Farm Budgets Squeezed by Soaring Inputs, Interest, and Labor Costs

AFBF Associate Economist Samantha Ayoub joins us to dive into H-2A visa program changes and what can be done to ease the pressure on producers.

WASHINGTON (RFD-TV) — As harvest rolls on and farmers study their balance sheets, they see just how squeezed they are by rising input costs and low crop prices. American Farm Bureau Federation (AFBF) economists break down some of those costs.

“Fertilizer is rising again. It’s still not to those highs of 2022, but it’s going up—chemicals, fuel, and energy,” said Faith Parum with AFBF. “Interest is really becoming a larger and larger expense in farm budgets, as farmers continue to take out operating loans to make it to the next marketing year, due to all of the decreases in commodity prices. Labor is always increasing, as well as some machinery and repairs.”

AFBF economists say several crop farmers are already facing losses, with cotton down over $300 per acre.

Reforming the H-2A Visa Program to Reduce Farm Labor

For many farmers, reducing farm labor costs is one significant way to ease their input cost burdens. The U.S. Department of Labor is implementing changes to how foreign agricultural guest workers are paid under the H-2A visa program, revising the method used to calculate the Adverse Effect Wage Rate (AEWR) — the minimum rate employers must pay to ensure domestic wages aren’t undercut.

The adjustment comes as a relief to many farmers and ranchers who have long called for reform, saying previous wage calculations were inconsistent and burdensome.

Samantha Ayoub, Associate Economist with the American Farm Bureau Federation, joined us on Thursday’s Market Day Report to dive into those labor concerns and what can be done to ease the pressure on producers.

In her interview with RFD-TV News, Ayoub explained that the new rule outlines a more standardized process for setting wage rates. However, she noted that non-wage costs—such as housing, transportation, and compliance—remain significant factors for producers using H-2A labor.

Ayoub emphasized that labor remains one of the highest costs in agriculture today, but feels these changes could bring greater predictability to farm labor expenses.

Related Stories
Dr. Rosslyn Biggs with the Oklahoma State University Center for Rural Veterinary Medicine shares insight into biosecurity, preparedness, and animal health concerns facing livestock producers as New World screwworm outbreaks continue in Mexico.
As the new year begins, both farmers and rural families are taking stock of their finances and planning ahead for 2026.
Strong export demand supports feed grain prices, but drought risk and seasonal patterns favor disciplined early-year marketing.
Roger McEowen with the Washburn University School of Law joined us to provide legal insight and context on these issues facing agriculture. Today, he discusses pesticide litigation.
Sen. Deb Fischer reintroduces the HAULS Act to update hours-of-service exemptions and definitions affecting livestock and agricultural haulers. She joins us on Market Day Report to share more about her proposed legislation.
Strong crush demand and rising ethanol production are pressuring feedstocks, as traders monitor storage risks and supply chain uncertainty and await the upcoming January WASDE report.
Last year was a busy year for pesticide litigation in the United States. At No. 10, it kicks off RFD-TV Legal Expert Roger McEowen’s list of the “Top 10” Agricultural Law and Tax Developments of 2025.
Benchmark machinery costs against those of similar-sized, high-performing operations to inform equipment and investment decisions.