project, listen to the recent podcast, Short Talks From The Hill , where host Hardin Young and Runkle discuss the research and the potential opportunities for farmers.

Why Corn Prices Aren’t Responding to Record Export Demand

Tue, 16 Dec 2025 19:42:29 GMT

From record-setting corn exports to unresolved trade negotiations and a new round of federal support payments , grain markets are sending mixed signals as producers begin to think beyond the current marketing year. While headlines point to strong demand and government assistance, underlying supply dynamics and policy uncertainty continue to weigh heavily on market confidence.

WASDE Offers Encouragement, But Supply Still Looms Large

The December WASDE report is typically considered a low-impact release, but this year’s update, released last week, caught the market’s attention with another sizable increase in corn export projections. That adjustment immediately invited comparisons to last year, when a similar move marked the beginning of a multi-month rally.

“We’re watching the price reaction off that WASDE because the similarities to last year are pretty incredible,” says Garrett Toay, principal with AgTraderTalk. “Last December, we had a 150-million-bushel increase in exports — the largest on record. We have 125 million this week. This week last year is when the rally in corn started and lasted through February.”

Despite that demand-side improvement, Toay says the broader supply picture remains difficult to ignore. Ending stocks are still large by historical standards, and upcoming USDA adjustments could reshuffle the balance sheet without meaningfully tightening supplies.

“We still have a fairly large carryout,” Toay says. “If we do get a yield reduction in January when they come in with final production numbers, I still feel there’s enough corn out there to keep the carryout relatively burdensome.”

U.S. ending stocks projections released in the December WASDE report.

(Lori Hayes/USDA Data )

He also notes that much of the demand strength is already embedded in USDA assumptions, leaving limited room for additional bullish surprises.

“We have a 600-million-bushel year-over-year increase in feed residuals,” Toay explains. “There’s a lot of demand that’s kind of baked into these S&Ds that could possibly be whittled away if they do cut supply.”

Record Exports Highlight Demand, But Prices Still Lag

Even as exports surge, corn futures have struggled to reflect that strength, raising questions about where the disconnect lies. For corn growers, the issue isn’t whether demand exists, but whether it’s translating into meaningful price support.

“We’re talking about record corn exports — 3.2 billion bushels — and we’re about 70% above where we were a year ago,” says Krista Swanson, chief economist for the National Corn Growers Association. “We’re off to a great start, but while this is a record in terms of volume, it’s not a record in terms of value.”

That distinction matters, she says, particularly in an environment of high input costs and tight margins.

“One of the problems is how does that value get back to the farmer?” Swanson says.

Looking ahead, acreage decisions will play a major role in determining whether supply growth continues to overwhelm demand gains. Swanson points to the soybean-to-corn price ratio as an early indicator of producer behavior.

“The soybean-to-corn price ratio is coming in really close to 2.5,” she says. “Above that favors soybeans, below that favors corn.”

After a historically large corn acreage year, some pullback appears likely — but even modest reductions would still leave the U.S. with substantial production capacity.

“Coming off such a high corn acreage year, we’re likely to see acres come down a little bit,” Swanson says. “But even if we came down to 95 million acres, that’s still a high corn acre year.”

That reality brings the focus back to demand expansion, both domestically and abroad.

“So, where does the demand come from?” she says. “We’ve seen good progress in trade agreements. Southeast Asia — Vietnam, Thailand — those markets have good potential. Diversified exports are one of corn’s strengths.”

Policy also remains central to that discussion, particularly ethanol blending.

“We are pushing for E15 to get done before Jan. 30,” Swanson says. “That’s the next funding deadline when Congress either has to act or go into shutdown.”

China Trade Uncertainty Weighs On Soybeans

Trade disruptions are a major reason those payments exist in the first place, and nowhere is that uncertainty more apparent than in ongoing negotiations with China. Conflicting messages around timing, volume commitments and enforcement have kept markets on edge.

“It feels like there’s a lost-in-translation aspect of these negotiations,” Toay says. “The White House wants China to buy a lot of soybeans. China wants to end the trade war and appease the White House, but we still don’t have a trade deal signed.”

While China has made purchases, Toay says they don’t reflect a return-to-normal commercial trade flows.

“The purchases we’ve seen have largely been from Cofco and Sinograin,” he says. “Those are government entities, and the beans are going into state reserves.”

Toay says while government entities might be buying, private crushers remain cautious about the current status of trade relations between the two countries.

