INPUTS

Paying $1,500 a Day in Fuel for Two Tractors, Farmer Calls Input Costs Worst Since 1980s

Mon, 18 May 2026 19:35:26 GMT

Farmer sentiment heading into the midterm elections is being shaped by rising input costs, trade uncertainty and growing concerns about the future of rural communities, according to a new poll of Farm Journal readers .

More than half of the farmers surveyed say federal policies have negatively impacted their operations over the past year. And as input prices, including diesel and fertilizer, continue to climb, one Ohio farmer says these expenses, and the strain they’re shaving on his farm, haven’t been this bad since the 1980s.

Input Costs Continue to Climb

In the recent poll of nearly 1,000 farmers and ranchers, input costs ranked as the top concern among the farmers surveyed, with fertilizer, fuel and machinery expenses all contributing to tighter margins.

Fred Yoder of Plain City, Ohio, says when you break it down between the three, fuel costs are particularly burdensome this season.

“They’re all important this year, but unfortunately right now fuel is really costing us about $1,500 of cash per day to run two tractors,” Yoder says. “That’s a lot.”

(Farm Journal)

He says while diesel prices are causing the biggest concern today, fertilizer prices have also risen dramatically over the course of his farming career.

“I’ve spent many years buying potash for $90 a ton, and now it’s $670 to $700 a ton,” Yoder says. “The same potash, but it’s just a different time.”

Machinery repair costs have become another challenge, he says, because many replacement parts are imported and subject to tariffs and duties.

“A lot of those machinery repair items are made overseas and so they’re subject to tariffs and duties,” Yoder says. “It’s really kind of a perfect storm. You combine all that with inflation. We can blame the administration, we can blame the world economy, we can blame a lot of things, but they are all coming together at once.”

Yoder calls the current environment the toughest he has seen in decades, as the perfect storm of rising input prices are hammering farm operations across the country.

“It’s just ridiculous,” he says. “I’ve never seen anything this bad since the 1980s.”

Young Farmers Feeling the Pressure

Yoder says conditions have worsened over the past year, especially after many farmers delayed fertilizer purchases in hopes prices would decline.

“Why we didn’t book our fertilizer last fall for this year is because we thought it was going to go down,” Yoder says. “Instead we sat around and we booked it for a much higher price this spring.”

He says younger farmers are under increasing financial stress as margins tighten.

“I see a lot of our young farmers that are just struggling,” Yoder says. “We’ve had more dispersal sales planned for this coming year than I’ve seen since the 1980s. And that’s really unfortunate because that’s our future and we have to make sure that they have a way to survive.”

Trade Uncertainty Weighs on Farmers

While input costs are also a concern this year for Kristin Duncanson of Mapleton, Minn., she says uncertainty surrounding tariffs and trade policy are both weighing heavily on producers and contributing to broader economic concerns across rural America.

(Farm Journal)

“It would be easy for me to say that it’s just trade and tariffs and the lack of knowing exactly what’s going to happen when, but that kind of leads into the overall economy,” Duncanson says. “The price of our inputs is high. And I also have huge concerns about the slowing of the ag economy on rural communities. The implications are pretty great. And I’ve not in my 40 years, granted it’s only 40, seen a situation like this.”

Fewer Ag Voices in Washington

The Farm Journal poll also found nearly 74% of producers believe elected officials do not fully understand the realities farmers are facing.

Duncanson says agriculture still has advocates in Washington, but fewer lawmakers have direct ties to farming communities.

“Fred and I both spend a fair amount of time working with elected officials, and there are just fewer champions for us,” Duncanson says. “The members don’t have that much of an ag base anymore. And if they do, they are very caught in a real dilemma between the economy and doing things for the greater economy and really focusing on ag.”

(Farm Journal)

She says agriculture is still being heard, but by a smaller group of policymakers.

“I’m not going to say we aren’t listened to,” Duncanson says. “There’s just fewer people that listen to us.”

Yoder agrees and says the shrinking farm population has also changed public perception of agriculture.

“In my own community, we have so much lesser number of farmers,” Yoder says. “People are asking me, ‘Well, you got your planting done?’ or ‘Groceries are high, so you must be making lots of money.’ But unfortunately, it’s not true.”

He says consumers often do not realize how little producers receive compared to retail food prices.

“You take even beef, the amount you pay in the store compared to what the actual producer gets could be half,” Yoder says. “Everybody adds their cost to it.”

Yoder says farmers no longer receive the same level of understanding and support they once did.

“We’re fewer in numbers,” he says. “We’re still very efficient. But we just don’t have the perception that agriculture or farmers are hurting.”

Healthcare and Tariffs Could Shape Votes

About one in four farmers surveyed say they are open to changing how they vote in the midterms depending on the issues at stake.

Duncanson says healthcare access remains one of the biggest concerns for rural communities.

“I think a big one for us is healthcare, not just the cost, but the accessibility,” Duncanson says. “We’ve seen several rural hospitals and clinics in our area close. It’s tough to attract folks or keep folks out here when there’s not a good healthcare system.”

She says the issue ties directly back to the broader rural economy.

“Those services have closed because of healthcare costs and reimbursement rates, as well as just people not being out here or our ability to attract doctors,” she says.

(Farm Journal)

Duncanson also says renewable fuels and trade policy remain important issues for farmers heading into the election season.

“Just where people are on moving and getting creative of other things we can do with ag products and where we can sell them are also important,” she says. “Trade is a big thing still. NAFTA is up for renewal soon. We’ll all watch those things.”

Yoder says tariffs continue to dominate conversations among Ohio farmers.

“The majority has got a very, very hard line against tariffs,” Yoder says. “We hate tariffs. We want markets, and we want market-oriented programs.”

He says farmers also need policies that encourage innovation and reduce risk.

“There’s a real reason why farmers are raising mainly corn and soybeans because there’s the least risk in there,” Yoder says. “We’ve got to come up with ways that farmers cannot have such a risky time but maybe find a new alternative, a new corn, a new soybean or something to replace some of these things and maybe some of the input costs that we’re having now.”

What else did the new poll reveal? You can read the full results here.

Diesel Prices Are Breaking Records Across Multiple States, And Relief May Not Come in 2026

Wed, 06 May 2026 12:53:40 GMT

On Tuesday, President Trump stated that high gasoline prices are a “very small price to pay” for the ongoing war with Iran, arguing they are necessary to prevent Iran from obtaining a nuclear weapon. He predicted prices will “come crashing down” once the war ends. But for farmers and ranchers, diesel prices have risen more than gas, putting a further strain on already high input costs for 2026.

Trump on Oil Prices:

I looked today, it's like at 102 and that's a very small price to pay pic.twitter.com/2V8LC93wFj
— Acyn (@Acyn) May 5, 2026

To start the week, diesel prices went on another run with the national average diesel price is just 20 cents away from reaching a new all-time high. And across the country, a growing number of states aren’t waiting to get there. About six states are already seeing the national average price of diesel reach record highs.

