AgVentures takes market insights beyond the screen, bringing you closer to the people, places, and operations that shape global markets. Stand in the fields, meet the producers, experience the culture, and see firsthand what drives the markets you follow every day.

Join NoBull AgVentures in 2027 for two soybean harvest experiences in Brazil and a new destination: Argentina.

Explore the trips and reserve your spot at NoBullAg.com/AgVentures.

One year ago, I wrote that the U.S. farm economy was on an unsustainable path. Corn was in the low $4s. Input costs were stubbornly high. The trade war was putting the export program at risk. I said aid was the most likely outcome.

Four farm-aid programs announced across three crop years now total $43.8 billion, including the $8 billion Harvest Fuel Relief package just announced. Meanwhile, the Strait of Hormuz closed, diesel hit record highs, and corn rallied to $5.50 in August—a three-year high—before giving most of it back by October. In a matter of days, USDA added more than 400 million bushels to the supply side of the balance sheet.

In Purdue’s latest survey, farmers named input costs—not the price they receive—as their top concern by a record margin.

The farm economy is still on an unsustainable path, but the pressure is increasingly input-driven. Better prices and strong yields have done little to offset the cost of producing a crop.

Last year’s Ag Economy Barometer was 125. This year it’s 123. Nearly the same score, but a deteriorating situation underneath it.

In September, Purdue’s Index of Current Conditions fell 18 points in one month. The Farm Financial Performance Index dropped from 103 to 90. Capital investment fell 6 points to 39. For the first time since Purdue began asking, fewer than half of producers said the country was headed in the right direction.

A record 52% of respondents named input costs as their biggest concern. Thirty-five percent expect to be worse off a year from now; just 22% expect to be better off.

Yet long-term farmland value expectations hit a record 168. Farmers remain confident in land values, even as the financial picture on their operations weakens.

A year ago, the complaint was price. This year, it’s cost, with inputs at the top of the list.

December corn futures are about 5% above year-ago levels, but only 20 cents above the June low. It’s been a round trip: futures fell to $4.25 in June, rallied nearly $1.25 to $5.50 in early September, then gave back about 80% of the gain.

A string of USDA surprises and tougher export competition flipped sentiment from fears of tight stocks to a much more comfortable supply outlook.

Futures aren’t the price farmers receive, though. USDA’s average farm price was $4.16 in 2025/26 and is forecast at $4.70 for 2026/27. That’s higher, but still short of breakeven on many acres—and with futures back near $4.50, further reductions in USDA’s coming forecasts look likely.

Those are nominal farm prices, too. Adjusted for inflation, last year’s $4.16 equals $4.25 in September 2026 dollars. That’s below every year of the 1980s farm crisis. Only six marketing years since 1980 were lower. The inflation-adjusted average since 1980 is $5.95, nearly 30% above last year’s price.

Farm-input prices are nearly 30% higher than in 2021. Against those costs, $4.50 corn buys what about $3.55 did in 2021.

The math still doesn’t work.

That squeeze is clear in USDA’s 2026/27 outlook. Crop prices are near five-year averages: corn 8% below, wheat 7% below, rice 6% below, soybeans flat and cotton 2% above. The crop-sector Prices Paid Index is still 12% above its five-year average for the same months.

USDA’s September forecast puts net farm income at $158.4 billion, down 2.6% nominally and 5.5% after inflation. Production expenses are forecast at a record $492.8 billion, up $21.2 billion. Since February, fuel and oil estimates rose 28.8%; fertilizer, 15.3%. Government payments and farm debt are also forecast at records: $47.4 billion and $605 billion.

Net cash income is forecast to rise just 0.4%. Without the $19.5 billion increase in government payments, it would fall. Government checks are propping up income. Farmland values are propping up balance sheets. That is not sustainable long term.

Equipment costs keep rising while futures markets largely watch from the sidelines. Tariffs and other manufacturing expenses are adding to the cost of new machinery just as farmers pull back on large equipment purchases. Deere expects U.S. and Canadian large-ag sales to fall this year, yet raised its net-income forecast, with higher prices the biggest driver and construction, forestry and temporary tariff refunds adding support. The refunds ease this year’s bill, but Deere expects its net tariff costs to rise next year.

The used-market slump I wrote about last September has reversed. Sandhills Global’s September report showed used 100+ HP tractor inventories well below year-ago levels, while auction values were higher for tractors, planters and combines.

This pressure has been building for more than a decade. Yields and crop prices have generally improved, but equipment costs have climbed faster. Today, depreciation concerns are turning into a major liquidity problem. Hold onto the equipment and its value stays tied up; replace it and the gap between the trade-in and a new machine is wider. Either way, the depreciation phantom is alive and well, tying up precious capital and stealing value from equipment sitting in the shed.

When I wrote a similar update a year ago, diesel didn’t have a section of its own. A year later, fuel has become one of the biggest shocks to the system in 2026.

U.S. producers entered harvest with the national diesel average near $6 a gallon. It kept climbing, reaching a record $6.53 on September 21. By October 26, it had eased to $6.35—but that was still $2.63 a gallon, or more than 70%, above a year earlier.

In September, field fuel alone took about five bushels of corn per acre to cover, compared with a 25-year average below three. That estimate assumes 5.5 gallons per acre for field operations and excludes drying and trucking.

The government’s answer is $8 billion in Harvest Fuel Relief, with rates due in November and checks expected after the election. It’s a significant response to a significant cost. It’s also the first aid program in my career named for an input rather than a market.