“I don’t think you see private crushers in China buying U.S. soybeans until we have a trade deal,” Toay says. “There’s just too much risk.”

But he points out that uncertainty has also influenced speculative positioning.

“The funds started getting long when it looked like we were going to have a deal,” he says. “Now, with uncertainty about timing, they’re paring that back. If we get everything signed, sealed and delivered, the funds will know we’re good to go.”

Could Corn Enter The China Conversation?

While soybeans, sorghum and cotton dominate trade discussions, corn could still play a role if negotiations advance.

“I definitely think there’s a possibility,” Swanson says. “China is a big corn producer, but they’re also a big importer.”

She notes questions surrounding China’s domestic supply estimates.

“I’ve heard some rumblings that their corn production maybe wasn’t as big as the numbers indicate,” Swanson says. “If we have a deal, anything’s on the table, even though we haven’t seen that yet.”

Federal Payments Factor Into 2025 Outlook

Beyond market fundamentals, government support is shaping income projections for the coming year. USDA’s recently announced farmer bridge payments are designed to offset trade disruptions and weak prices, and early estimates suggest they could be meaningful for row-crop producers.

“We’re coming in with an estimate of about $45 for corn and $25 for soybeans,” says Gary Schnitkey, agricultural economist with the University of Illinois. “The corn payment is a little higher than the ECAP payment, and the soybean payment is a little lower.”

Schnitkey’s estimates are based on calculations by Nick Paulson of University of Illinois. He estimates the USDA per acre bridge payment will be:

Corn: $46
Soybeans: $25
Wheat: $39
Cotton: $115
Oats: $92
Rice: $134
Peanuts: $64
Sorghum: $48
Barley: $21

While final rules have not yet been released, Schnitkey says the estimates are broadly consistent with other analyses across the industry. When you combine that with anticipated ARC and PLC payments, the amount of government payments that will go on this year’s balance sheets will be significant, but still makes margins tight.

“As we’re looking at incomes for 2025, we’re looking at almost $100 of federal payments [for corn and soybeans],” Schnitkey says. “That gives us a positive income projection for 2025.”

However, those payments largely arrive after expenses have already been incurred.

“That’s also putting about $100 of receivables on the balance sheet,” he says. “These payments are significant, but we will have cash flow issues for a while.”

Will Congressional Inaction Force Farmers to Choose Between Health Insurance and Their Farm Budget?

Mon, 15 Dec 2025 23:11:13 GMT

Healthcare insurance plans for some U.S. farmers could double in 2026, as enhanced federal subsidies under the Affordable Care Act (ACA) are scheduled to expire.

The impending cost surge could affect thousands of U.S. farmers who currently rely on the ACA marketplace for their health insurance, according to the non-partisan KFF (formerly Kaiser Family Foundation), a health policy organization.

KFF estimated in 2023 that 27% of “farmers, ranchers, and other agriculture managers” relied on individual ACA market coverage. Nationally, more than 22 million Americans rely on the ACA marketplace for insurance options.

Farmers ‘Don’t Have Many Options’
Iowa farmer Aaron Lehman, who testified before Congress last week, highlighted the severity of the potential cost increase on his family. He said he expects to pay double to purchase an insurance plan for 2026 that would be comparable to what his family had this year.

“That is an incredible cost for our family budget and for our farm budget,” Lehman stated. The fifth-generation farmer and president of the Iowa Farmers Union described how rising healthcare costs are colliding with already harsh economic realities in agriculture.

“Farmers right now are trying to make all sorts of decisions because commodity prices are low, because of the chaotic trade situation that we’re in and higher input prices. All these things have made a real crisis for a lot of our farmers,” said Lehman.

“Finding ways to deal with that, we just don’t have too many options. Farmers will buy less equipment or not make the necessary upgrades and equipment that they need to,” he added. “They’ll look at their input suppliers, and they’ll decide, ‘what can we do to get through just this year … to get a plan to put the crop in the ground?’”

Read the testimony of Aaron Lehman here. A portion of his testimony and discussion is also featured on a posting to YouTube .

Signup Deadlines For Coverage
The challenge for farmers trying to decide on what insurance policy to purchase is compounded by the deadline to enroll in ACA marketplace plans: People needed to choose their ACA plan by Monday for coverage to begin Jan. 1. Open enrollment continues in most states until Jan. 15 for coverage beginning Feb. 1.