From the Great Lakes to the West Coast, roughly a half dozen states have already smashed previous records, as a late-April dip in prices quickly faded and a fresh surge took hold.

“Diesel now averaging about $5.65 a gallon nationally. That is only about 20 cents away from a new all-time record high,” says Patrick De Haan, head of petroleum analysis at GasBuddy . “So even though we had that short-lived break, we’re right back knocking on the door of records again.”

That “break” didn’t last long. De Haan says even though diesel prices saw a bit of a respite for April, with even prices starting to trend down in mid-April, those prices re-accelerated in the last week.

New records for diesel in:
Michigan, $6.01
Illinois, $6.01
Wisconsin $5.67
(Indiana 0.2c/gal away), $6.03
(Ohio ~19c/gal away), $5.93 https://t.co/DV0387vvMR
— Patrick De Haan (@GasBuddyGuy) May 5, 2026

Now, the rally is showing up in state-by-state records, especially in the Midwest.

“Looking at it state by state, Great Lakes states have seen some tremendous refining issues that have really caused prices to rise dramatically,” he says. “Michigan has now set a new all-time record high for diesel over $6. Indiana is just a few tenths of a penny away from setting a new all-time record. Illinois has set a new all-time record. Wisconsin has set a new all-time record.”

And it’s not just a regional story. States in the West were some of the first to not just see the highest prices, but now also hit record levels.

“Out on the West Coast, Arizona set a record a couple of weeks ago, and Washington state is at an all-time record,” he adds. “So there are probably about a half dozen or so states that have set new all-time records, and again, the national average itself is just 20 cents away.”

Perhaps the most telling shift, though, is there’s no longer a low-price refuge.

“No states any longer have diesel averaging below $5 a gallon,” De Haan says. “Texas was the last holdout, and it now is above $5 per gallon. So across the board, $5 diesel is now essentially the floor, and in some areas, that’s actually the cheaper end of the spectrum.”

At the high end, prices are reaching extremes with California’s average diesel price now surpassing $8 per gallon.

Global Tensions Cloud Relief Outlook

With prices continuing to climb, farmers are looking for relief. What would it take to reverse course? That answer remains tied to global uncertainty.

“Relief may be a little bit elusive,” De Haan admits. “It really just depends on the daily developments in the situation between the U.S. and Iran—whether the Strait is open or not, or whether we’re in phases of escalation.”

The Strait of Hormuz remains a critical chokepoint for global energy supply, moving roughly 20 million barrels of oil per day.

“Nothing else matters to the oil market more than this waterway,” he emphasizes. “We’ve seen attacks that have pushed oil prices higher, which in turn pushes diesel wholesale prices up. You may get a little bit of day-to-day relief, but there really is no ‘coast is clear’ until there’s some sort of definitive resolution.”

And even then, he says a turnaround won’t happen overnight.

“If there is a definitive signal to the market, if the Strait reopens and both sides are aligned, prices could start falling within 48 hours,” De Haan explained. “But the rate of decline is likely to slow after that initial drop.”

Prices Likely to Remain Elevated Through 2026

Not only is the rate of decline projected to be slow, but De Haan says diesel prices aren’t likely to drop back to pre-war levels by the end of the year.

“Roughly half of the increase we’ve seen over the last couple of months could come down within the first few months of positive news,” he said. “But the other half could take many more months. We may not get back to pre-conflict diesel prices until late this year—or even into 2027.”

For agriculture, that prolonged stretch of elevated prices carries real consequences.

“When you look at what comes out of a barrel of oil, diesel only makes up about 25%,” De Haan explained. “Gasoline is a larger portion, so it’s been less impacted. Jet fuel, which is an even smaller share, has been hit the hardest. So it’s almost inverse to how much is produced.”

Why Diesel Is Climbing Faster Than Gasoline

If it feels like diesel prices are rising faster and hitting harder than gasoline, there’s a reason rooted in how a barrel of oil gets used.

“Diesel has seen more of the sticker shock compared to gasoline,” says De Haan. “And a lot of that comes down to what comes out of a barrel of oil.”

Not all fuels are created equally in supply. Gasoline makes up the largest share of a refined barrel, while diesel represents a smaller slice, making it more vulnerable when supply is disrupted.

“Gasoline is the top product flowing out of a barrel of oil, so it’s been the least impacted,” De Haan explains. “Diesel, on the other hand, only accounts for about 25% of a barrel, so it’s been more impacted when there are supply issues.”

That imbalance becomes even clearer when looking across the full spectrum of refined fuels.

“The most significant impact has actually been to jet fuel, which is only about 9% of a barrel,” he adds. “So if you look at it inversely—the smaller the share of the barrel, the bigger the impact we’re seeing right now.”

For agriculture, that dynamic matters more than most sectors.

Diesel isn’t optional on the farm. It’s essential. From planting to harvest, it powers tractors, trucks and the supply chain that moves commodities across the country.

“Diesel is the fuel that drives agriculture,” De Haan say. “And that’s why these price increases are so impactful, not just at the pump, but all the way through the economy.”

And while prices are already elevated, the full effect is still working its way downstream.

“Consumers really haven’t even seen the full onset of some of these higher prices yet,” he adds. “That’s going to continue to trickle through in the weeks ahead.”

Demand Holding...for Now

Even with these high prices, so far, demand hasn’t shown many signs of slowing.

“We have not seen much meaningful decrease in demand yet,” De Haan says. “We’ve seen very little, if any, diesel demand destruction so far, which tells you the economy is essentially preparing to pay these prices because it still needs the fuel.”

But there are warning signs ahead.

“If diesel nationally hits $6 a gallon, that’s likely when we start to see consumption slow,” he says. “For gasoline, that number is about $5 a gallon. We’re getting very close to those thresholds.”

Until then, the pressure continues to mount. And for farmers heading deeper into the growing season, that pressure is becoming harder to ignore.

Trump Admin to Roll Out Major Fertilizer Plan This Week, Accelerate U.S. Production Push

Mon, 27 Apr 2026 16:36:28 GMT

Agriculture Secretary Brooke Rollins says the Trump administration will unveil a sweeping set of fertilizer initiatives this week, warning that surging input costs are putting intense pressure on American farmers. Speaking at a Missouri farm on Friday, Rollins told those in attendance that fertilizer has become an issue of national security, which is why she says this week’s announcement will be broader than just USDA, also including EPA, Department of Energy, Department of Commerce and Department of the Interior.

While at GR Farms in Higginsville, Mo., on Friday to roll out an announcement on the Supplemental Disaster Relief Program (SDRP) top-up payments, Rollins described the Trump administration’s upcoming announcement on fertilizer as a large-scale investment initiative. She says while she hoped to roll out the plan while in Missouri, the administration is still finalizing the size of the funding package.

Rollins says the plan will address both immediate actions to stabilize fertilizer prices and a longer-term roadmap aimed at ensuring affordable, domestically produced supply for U.S. farmers.