Fuel is one part of a much larger increase in the cost of producing a crop.

Last year, it took 40% more dollars to grow an acre of corn than it did a decade earlier. The number hasn’t changed. In fact, it has only gotten worse.

ERS estimated corn production costs at $901 per planted acre in 2025. In June, it projected costs of $936 for 2026 and $952 for 2027, before the latest fuel and fertilizer increases. ERS’s next update is due November 10 and will likely push those estimates higher.

Farmdoc’s central Illinois budgets—on some of the best soils in the country—put all-in costs, including rent, at $1,132 an acre for 2025, $1,156 for 2026 and $1,206 for 2027.

The 2027 breakeven is $4.92 a bushel. Meanwhile, December 2027 corn settled just below $4.90 today.

For about five weeks this fall, it looked like the run of losses might finally end.

In September, Farmdoc’s central Illinois budgets projected a $59-per-acre return for 2026 corn—the first positive return since 2022—and $116 for soybeans.

Then October happened.

With December corn at $4.47 today, 2026 corn is heading back toward a $50-per-acre loss on 240-bushel ground. That would make it the fourth straight year of losses in central Illinois.

The 2027 outlook offers little relief.

Farmdoc projects a $36-per-acre corn return at $5 corn, a price above today’s market.

Soybeans still have the margin advantage, though returns are expected to narrow next year. The acreage story is already showing in the November soybean-to-December corn ratio, which hit a new high of 2.5 earlier this week.

Last September, the flashing warning sign was that second-quarter 2025 Chapter 12 filings were 60% above the four-year average. Turns out that quarter was just a warm up.

There were 315 filings in all of 2025, the most since 2020. Fast forward to 2026 and the second quarter had 115, the highest quarterly total in the series and 96% above the 2021–24 average. There were 91 more in the third quarter. Through September, 2026 filings totaled 292, up almost 20% from the same period last year.

Arkansas leads for the second year in a row, with 32 filings through September—one short of its full-year 2025 total.

Chapter 12 filings capture only part of the distress. The count excludes farms that close without filing and larger operations that file under Chapter 11.

Last year I wrote that aid was the most likely outcome. I undersold it.

Four programs. Three crop years. $43.8 billion: $10 billion of ECAP for the 2024 crop, $12 billion of Farmer Bridge Assistance for 560,000 farmers in 2025, nearly $14 billion of ARC/PLC payments tied to the higher reference prices Congress enacted last summer, and now $8 billion of Harvest Fuel Relief for 2026. All three rounds of MFP in 2018–19 paid $23 billion. Before the fuel checks were announced, USDA forecast a record $47.4 billion in government payments for calendar 2026.

I said last year that aid is never bullish. It is generally bearish and market-distorting. The other problem is that it’s inflationary for inputs: more dollars chasing the same amount of fertilizer, fuel and machinery.

With the board breaking lower and harvest nearly wrapped up, the setup is bullish for basis and nearby spreads. The break in futures is doing much of the work while aid can also ease the urgency to sell.

I distinctly remember writing this update a year ago. I had been talking with friends in Washington about the strain on the farm economy. I wrote that aid was the most likely outcome. Two weeks later, the administration was publicly discussing payments to farmers.

One year later, corn prices are higher, but margins are still squeezed. Most budgets still don’t cover all costs. Adjusted for inflation, last year’s season-average corn price was below every year of the 1980s farm crisis. Diesel is $2.63 a gallon higher than a year ago. Farm bankruptcies are up nearly 20%. Farm debt and government payments are both at records.

Yields are big, but they haven’t overcome the cost burden. When margins get tight, the answer U.S. producers know is to grow more. But when everyone does that, it only adds supply, putting more pressure on prices by default.

Low prices will eventually cure low prices with new demand. Corn has a long way to go just to catch up with current demand projections, though, much less chewing through new supply. Soybeans are different: stocks are tight, and the export program may be able to grow enough to offset any future yield increases.

The strain is real, but it varies by region. I spent the past few days in Iowa speaking with lenders and advisers at Iowa State Extension meetings. In northwest Iowa, the pain is real, but livestock and land values can cushion losses. In the Delta, those buffers are much harder to come by, leaving less to slow the bleeding.

Some words stay burned into your brain. My client and friend, farmer Marvin, told me back in 2020, “It’s always darkest before the dawn.” That line has stayed with me. I wouldn’t call this the darkest point, but it is sobering to watch producers push through harvest as crop prices fall and everything else gets more expensive. The disappointment is real. There’s little worse than working your tail off and having nothing to show for it through no fault of your own.

Sure, everyone could have hedged 150% of production at the early September highs. But that’s not how it works. You sell ahead into a rally and risk having your hands tied if prices keep climbing. Or you wait for more and watch the opportunity disappear. Mother Nature aside, raising a crop is the easy part. Marketing it is what’s difficult.

Corn just notched its fifth straight weekly loss, and wheat is on its longest losing streak in three decades.

Thus far, 2026 has been another year of getting kicked when you’re down. For a few short weeks, there seemed to be light at the end of the tunnel. It turned out to be the light of an oncoming USDA supply freight train.

Most of us thought crop prices had more room to run. For a few weeks, this time did look different. Then the rally faded. The chart below shows what didn’t change: input costs stayed high while crop prices retreated.

I will be back Sunday.

Thanks!