Despite broad public support for an extension to the ACA tax credits — a KFF poll said 74% of Americans favor continuing the enhanced credits — a congressional standoff has so far failed to produce a solution:

Failed Votes: Both a Democratic plan to extend the enhanced tax credits for three years and a Republican proposal to replace them with Health Savings Accounts (HSAs) failed to pass the Senate last week.
Impending Crisis: Nearly six in 10 enrollees (across all categories) told KFF they could not afford even a $300 annual increase in 2026 without significantly disrupting household finances.
Political Fallout: The issue of healthcare costs and expiring subsidies is highly polarizing, with some Republicans warning that a failure to address the problem could cost them legislative majorities in next year’s mid-term elections.

As the deadline for open enrollment closes and the Dec. 31 subsidy expiration date approaches, farmers must prepare for substantially higher health insurance costs in 2026 unless Congress acts to reach a last-minute agreement.

Young Farmers Need Better Options
During his testimony and ensuing discussion, Lehman stressed that healthcare isn’t just a personal household issue; it’s central to the future of American farming. With the average age of an Iowa farmer at 57, he said the sector desperately needs young and beginning farmers to return to the land. But without affordable, reliable health coverage, inviting the next generation back onto the farm becomes a far riskier proposition.

“You have to be very smart to figure out the plan that can bring the next generation on the farm,” he said, adding that many talented, innovative young people want to farm, but face daunting financial barriers — healthcare high among them. He noted that one of his sons works with him on their family operation, which is based in Polk County, Iowa.

Lehman framed affordable healthcare for farm families as an investment, not a handout: a way to make it possible for young farmers to feed their communities, support local and regional food systems, or continue larger family commodity operations.

“Extending the federal support for lowering the cost of health insurance is a true win for farmers and for all of rural America,” he said.

As Corn Farmers Face Tight Margins, One Policy Solution Gains Urgency

Mon, 15 Dec 2025 19:18:41 GMT

Harvest 2025 has wrapped up on Drew DeSutter’s Knox County, Ill., farm, but the work is far from finished. Attention has shifted from yield maps to balance sheets. Like many farmers across the Midwest, DeSutter is now focused on marketing grain in an environment defined by volatile prices, stubbornly high input costs and uncertainty about what comes next.

That unknown is shaping decisions not only for the current crop year, but also for planting intentions in 2026 — at a time when farmers are closely watching Washington policy moves and global markets.

DeSutter says yield variability, particularly in corn, was a key harvest theme in 2025. While overall production was solid, uneven results across fields complicate profitability calculations and marketing strategies. However, many farmers saw record soybean yields, which might have tilted the balance sheets in favor of soybeans.

“I think the jury’s still out, and we’ll see what prices do from this point on,” he says. “But I think if you look at your input prices and the price of corn this fall, versus the price of beans, maybe beans were a little bit more profitable, but it’s just a tight margin environment in both corn [and] soybeans right now.”

White House Announces $12 Billion in One-Time Farm Relief

As farmers work through those margin calculations, a major announcement from the White House is shaping the broader conversation about farm income and risk management. On Dec. 8, President Donald Trump unveiled what the administration describes as one-time bridge payment relief to help farmers facing trade disruptions and rising production costs. The per-acre payment rates are expected to be announced the week of Dec. 22.

Many farmers acknowledge the relief payments could provide short-term stability when disbursed early next year, but others question whether the assistance addresses the deeper structural issues facing agriculture, including high fertilizer prices, rising interest rates and trade uncertainty.

“It definitely feels like that it’s the new norm,” DeSutter says about the current tight margin environment. “Agriculture is cyclical. When I got out of college it was pretty good, then you go through some years that are a little tougher and we seem to always bounce back.”

Still, he says the current downturn feels longer and more persistent than previous cycles.

“Heading into 2026, I think it’s going to be another tight year from a profitability standpoint,” he adds.

Corn Growers Focus on Domestic Demand

For corn farmers, the conversation increasingly centers on demand and how to create new outlets for a crop facing heavy supplies. Corn exports are currently at record levels, according to the latest USDA report, yet prices don’t reflect that monumental demand.

That concern is echoed by national corn grower leaders, who say price pressure is intensifying at the same time production costs remain elevated.

“There’s been a lot of talk lately about soybeans, but corn prices have been down about 10% since the beginning of 2025. It’s a pretty significant drop, especially when you consider how high input prices are,” says Lesly Weber McNitt, vice president of public policy for the National Corn Growers Association (NCGA).