Washington analyst Jim Wiesemeyer says the plan will likely need to include a mix of financial and policy tools, such as grants, tax incentives, loan guarantees outside of existing USDA programs and greater consistency in U.S. trade policy, while noting imports will still play a role, particularly for key nutrients like potash sourced from Canada.

Short-Term Fertilizer Price Pain

During her comments Friday, Rollins highlighted how quickly fertilizer prices have increased since the conflict started in Iran, outlining the additional strain it is placing on producers.

“We know that urea prices have gone up 50% over the last month. Ammonia is up 30% or more,” she said, adding that “our farmers are feeling that pinch.”

Rollins also told the crowd fertilizer has been a longer-term challenge, even before the situation in Iran caused the latest price spike.

“To be clear, this has been a problem for years. The actual numbers are lower, believe it or not, than they were even in 2022,” she says. “But nevertheless, that jump in prices overnight, we have to address.”

Framing the issue as more than just an economic challenge and one that is a matter of national security after decades of offshoring fertilizer production, Rollins says the administration views the issue as part of a broader structural problem within the fertilizer industry.

“The loss of competition in the fertilizer industry has obviously led to higher fertilizer costs over time,” she says. “When combined with what’s happening overseas with the current geopolitical issues facing our world, certainly we have come to a crossroads that requires immediate action. This is indeed a matter of national security, and we are working to tackle it head on.”

Focus on Domestic Fertilizer Production

While Rollins didn’t give details, she hinted the centerpiece of this week’s announcement will be a major push to reshore fertilizer production, backed by federal investment to accomplish that. Working with Commerce Secretary Howard Lutnick, she says the administration is preparing to direct significant funding toward building new fertilizer plants across the country, while also supporting existing projects.

“I have asked Howard to do, and his team to do, and what we’re doing in partnership is to identify a significant number ... that we can deploy into building out fertilizer plants in America,” she says.

Rollins emphasizes cutting regulatory delays will be critical to making that plan work. She says projects are already being identified nationwide, but permitting delays remain a major obstacle — with the goal of getting that process down to months versus the current years it takes.

“We’ve already begun to identify all over the country. Some are under production. How do we move them along more quickly? Some are in the permitting bureaucracy, which sometimes takes years to get through permitting,” she says. “Our goal is to, instead of years, to get to permitting in a matter of weeks, or perhaps months, so that even in one year, two years and three years, we will have facilities up and running that we will never have had that opportunity or option before.”

United States’ Energy Advantage for Nitrogen Fertilizer

Rollins also points to domestic energy resources as a key factor in expanding fertilizer output, particularly for nitrogen production.

“We became, in a matter of just a short period of time, a net exporter of LNG versus importer, meaning we were producing our own energy in America, so much so that we no longer had to rely on other countries,” she says. “The reason that is important is, as our farmers are facing these exponential nitrogen fertilizer costs, we now have the resources in America. We just have to build the facilities, the manufacturing facilities, to turn that LNG into nitrogen. So this is going to happen quicker than you would normally expect, I think because of the pieces of the puzzle that have already been put into place.”

In the meantime, Rollins says the administration is continuing short-term efforts to improve supply availability and reduce costs.

While the longer-term strategy ramps up, she says the administration is continuing short-term interventions to ease pressure on farmers. These include:

Extending a waiver of the Jones Act
Opening new import channels
Working and meeting with industry/fertilizer companies

Highlighting cooperation with domestic producers, she pointed to CF Industries as an example.

“They have said, in order to protect our farmers, we are going to stop maintenance. We are going look at holding our prices steady,” she says.

She also points to ongoing coordination with the Department of Justice.

“Last year, we signed a joint agreement, USDA did, with the Department of Justice, ensuring that farmers have access to competitive and affordable inputs,” she says. “Looking into the activities of our fertilizer companies and what has happened over the last few years, but with a new eye on potential price gouging right now.”

Long-Term Goal: Reduce Foreign Dependence

Looking longer term, Rollins says the administration is focused on reversing decades of reliance on foreign suppliers.

“America has offshored for far too long, far too much of our fertilizer production, leaving us dangerously reliant on Russia and China,” she says. “Changing that long-standing industry that is reliant on global markets won’t happen overnight,” she says. “But working with our farmers and across industry and government, we will find ways to make fertilizer that we can do here in America and make sure it is a price that our great farmers can afford.”

At the same time, the administration is increasing scrutiny of fertilizer markets. Rollins noted ongoing coordination with the Department of Justice, saying officials are taking “a new eye on potential price gouging right now.”

Ultimately, she framed this week’s announcement as the beginning of a broader shift away from foreign dependence.

Rollins says additional details, including funding levels and project specifics, will be included in next week’s announcement.

“We’re at a crossroads that requires immediate action,” she says.

Watch Rollins’ full press conference here:

USDA Deputy Secretary Stephen Vaden Says High-Level Washington Meeting Puts Fertilizer Industry on the Spot

Fri, 17 Apr 2026 20:10:03 GMT

The fertilizer market has been a growing point of tension in agriculture for years, but USDA Deputy Secretary Stephen Vaden says recent meetings in Washington marked a more direct and wide-ranging confrontation between federal officials and the companies that dominate input supply. Those discussions, he says, were not limited to USDA alone but included a broader slice of the administration’s economic leadership, signaling how central fertilizer costs have become to the national conversation on food production and inflation.

Vaden says cabinet-level officials from the Department of Commerce and the U.S. Trade Representative were present, alongside USDA leadership and state agriculture commissioners from Iowa and Georgia. Fertilizer executives were also in the room, making the meeting a rare setting where policy makers, regulators and industry leaders sat together to address pricing, supply constraints and long-term market structure.

He says the purpose was not simply informational, but confrontational in the sense of putting real-world farm impacts directly in front of industry decision-makers.

“It was an opportunity for those other cabinet officials to hear from the fertilizer company executives,” Vaden says, “and for those fertilizer company executives to hear from the secretary and me, as well as our two state counterparts who joined, about the real harm that farmers are facing from uncertainty in the market and, equally as importantly, years of elevated prices.”

Vaden says what often gets lost outside agriculture is that the current fertilizer environment is not a short-term disruption, but the continuation of a multi-year pricing trend that has reshaped farm budgets.

“For people who don’t pay attention to ag every day like your listeners do, they may think this fertilizer thing came out of nowhere,” Vaden says. “But American farmers know that we’re on year five or more of elevated prices for fertilizer, and questions about adequate supply of all fertilizer types.”

He adds that the timing of the discussions is critical, as global geopolitical tensions are only adding pressure to already strained markets.

“So I see this as an opportunity now that the attention of everyone is focused on fertilizer, not just agriculture, to begin to solve the problem that has taken years to develop and that has been exacerbated by the current situation in the Middle East,” Vaden says. “So that we don’t find ourselves in another long-term question about fertilizer supply going forward.”

