WASHINGTON, D.C. (RFD NEWS) — Farm profitability tightened further to begin 2026 as falling commodity prices collided with rising production costs, according to the USDA’s latest Agricultural Prices report released February 27. The widening gap between prices received and prices paid signals ongoing margin pressure across U.S. agriculture.
USDA’s National Agricultural Statistics Service reported the January Prices Received Index fell 3.9 percent from December and dropped 10 percent from a year earlier to 116.5. Crop prices drove much of the decline, with the Crop Production Index down 6.7 percent month over month, despite remaining slightly above last year’s level. Lower prices for soybeans, milk, lettuce, and eggs weighed on returns, while cattle, calves, broilers, and apples posted gains.
At the same time, producer expenses continued climbing. The Prices Paid Index rose 3.5 percent from December and stood 8 percent above January 2025 levels. Higher costs for feeder cattle, feeder pigs, taxes, and services offset modest relief from lower diesel fuel, interest, and feed costs.
Operationally, the ratio of prices received to prices paid dropped to 74, down from 79 in December and 88 a year ago — a key indicator showing shrinking purchasing power for farm income.
The report also noted temporary adjustments to cost indexes due to delayed federal inflation data, which will be revised once updated figures are available.