With USDA projecting more than 2 billion bushels of corn carryover, Weber McNitt says farmers are increasingly focused on how that grain will move.

“Export demand has been great, but that value isn’t there,” she says. “Even though our export volumes are record-setting this year, values are down about $1 billion year over year.”

That reality has sharpened NCGA’s focus on boosting domestic demand, particularly through expanded ethanol use.

Year-Round E15 Could Be What The Market is Searching For

One policy solution gaining renewed attention is year-round nationwide E15, which would allow gasoline blended with 15% ethanol to be sold throughout the year. The issue surfaces repeatedly during conversations with farmers and policymakers, including during the White House roundtable last week as the president rolled out the farmer bridge payments.

“Ethanol, you’re working for ethanol trying to get E15 year-round. I think we can have a lot of domestic product used here in the country, and we can keep America first, and you’re good at that, that is who you are,” said Iowa farmer Cordt Holub to the president.

“So E15 is a big deal?” Trump asked.

“E15 is a great deal year-round. Farmers would love you more than anything if we could continue to use domestic product, use the byproducts,” Holub added during the roundtable discussion.

Weber McNitt says it’s no secret E15 offers multiple benefits, extending beyond farm income alone, which is why it aligns strongly with the Trump administration’s agenda.

“It helps farmers. It helps achieve American energy dominance,” she says. “It helps tackle affordability because year-round E15 could help consumers pay about 25¢ less a gallon at the pump.”

Despite bipartisan support, Weber McNitt stresses that action ultimately rests with Congress.

Legislative Hurdles Remain

NCGA supports the Nationwide Consumer and Fuel Retailer Choice Act, which would permanently allow year-round E15 sales. While the bill has backing in both chambers, Weber McNitt says progress has stalled.

“Individual bills aren’t really moving, and there isn’t a lot of time left on the legislative calendar,” she says. “We need to find other bills that are likely to pass so that we can hitch a ride on them.”

Asked whether E15 could still be finalized in 2025, Weber McNitt says she remains cautiously optimistic.

“I would like to achieve it in 2025 still,” she says. “My hope is that we can get the E15 bill passed by the end of January.”

Geoff Cooper, president and CEO of the Renewable Fuels Association, shares that optimism.

“We think there are still decent odds we can get it passed here in 2025,” Cooper says. “This period between now and early 2026 is really our best shot at getting this legislation done.”

What E15 Could Mean for Corn Demand

According to NCGA data, growth in corn use for ethanol has largely stagnated since 2011. Weber McNitt says removing regulatory barriers to E15 could dramatically change that trajectory.

“For every 1% you raise the national fuel blending rate, you’d grind an additional 470 million or 490 million bushels of corn,” she says. “Once you scale up to that full 15%, we could be looking at additional demand of 2.4 billion bushels, which is just about what USDA is estimating we’ll have left over.”

She says demand growth would happen over time but the potential impact is significant for a sector searching for new outlets.

Looking Ahead to 2026

Back in Knox County, DeSutter says early signs suggest corn acres could remain strong again next year. Favorable harvest conditions allowed for extensive fall fieldwork, which could influence planting decisions.

Despite the financial pressure, DeSutter’s optimism remains intact. He says at some point agriculture will get back to profitability. Until then, he says incremental policy wins could make a meaningful difference.

“If you can get some small victories, whether it’s year-round E15 or less regulations, every dollar per acre helps when you’re in a tight margin environment,” he says.

‘Farmers Can’t Outyield the Balance Sheet Anymore’

Fri, 12 Dec 2025 22:39:11 GMT

Randy Dowdy, high-yield corn and soybean farmer and agronomic consultant, paints a stark picture of the economic pressure bearing down on American farmers.

Fresh from a visit with customers, Dowdy says the same three questions dominate almost every discussion he had with growers:

Where can we cut costs?
Where do we have to spend money to stay in business?
How do we service existing debt when margins are razor thin?

Even with strong yields this year, many of the farmers, he notes, “could not outyield the balance books.” Commodity prices have not kept pace with rising costs, he says, leaving farmers struggling to keep their operations in the black.

Costs Have Soared, Partly Due To Regulations
Dowdy contrasts his early years in farming with today’s reality. When he started farming in 2008, his first tractor cost between $150,000 and $175,000. Now, he says, a similar horsepower tractor “can run roughly three times that dollar amount.”