USDA Pushes Industry: Bring Projects Forward or Explain the Bottlenecks

As discussions continue with fertilizer companies, Vaden says USDA is shifting the conversation from general concern to specific accountability. Rather than broad discussions about market conditions, he says officials are now asking companies to identify concrete projects that could increase supply and to explain why those investments have not yet materialized.

This approach, he says, reflects a broader strategy inside the department to move beyond analysis and toward action, particularly in areas where supply constraints have persisted for years without meaningful change.

In meetings held both jointly and separately with industry leaders, Vaden says USDA has been consistent in its message to fertilizer companies.

“We are saying the same thing to everyone who comes before the department,” Vaden says. “Be a part of the solution, don’t be a part of the problem.”

He says that includes detailed questions about whether expansion projects are already in development but stalled due to permitting delays, regulatory barriers or capital constraints. In some cases, he says, USDA is asking companies to identify where federal or state action could realistically speed up timelines.

“We are asking them what projects they have in the pipeline that they can bring on board to create new fertilizer supplies, hopefully here domestically, but if necessary, near-shoring overseas,” Vaden says. “And are there steps that we can take to make those projects move faster? Are there permits that are held up? Are there states or localities that are holding up their expansions? Are there investments that they are looking for with regard to needing capital to be able to expand their production capacity?”

He adds the department is not approaching the issue passively, but actively pressing for answers.

“We’re asking as many questions as we are making declarative statements, and we’re trying to see what levers we can pull to get more supply on the market,” Vaden says.

Market Concentration at Center of USDA Concerns

Beyond supply timelines and permitting issues, Vaden says one of the core structural concerns in fertilizer markets is the level of consolidation, particularly in phosphate production where a small number of companies control a dominant share of supply.

He says that level of concentration raises fundamental questions about how prices are formed and whether farmers are receiving signals that reflect true market conditions.

With that in mind, Vaden says USDA is focusing heavily on competition and price discovery as part of its broader review of input markets.

“With one of our fertilizer markets, there are two companies that control 90% market share,” Vaden says. “Anybody, I don’t care whether it’s fertilizer or what any other commodity you want to talk about, if there are only two major players, how can anyone be sure that the price you are paying reflects actual market conditions?”

He says the issue is not simply about individual price spikes, but about whether enough competition exists to keep pricing behavior transparent and responsive.

“In order to have adequate price discovery in a market, you need multiple players,” Vaden says.

That concern, he adds, is one of the reasons fertilizer investigations already underway by federal agencies predate recent geopolitical disruptions and continue to expand.

Vaden Details Heated Meeting With Mosaic: “A Different Tune in My Conference Room”

Among the most pointed parts of Vaden’s interview are his comments about a recent face-to-face meeting with Mosaic, one of the most influential players in the phosphate fertilizer market. He says the discussion, held in his conference room just this week, was direct and, at times, uncomfortable, focusing heavily on production decisions, capacity investment and the company’s role in a highly concentrated global market.

Vaden says he challenged Mosaic on why additional production capacity has not been brought online in the United States over a long period of time, and what barriers the company believes are preventing expansion.

He says he left the meeting with clear expectations for follow-up information from the company, describing it as an assignment rather than a casual discussion.

“I gave them a homework assignment,” Vaden says. “I told them what I expected to see, and I hope that they will get back to me as soon as possible.”

But what stood out most to him, he says, was not just what was said in the room, but how it contrasted with the company’s public messaging.

So disappointed in this response, @MosaicCompany, especially as you decide to idle two fertilizer production facilities, removing 1 MMT of supply from the world market. 🚨

Our Great President and this Administration have our farmers' backs. 💪🌾

Any sleight of hand will not be… https://t.co/GTCxcBQNgi
— Secretary Brooke Rollins (@SecRollins) April 13, 2026

In his view, there was a noticeable difference between internal discussions and external communications, particularly on social media, where fertilizer policy debates have increasingly played out in public.

“And I will say, without being able to go into details, when they were in my office, they were singing a slightly different tune than they were signing on Twitter responding to the president’s Truth Social message that you noted,” Vaden says.

He uses that contrast to underscore what he sees as a broader disconnect between industry messaging and the realities USDA believes farmers are facing.

“We need more supply, we need answers, your company hasn’t provided either of those two things,” Vaden says. “It’s about time that you did.”

Industry Responses, Trade Policy Pressure and the Mosaic Question

While Vaden applies pressure to Mosaic, he notes that not all fertilizer companies are taking the same stance on trade policy and tariffs. He points specifically to Nutrien, which he says has indicated support for removing certain trade enforcement measures.

“I was very happy after I met with the Nutrien CEO that they came out and announced we don’t need this CVD order anymore,” Vaden says.

By contrast, he says Mosaic’s position on countervailing duties and phosphate trade enforcement remains unresolved, and that broader policy decisions are now effectively waiting on the company’s response.

He characterizes the situation as fluid but heavily dependent on industry input.

“Right now the question is in Mosaic’s court, if you will,” Vaden says. “And we’re waiting for an answer from them.”

He adds that regulatory or executive action is unlikely to be taken in a vacuum while negotiations and responses are still unfolding.

“One thing that I know as a lawyer is that there’s a whole lot more possible if you have consent of the parties than if you don’t,” Vaden says. “With consent, nearly all things are possible.”

Investigations Expand as USDA Seeks Farmer-Reported Data

Alongside industry meetings, Vaden says USDA is working with the Department of Justice and Federal Trade Commission on ongoing fertilizer market investigations, with a particular focus on pricing behavior and market transparency.

He says one challenge is the nature of pricing information itself, which often reaches farmers through informal channels and can change quickly.

“We’re asking questions and waiting for answers, and we need farmers’ help as part of our question asking,” Vaden says.

He describes a pattern many farmers have reported directly to USDA, where fertilizer prices are quoted in a way that encourages immediate purchase rather than delayed buying.

“I know in my own family’s operation that you get phone calls, and those phone calls tell you ‘Here’s what the price is now, and if you wait, here’s what the price will be later,’” Vaden says. “And that later price is never lower than the price that it is now.”

To address that, he says USDA is working on a confidential reporting system designed to protect farmer identity while improving data quality for investigators.

“If they trust us with their information, if they trust us with the facts that they have, they’ll be able to remain anonymous,” Vaden says. “And the companies under investigation will not know who shared what data with us.”

“This Has Been Going On for Too Long”

Vaden closes by emphasizing that fertilizer prices and supply constraints are not a new challenge for agriculture, but an entrenched issue that has persisted through multiple years and market cycles.

He says the administration is trying to shift both short-term supply conditions and long-term structural dynamics at the same time, adding that USDA’s goal is not temporary relief, but sustained changes in supply, competition and pricing stability.

“We are focused on getting new supplies here now, and not just now, but next year and the year after that and the years after that,” Vaden says. “So that we can have guaranteed new supplies over the long term.”