He traces a significant part of that escalation to emissions and environmental regulations that began ramping up in the late 2000s. He recalls an initial price jump, followed by annual increases of 6% to 8% since then, compounding the burden on farm finances. The complexity that comes with the machinery systems, he argues, also has stripped farmers of their ability to repair their own equipment.

“You can’t work on [equipment] without a computer. Even the technicians can’t work on them without a computer,” he mentioned on a recent AgriTalk segment.

Noting not all of the price jump is due to emissions controls, Dowdy believes the regulatory wave gave some manufacturers cover to raise prices.

Tension Between Policy and Reality
Dowdy’s comments on AgriTalk came following a White House roundtable on Monday tied to a new $12 billion “bridge payment” plan . President Donald Trump said his administration will move quickly to ease environmental requirements affecting tractors and other farm machinery , arguing the changes will lower sticker prices and simplify repairs.

On Wednesday more news followed with Ag Secretary Brooke Rollins and Health Secretary Robert “F” Kennedy Jr., announcing a $700 million initiative for regenerative agriculture .

Dowdy said he’s not opposed to supporting agricultural niches — all of the profitable corn and soybean growers he and Total Acre business partner David Hula met with recently have some kind of specialty angle.

“If there’s a little help for those guys, I don’t have a problem with it. But at the end of the day, the row crop farmers are where the help needs to be,” he notes.

Part of the help has to do with machinery costs. He highlighted cotton pickers as one example.

“The cotton industry’s got one manufacturer that I’m aware of that makes a cotton picker. One. And it’s $1.2 million,” he says. “Where’s the competition that helps make that thing affordable?”

Dowdy doesn’t claim to have all the answers, but he would like a “seat at the table” to have a candid conversation with policymakers and regulators focused on one core goal: bringing equipment and input costs back within reach so farmers can keep their operations viable.

“I’m all for the farmer,” Dowdy says. “If the farmer wins, everybody wins.”

Dowdy and Hula address farmer profitability needs in more detail in their new Breaking Barriers With R&D podcast, available here:

You can also catch the AgriTalk discussion between Dowdy and Host Davis Michaelson below:

How Trump’s Bridge Payments Could Affect Farmland Prices

Wed, 10 Dec 2025 18:11:55 GMT

Farmers National Company president Paul Schadegg sees the recently announced $12 billion in bridge payments to farmers having a variety of effects on the ag economy.

“They think it’ll be a shot of adrenaline to the ag economy,” he says on “AgriTalk.” “There are some people who say they’ll use it to pay down debt or use for operating cash. Some need a new combine or tractor, and it might go toward that. And subsequently, it could add to the cash a buyer has in their pocket that they can deploy toward a land purchase, so it’s going to cover a broad spectrum.”

The bridge payment announcement coincides with the busiest time of year with higher volumes of land sales.

“It’s really active this time of year. We see a lot of land sales between October and March. We’re in the thick of it now,” Schadegg says. “The pipeline is full as we get into January and February for land sales.”

Steve Breuere from Peoples Company tells Paul Neiffer on the “Top Producer Podcast” about 40% of their land sales volume happens in the fourth quarter of the year.

Before the bridge payment announcement, Farmers National released their 2026 Farm Input Outlook. According to that report, input costs are projected to increase slightly compared to last year. Fertilizer prices are the biggest driver, most notably nitrogen. There will be modest increases in chemicals, financing costs, equipment and labor. Categories showing flat to small increases include seed, fuel and land.

Specific to cash rent, Schadegg calls out farmland in Colorado, western Nebraska and southwestern Kansas for illustrating elevated pressure on those rates because of increased input costs. However, more central areas of the country Iowa, the Dakotas and Minnesota aren’t as pressured.

Cutting Through the Confusion: White House Confirms Trade Agreement With China on Soybeans

Mon, 08 Dec 2025 15:53:55 GMT

Late last week, grain markets got a jolt. A claim about China and U.S. soybean purchases spread fast , morphed into “headline certainty” and briefly fueled market chatter that the key buying framework didn’t exist.

A marketing firm reported U.S. Trade Representative Jamieson Greer said there’s no deal with China on soybeans. That report was unverified but spread through the markets.

Then, over the weekend, additional comments, reporting and other policy analysts reiterated that China is buying U.S. soybeans because that’s what they agreed to do.

“With China, it’s always: We verify and we monitor and we watch the commitments. The commitments are quite specific,” Greer said Sunday on Fox News. “So all of these things that we’ve agreed to with the Chinese recently are very concrete, we can monitor them with some ease, and so far, we’re seeing that they’re in compliance.”

Greer said China has gotten approximately “a third” of the way through its soybean purchase commitment for this growing season.

Also over the weekend, Treasury Secretary Scott Bessent stated China is making good progress on its commitment to buy U.S. soybeans , reaching the “correct cadence,” with purchases expected to finish by February 2026, highlighting both the ongoing trade commitments and the need for continued support for farmers.

Bessent also said China’s commitment to buying 12 million metric tons (MMT) of soybeans runs through the end of February. That comment, which was seen as Bessent moving the goalpost on when China will complete its purchase commitment, also negatively impacted prices as it fueled more uncertainty.

Private exporters reported sales of 4.85 million bu. or 132,000 metric tons of #soybeans for delivery to #China during the 2025/2026 marketing year. #USDA @AgDayTV @FarmJournal @USFarmReport
— Michelle Rook (@michellerookag) December 8, 2025

Despite the mixed comments, China is still buying U.S. soybeans, a sign there is an agreement with China. USDA confirmed another 4.85 million bushel sale to China, which is 132,000 MT.

Before Monday’s confirmation, as of early December 2025, China has only booked roughly 3 MMT of U.S. soybeans toward its 12 MMT commitment for the final two months of 2025. While Bessent says China is on track to reach that commitment, the total remains far short of the target, and economists are split on whether China will meet the full volume . It’s also key to note China is actually buying, something analysts say wouldn’t happen if there wasn’t an agreement in place.

How the Market Rumor Took Off

According to Washington analyst and regular “AgriTalk” guest Jim Wiesemeyer, on Friday, at least one commodity analyst group circulated a note asserting a Trump administration official, reportedly U.S. Trade Representative Jamieson Greer, said there was no U.S.-China agreement in place for Beijing to purchase U.S. soybeans.

The problem: The claim arrived without verification. Wiesemeyer pointed out there was no transcript, no audio and no on-the-record quote. He also said there was no published statement from USTR to support the sweeping interpretation that some policy or purchasing framework had been reversed or didn’t exist.

Still, similar to what happened with a New World screwworm rumor, the rumor ricocheted through portions of ag-market media and social channels, where a single unattributed line quickly hardened into broader conclusions such as there is no agreement, the deal collapsed or China won’t buy, which according to Bessent’s comments over the weekend, isn’t true.

Wiesemeyer says soybean trade headlines are uniquely prone to rumor-driven distortion, and this flare-up checked several familiar boxes:

1) Politics gets oversimplified
Many market analysts are excellent on supply-demand fundamentals but are less reliable interpreters of negotiation tactics, tariff strategy and the way trade messaging gets used as leverage.

2) Position bias creeps in
In fast markets, some commentary “fits” preexisting long or short positions. Information that supports a bias gets amplified, while contradictory context gets ignored.

The Key Point: An “Agreement” Isn’t a Simple Yes or No

China’s soybean buying is never just about one sentence or one headline. It is shaped by a stack of moving parts, including:

tariff structures and exemptions
political leverage inside broader negotiations
Chinese feed demand and crush margins
seasonal price competitiveness (U.S. versus Brazil)

That’s why a claim like “there is no agreement” can be misleading even when it contains a sliver of technical truth. Sometimes “no agreement” means no formal, binding document in the way markets imagine, not that political commitments, buying intentions or commercial flows have stopped.

In other words: A framework can still exist even if it isn’t a tidy, enforceable contract, and purchases can still occur even if every detail hasn’t been restated publicly.

A Weekend Signal Points to a “Deal” with China

Adding context to the late-week confusion: China’s state stockpiler Sinograin plans to auction 512,500 metric tons of imported soybeans on Dec. 11, according to a notice from the National Grain Trade Center. Reuters reported analysts viewed the size of the sale, and the fact it’s the first auction in three months, as a potential signal Beijing is clearing storage space ahead of additional state-directed buying.

That kind of reserve rotation doesn’t align neatly with the idea that China’s commitments have evaporated. If anything, it’s consistent with China positioning itself for additional procurement under ongoing trade expectations.

Where Do We Go From Here?

Market talk isn’t always news. Until an official statement is issued by USTR, USDA or the White House, sweeping claims that the U.S.-China soybean buying framework has “collapsed” should be treated as exactly what they are: market noise.

And producers and traders should remember the lesson from this episode: In grain markets, a rumor can move faster than a confirmation, but it shouldn’t move your decision-making faster than the facts.