Vaden’s Message to Farmers: “We’re Saying the Same Thing in Public and in Private”

At the end of the conversation, Vaden returned to what he described as the central audience for everything USDA is doing on fertilizer: farmers themselves. He acknowledged frustration is not just growing, but it has become a defining sentiment across much of farm country as input costs remain elevated and supply questions persist year after year.

He emphasized USDA’s posture is not different depending on the room or the audience, whether speaking with industry executives, other federal agencies, or producers themselves.

“I want farmers to know that when I am sitting with representatives of other cabinet departments or when I am sitting with big fertilizer CEOs, I am saying the same thing in private that you hear me saying in public,” Vaden says. “I do not change my tune. I may be slightly more polite, but I am equally as direct in terms of telling them what I think the situation is.”

Vaden says that directness is rooted in what he believes farmers are already experiencing on the ground, particularly when it comes to fertilizer pricing volatility and uncertainty in purchasing decisions. He says producers are not misreading the situation — they are responding to real, long-running pressures.

He also acknowledges the emotional toll on producers is part of the reality USDA is hearing more frequently.

“I especially communicate to them that farmers have gone from exasperation to anger with the situation that we have now,” Vaden says. “They are not wrong to be feeling those emotions because they understand that this is not a new situation.”

Looking ahead, Vaden says USDA’s goal is not just to address short-term pricing spikes, but to change the underlying conditions that have kept fertilizer costs elevated for years. That includes expanding supply, increasing competition and improving long-term stability in input markets.

“This is an issue that has bedeviled American agriculture for at least five years, and it is time that it stopped,” Vaden says.

Trump Warns Fertilizer Giants Against "Price Gouging" as Costs Soar 40%

Tue, 14 Apr 2026 15:46:56 GMT

Fertilizer market volatility is once again taking center stage as geopolitical tensions disrupt global supply lines and push input costs sharply higher. New analysis shows the increase in fertilizer prices may not be over, even if the Strait of Hormuz reopens soon.

Even with the situation in Iran pushing prices even higher, the sharp increase in fertilizer prices from 2020 to now is catching attention in Washington. Not only did President Donald Trump take to social media to warn of ‘price gouging,’ but Agriculture Secretary Brooke Rollins also posted on X Monday, specifically expressing frustration over Mosaic’s response to farmers.

While Rollins and USDA Under Secretary Stephen Vaden have raised concerns over fertilizer prices this year, the president posted on Truth Social over the weekend that he is closely monitoring fertilizer prices and pledged support for American farmers.

Trump said Saturday on his Truth Social platform he is “watching fertilizer prices CLOSELY” during what he described as the US “FIGHT FOR FREEDOM in Iran”, adding that the administration “will not accept PRICE GOUGING from the fertilizer monopoly”.

On Monday, Rollins posted on X, saying she was “So disappointed in this response” from Mosaic, “especially as you decide to idle two fertilizer production facilities, removing 1 MMT of supply from the world market.”

So disappointed in this response, @MosaicCompany, especially as you decide to idle two fertilizer production facilities, removing 1 MMT of supply from the world market. 🚨

Our Great President and this Administration have our farmers' backs. 💪🌾

Any sleight of hand will not be… https://t.co/GTCxcBQNgi
— Secretary Brooke Rollins (@SecRollins) April 13, 2026

Mosaic announced last week the decision to shut down major phosphate operations in Brazil, a move the that will cut production, reduce jobs, and signal a *strategic shift in how the fertilizer giant deploys its capital.

Mosaic Company announced Thursday it will idle two phosphate facilities in Brazil as part of a broader effort to cut costs and shift capital. Mosaic expects idling of the facilities to reduce annual phosphate production by approximately 1 million tonnes. CEO Bruce Bodine says the decision reflects what he calls a disciplined focus on long-term returns.

.@MosaicCompany, you’re right that U.S. farmers are facing a difficult economic situation, only made worse by the extra $6.9 BILLION they have had to spend on fertilizer since you petitioned the government to place duties on imported phosphorus. This has played a major role in… https://t.co/UuOqjE0jBu
— National Corn (NCGA) (@NationalCorn) April 13, 2026

Mosaic and Simplot have also been in the cross hairs of the push to remove countervailing duties on Moroccan phosphate . Groups like the National Corn Growers Association (NCGA) claim the CVDs are costing U.S. agriculture $1 billion each year.

The CVDs on Moroccan phosphate were put into place by the International Trade Commission (ITC) in 2021. As the sunset review begins, more than 50 state grower groups including the Texas Corn Producers Association, sent a letter to the U.S. Department of Commerce and the ITC to revoke the countervailing duties on imported phosphate fertilizers from Morocco and Russia.

In separate filings by Mosaic and Simplot to the ITC and the Department of Commerce, both companies said the continuation is necessary to maintain a “level playing field.”

In a written response to Farm Journal, Mosaic said:

“American farmers depend on a strong domestic fertilizer industry, which in turn depends on strong enforcement of U.S. trade laws that ensure a level playing field. Mosaic is proud to support U.S. agriculture with high-quality, reliable products produced here at home.”

Iran War’s Current Impact on Fertilizer Prices

The message from the Trump adminstration comes as tensions escalate in the Strait of Hormuz, where the United States is weighing a potential full naval blockade. Ship traffic through the critical waterway has already dropped from roughly 135 vessels per day to the single digits. A complete shutdown could halt flows entirely, further increasing fertilizer prices.

The stakes are high as roughly one-third of global fertilizer shipments move through the strait, and the disruption is already sending prices higher, up more than 40% compared to a year ago.

It is the 6-week anniversary of the closure of the Strait of Hormuz. Fert price comparisons:

NOLA urea - +$230 or 49%
NOLA UAN - +$145 or 38%
Midwest NH3 - +$245 or 32%
NOLA DAP - +$130 or 21%
NOLA potash - +$10 or 3%

...corn - 2-cents or 0.5% higher#sickeningforfarmers
— Josh Linville (@JLinvilleFert) April 10, 2026

Market data shows the impact Iran is having on already high fertilizer prices. According to StoneX analyst Josh Linville says in the six weeks since the war started:

Urea prices have surged by $230 per ton, a 49% increase
UAN is up $145 per ton, or 38%
Anhydrous ammonia has climbed $245 per ton, a 32% jump.
In contrast, corn prices have barely responded, rising just two cents, or about half a percent. The divergence is putting additional pressure on farm margins.

DOJ Probe Into Fertilizer Costs Seeks Input From Farmers

The Trump administration is asking farmers to help provide information as part of an ongoing U.S. Department of Justice investigation into elevated costs for fertilizer, machinery and other key agricultural inputs, according to reporting from Bloomberg.

Bloomberg reported the effort is aimed at gathering more on-the-ground data as regulators examine whether fertilizer producers may have coordinated to raise prices. The DOJ investigation was first reported in early March, when Bloomberg said federal officials had begun looking into whether fertilizer companies engaged in price coordination.

According to the Bloomberg report, Vaden said he has already met with officials at both the Department of Justice and the Federal Trade Commission to discuss potential lines of inquiry. He also noted that farmers could play a key role in the process.

Vaden said farmers “have a lot of information that might be relevant to these investigations.”

Bloomberg previously reported in early March that the Department of Justice is investigating whether fertilizer producers colluded to increase prices.

Speaking at the North American Agricultural Journalists’ annual conference in Washington on Monday, Vaden encouraged farmer participation in the probe, emphasizing confidentiality protections.

“We need farmers to help provide us with that information on a confidential basis, so that that can help inform the investigations that are ongoing,” Vaden said, according to Bloomberg. “I think we will have a mechanism in order to help encourage that exchange of information.”

NCGA Surveys Show Not All Farmers Have Fertilizer Secured for 2026

Against that backdrop, along with fertilizer prices climbing even higher in the six weeks after the conflict started with Iran, new surveys results from NCGA highlight how those market pressures are translating to on-farm realities.

Krista Swanson, chief economist for NCGA, says the organization conducted the survey to better understand fertilizer availability from the farmer perspective. Ag Secretary Rollins has told mainstream media that 80% of farmers have fertilizer locked in for 2026, but NCGA data contradicts that figure.

“We’re hearing that number being thrown around too, which is why we really wanted to find out directly from farmers what the status is for them,” Swanson says.

NCGA Grower Survey

(National Corn Growers Association (NCGA))

A Significant Gap in Fertilizer Readiness

The surveys show that only 60% of farmers report having their nitrogen fully purchased or secured for the 2026 growing season, while 64% say the same for phosphate. That leaves a sizable portion of producers still working to lock in supplies.

“When you think about over 500,000 corn farmers in the U.S., this isn’t a small number,” Swanson says. “Our survey results indicate that over 200,000 farmers still need at least some fertilizer for this year.”

Nitrogen remains a critical input for corn production and is closely tied to yield potential. Any shortfall, whether driven by availability or cost, can directly affect productivity and profitability.

NCGA Grower Surveys

(National Corn Growers Association (NCGA))

Younger Farmers Feeling the Pressure Most

The survey also points to uneven impacts across the farm sector, with younger farmers facing greater challenges in securing fertilizer.

Swanson says younger producers reported having more nitrogen left to purchase compared to older farmers.

“You think about younger farmers that have less capital already built up in their business, maybe tighter cash flow needs because of their equity position,” she says. “This does seem to have a disproportional impact on younger farmers.”

That dynamic raises concerns about financial strain among newer operations in a high-cost environment.

Corn Acres Likely Stable, But With Reduced Inputs

Despite the challenges, most farmers are not planning to reduce corn acreage. The survey found that 80% of respondents expect to maintain their planned acres.

NCGA Grower Survey

(National Corn Growers Association (NCGA))

At the same time, fertilizer application rates may fall short. Half of the farmers surveyed say they do not expect to apply their full amount of fertilizer.

“Pairing these two together, it seems to me like we are still going to see a lot of corn acres get planted,” Swanson says. “But those corn acres will have less fertilizer than maybe what they would have otherwise had.”

That combination could limit yield potential if input reductions become widespread.

Growing Concern Shifts to 2027

While fertilizer availability remains a concern for 2026, attention is already turning to the next crop year. Fertilizer purchasing follows a rolling cycle, and planning for 2027 will begin soon.

Survey responses show that for every one farmer more concerned about fertilizer price and availability for 2026, nearly two are more concerned about 2027.

NCGA Grower Survey

(National Corn Growers Association (NCGA))

“So farmers are concerned as we look ahead to next year,” Swanson says.

The shift reflects uncertainty about how long supply disruptions and elevated prices will persist.

Supply Chain Recovery May Take Time

Even if geopolitical tensions ease, relief may not come quickly. Swanson notes that the fertilizer market is still dealing with production disruptions and supply chain backlogs.

“A short-term ceasefire has limited immediate impact on this ongoing fertilizer crisis for farmers,” she says. “Even when a permanent end to the situation is reached, we’re still looking at recovery from supply chain backlogs and halted production that could take a long time to recover from.”

Damage to key inputs such as liquid natural gas and sulfur production could take years to repair, keeping pressure on supply.

A Tightening Outlook

The NCGA survey underscores a challenging environment for corn producers. Most acres are expected to be planted this year, but not all will receive optimal fertilizer applications. At the same time, concern is building for 2027 as farmers look ahead to the next purchasing cycle.

For many producers, the issue is no longer just securing fertilizer for this season. It is navigating a period of sustained uncertainty that could shape production decisions, costs, and risk management strategies across the U.S. corn sector.

Longstanding Concerns Over Market Concentration

In September 2025, USDA and the U.S. Department of Justice signed a Memorandum of Understanding, committing both agencies to jointly examine high and volatile input costs, which included fertilizer, by scrutinizing competitive conditions in agricultural markets and enforcing antitrust laws, particularly around price setting and market concentration.

While geopolitical tensions are the latest driver of volatility, many farm groups argue the root of the problem runs deeper. Matt Perdue, president of the North Dakota Farmers Union, says ongoing federal investigations into fertilizer pricing must lead to meaningful action.

“We appreciate the administration’s investigations into input costs,” Perdue says. “But investigations don’t do anything if they’re not followed by enforcement, and they don’t do anything if we don’t learn what came out of those investigations.”

Groups like the Texas Corn Producers Association have been raising concerns about fertilizer market concentration for years. Texas farmer Dee Vaughan says the organization began studying the issue in 2020, working with the Agricultural and Food Policy Center at Texas A&M to examine pricing trends.

“We’ve been very concerned about all of our input costs, but specifically fertilizer, because it’s the one that just keeps going up almost exponentially,” Vaughan says.

He adds those studies found a shift in how fertilizer prices are determined . Historically tied closely to natural gas costs, the study found nitrogen fertilizer pricing began tracking corn prices more closely after 2010, a change Vaughan says reflects deeper structural issues.

According to Vaughan, the small number of firms controlling the market have the data and market awareness to price inputs based on farmers’ revenue potential, rather than production costs.

“They all have economists on staff,” Vaughan says. “They know exactly what our costs are, what our income is, and they’re able to extract value based on what they see as the gross income of a farmer. It’s not based on cost of production any longer.”

Fertilizer Prices Under Fire: Monopoly or Markets to Blame?

Mon, 10 Nov 2025 17:11:27 GMT

As President Donald Trump demands a federal investigation into meatpackers for inflating beef prices , another battle over farm input costs is already heating up. Fertilizer, long one of the most volatile and least transparent costs in farming, is now drawing renewed scrutiny on Capitol Hill.

Sen. Chuck Grassley, R-Iowa, has reintroduced The Fertilizer Research Act, a bipartisan measure requiring USDA to study pricing and competition across the fertilizer market. U.S. Secretary of Agriculture Brooke Rollins says that effort will go hand in hand with a Department of Justice probe into market concentration, promising to take a look at whether farmers truly have fair choices when buying the inputs that feed the nation.

“Pressure Cooker” on Capitol Hill

Two weeks ago on Capitol Hill, lawmakers took up the issue farmers have long demanded answers for: Why fertilizer, seed and input prices keep rising while competition keeps shrinking.

The Senate Judiciary Committee’s hearing, titled “Pressure Cooker: Competition Issues in the Seed and Fertilizer Industries, ” drew fiery testimony from across agriculture. Lawmakers on both sides of the aisle say they’re hearing growing frustration from rural America.

Grassley tells the committee that farmers are being boxed in by consolidation at every level of the ag supply chain.

“Over the last 20 years, a few big companies have bought up many of the smaller seed and chemical businesses,” he says. “Those same companies now sell not just the seeds, but also the pesticides and digital farming tools that tell farmers what to plant and when. Because all these products and data systems are tied together, it’s hard for farmers to switch to a different brand.”

Sen. Cory Booker, D–N.J., delivers one of the sharpest warnings of the day.

“What’s happening in America is dire,” he says. “Congress must not just talk about the problems; we’ve got to fix them. Otherwise, American farming as we know it will be forever changed.”

Farmers Take a Stand

The goal of the hearing was to understand what’s driving record-high input prices and what, if anything, Congress can do to restore fairness and competition.

Of the six witnesses called that day, two were farmers who spoke candidly about what they’re experiencing on the ground.

Noah Coppess, a fifth-generation farmer from Cedar County, Iowa, tells senators the volatility of fertilizer pricing has turned crop planning into a gamble.

“If the market becomes too constricted, it is ultimately the farmer who loses,” Coppess says. “Fertilizer pricing has become very volatile, with wild swings of 25% to 50% from year to year. We’re asked to prepay for fertilizer three to six months before it’s applied to the soil and up to 14 months before harvest. Many contracts have a narrow window for application. If we miss it, the contract expires and the input is repriced higher or we’re charged monthly fees just to extend it.”

He says it’s forcing farmers to cut back in ways that threaten long-term soil health.

“Phosphate fertilizer has become a bare-minimum usage fertilizer on our farm because of the cost,” Coppess adds. “We simply can’t afford to apply it like we used to.”

Kentucky farmer Caleb Ragland tells the committee the same pressures are weighing on his operation.

“Farmers are paying more than ever to grow their crops,” he says. “In just five years, seed prices have increased by 18%, fertilizer by 37%, pesticides by 25%, machinery by 23% and interest expense by 37%. Seed is a key cost consideration for farmers. Advancements in seed technology and pesticides have delivered real agronomic benefits — but at an added cost. Those costs are eating away at what little margin we have left.”

Industry Response: “A Perfect Storm”

But the hearing wasn’t just about farmers. Corey Rosenbusch, president and CEO of The Fertilizer Institute (TFI), appeared before the committee to represent the industry’s view. Speaking later with “AgriTalk” host Chip Flory, Rosenbusch says the pressures farmers face are real but are largely the result of global dynamics, not domestic decisions.

“It’s a challenging time for growers,” Rosenbusch says. “In some cases, it’s even harder for the American farmer right now than it was a few years ago when markets exploded because at least, back then, commodity prices were high. Right now, it’s a perfect storm. Commodity prices are low, and input costs keep going up and up. Our message is simple: We need farmers to be successful because if they’re not, we don’t exist. But the factors driving this market are frankly outside of our control and, honestly, outside of this country’s control. Geopolitics is taking the headlines when it comes to supply and demand.”

He says Russia’s war in Ukraine, China’s fertilizer export restrictions and global energy volatility are all rippling through fertilizer markets — forces far beyond the industry’s ability to manage.

“These are global supply and demand pressures,” Rosenbusch says. “When geopolitics dominate, prices react worldwide.”

Farmers Push Back: “Too Few Suppliers”

Farmers listening to the hearing say those global explanations don’t tell the whole story.

Mark Mueller, a farmer from Bremer County, Iowa, was supposed to testify on behalf of the Iowa Corn Growers but says he was disinvited, which he believes was because of Iowa Corn’s strong stance on lack of competition in the fertilizer market.

He still attended the hearing in person and says one statement from the fertilizer industry blew him away.

“The bottom line is that we don’t have many places to get our inputs from,” Mueller says. “I might have a half dozen retailers in my county, but when you go a little farther, they all get their phosphorus from one company, their potash from two companies, and their nitrogen from maybe three, and it’s the same problem in the seed industry.”

Mueller says one comment from the industry’s leadership stuck with him.

“The most disingenuous statement I heard came from the CEO of the Fertilizer Institute,” he says. “He said there are 20 unique companies supplying fertilizer inputs to the industry. That’s like General Motors saying they’re made up of four or five unique companies — Buick, Chevrolet, GMC and Cadillac. It’s all one company.”

“It’s Not a Monopoly — It’s an Oligopoly”

Josh Linville, vice president of fertilizer at StoneX Group, agrees the U.S. fertilizer market isn’t a monopoly, but he says it operates much like one.

“Here’s why I can’t be a politician,” Linville jokes. “No, there isn’t enough competition. It’s not a monopoly, but it’s definitely an oligopoly. When you look at nitrogen, three players control the vast majority of production. For phosphate, there’s one main producer. For potash, we’re highly dependent on imports. Almost all of it comes from Canada. So yes, we have some competition — but not enough.”

Linville says fewer players mean tighter supply chains, and that amplifies every global shock, from wars to tariffs.

“A lot of what’s happening is global supply and demand,” he says. “But the lack of competition doesn’t help. Tariffs, countervailing duties and even the fear of new sanctions on Russia are inflating prices that global trade already pushes higher.”

Concerns Potential Government Trade Aid Payments Further Inflate Fertilizer Prices

There’s yet another wildcard this year: the potential for the White House to release tariff aid payments. USDA Deputy Secretary Stephen Vaden confirmed on AgriTalk the agency is preparing to roll out $12 billion in trade aid once the government reopens.

Linville says the potential for new government aid has some unintended consequences for the fertilizer market.

“Unfortunately, no,” Linville says when asked if fertilizer prices might ease if aid payments don’t go out. “If the payments come out, I’m afraid it’s gonna boost fertilizer prices. It doesn’t change the supply and demand for most of these products, but it does change the timing, and timing is everything.”

Linville says the fertilizer market is as much about when farmers buy as it is about how much they buy. Injecting fresh cash into the market at once could cause a surge in demand that suppliers can’t absorb smoothly.

“If there’s a big fat check that goes into the farmer’s pockets and that gets spent on fertilizer, and you pull all that demand into one period, fertilizer is going to see its prices boosted as a result,” he adds. “We saw that the last time the checks went out.”

Read More: Tariff Aid Payments Could Backfire, Boosting Fertilizer Prices, Analyst Warns

Little Hope for Price Relief

When asked whether fertilizer prices could ease before spring, Linville doesn’t sugarcoat it.

“You know me — I’m never going to deal in guarantees,” he says. “I’m not going to say prices can’t fall between now and spring, but the second I do, the market will humble me again. We’ve got some improvements: China’s exporting a little more, Russia’s exporting more, there’s more peace in the Middle East, but we still have production problems in Europe, and China’s slowing exports again. Phosphate exports are being cut in half this year, and the world doesn’t have anyone ready to fill that gap. So could prices fall? Yes. But I’m not holding my breath.”

Stockpiling Isn’t a Solution

When asked on “AgriTalk” whether stopping exports and stockpiling product domestically could help ease prices, Rosenbusch says the U.S. doesn’t have that capability.

“Even if we wanted to take a page out of China’s book and stop exports, we couldn’t,” he says. “We still have to import 40% of our phosphates. We don’t have the infrastructure to stockpile fertilizer in this country. It just doesn’t exist.”

A Critical Step Forward

In what’s being hailed as a small but meaningful win for the U.S. farm economy, the Trump administration recently added phosphate and potash to the list of 10 minerals deemed critical to national security. The designation could help accelerate mining permits and spur new domestic investment — something both industry and lawmakers say is badly needed.

But for farmers testifying before the Senate Judiciary Committee, the message was clear: They can’t wait years for market reform.

“Fertilizer is the biggest pain point on farms today,” Coppess says. “We need change, and we need it soon.”

KC Fed: Ag Economy Slowdown Continues

Mon, 25 Nov 2024 20:52:29 GMT

According to Cortney Cowley and Ty Kreitman at the Federal Reserve Bank of Kansas City, high production expenses and lower prices for commodities continue to be a one-two punch to farmer balance sheets. Also dealing a heavy blow, farm loan repayment rates declined at a faster pace than one year ago—in all reporting regions—underlining how it is more difficult for borrowers to repay loans.

Cowley and Kreitman note: “Financial conditions fell at the fastest pace in the Minneapolis and St. Louis regions. Declines were more muted in Chicago, Dallas, and Kansas City regions, which could be due to larger contributions from livestock production in those areas.”

They also shared perspective on interest rates, “Farm loan interest rates declined slightly alongside recent reductions in benchmark rates. The Federal Open Market Committee lowered the target range for the federal funds rate by 50 basis points in mid-September and interest rates on farm loans across all Districts declined by about 14 basis points, on average during the survey period in the second half of the month. In the Chicago region, interest rates fell by 40 basis points, the largest decline since the first quarter of 2020.”

Earlier this month, The American Bankers Association and the Federal Agricultural Mortgage Corporation (Farmer Mac) released their annual survey indicating only half of farmers will be profitable in 2024. That study also delineated the differing economic conditions for row crop and livestock producers.

And last week, members of the U.S. Senate Ag Committee brought attention to the financial risk farmers are facing. Sen. Cindy Hyde-Smith (R-Miss.) and Sen. John Boozman (R-Ark.) shared perspective that one in five farmers could be forced out of business without financial assistance.

How Low Will We Go? USDA Expected To Cut Their 2024 Net Farm Income Forecast

Tue, 03 Sep 2024 18:42:31 GMT

USDA’s Economic Research Service (ERS) will provide an updated 2024 net farm income forecast on Thursday. Even with improvements in livestock margins, the August Ag Economists’ Monthly Monitor showed the majority of ag economists expect the further deterioration in crop prices to weigh on the overall net farm income picture and force the agency to revise their forecast lower.

As the concerns about the ag economy pour in, there’s no doubt the ag economic picture has changed. The price of grain and oilseeds is down, while the livestock picture has improved since the beginning of the year.

Scott Brown, interim director, Rural and Farm Finance Policy Analysis Center (RaFF), University of Missouri, points out the net farm income situation would look even worse if it weren’t for more positive prices in livestock.

“Let’s not forget, February was the last time they did their net farm income forecast. And a lot of things have changed from early this year to where we sit today,” Brown said. “I do expect some revisions. Crop receipts are going to be lower than what they would have said back at the start of the year. Cattle probably higher. Hogs probably higher. Dairy probably higher. But I also expect production expenses at least not to go up from where they were originally in the first part of the year. So I’m curious how all those different pieces balance out at the end of the day.”

The August Ag Economits’ Monthly Monitor, a survey of nearly 70 ag economists from across the U.S., found:

Nearly 57% expect USDA to revise its forecast
Thirty-six percent think the revision will be 5% to 10% lower
Seven percent think USDA will leave its forecast unchanged from February

USDA is set to revise its 2024 Net Farm Income forecast in September.

(Lindsey Pound)

A Look Back at February

ERS gave its first glimpse at 2024 Net Farm Income in February with the Farm Sector Income & Finances: Farm Sector Income Forecast. At that time, the USDA ERS forecast showed net farm income to fall after reaching record highs in 2022.

The USDA ERS’ forecasts showed:

· Net farm income, which is a broad measure of profits, reached $185.5 billion in calendar year 2022 in nominal dollars.

· After decreasing by $29.7 billion (16%) from 2022 to a forecast $155.9 billion in 2023, net farm income in 2024 is forecast to decrease further from the 2023 level by $39.8 billion (25.5%) to $116.1 billion .

· Net cash farm income reached $202.3 billion in 2022. After decreasing by $41.8 billion (20.7%) from 2022 to a forecast $160.4 billion in 2023, net cash farm income is forecast to decrease by $38.7 billion (24.1%) to $121.7 billion in 2024.

The Ugly Truth

The reality is glaring. USDA’s net farm income forecast for 2024 is a $43 billion drop from 2023 to $116.1 billion. That is a 25.5% decline in just one year. What makes it even more jarring is that follows the 2023 net farm income figure, which saw a 16% drop from 2022. If USDA’s forecast holds true, that will mark the most significant two-year farm income decline in U.S. history.

“The $90-billion drop over a two-year period is certainly the largest dollar value drop, adjusted for inflation, that we’ve seen in our history,” said Ben Brown, an agricultural economist with the University of Missouri. “It exceeds the previous record set in the mid-1970s. When it comes to percentage changes, we’ve seen larger percentage changes. But you’d have to go all the way back to the Great Depression era and the early 1930s to find bigger percentage declines.”

Ben Brown also thinks USDA will revise it’s forecast lower in the upcoming report, possibly even revising their 2023 forecast, as well.

“The big change I think we could see in an update would be the 2023 farm income numbers revised lower even from where they were,” Ben Brown.

Your Next Reads: More Than 50% of Ag Economists Now Think the U.S. Ag Economy is Already In a Recession

The Ugly Truth: 2023 and 2024 Will Go Down As the Two Largest Declines in Net Farm Income Ever