Growing Trouble: Farm income drops as debt and machinery prices escalate

Farmers are struggling with low commodity prices and skyrocketing input costs, resulting in debt that is outpacing income across the sector, according to the USDA’s new farm income forecast.

A new farm income forecast from the Economic Research Service (ERS) is out this week, showing a several billion dollar decline from estimates earlier this year. But in a call with farm reporters, U.S. Senator Chuck Grassley (R-IA) said it’s still too early to tell if farmers will need a bailout.

Farm-Income-Forecast-Sept-2025.png

Farm sector profits forecast to grow in 2025

USDA, Economic Research Service, Farm Income and Wealth Statistics, Data as of Sept. 3, 2025

The income forecast indicates the amount of cash farmers and ranchers have available this year, which is less than the U.S. Department of Agriculture (USDA) estimated in February.

Also, a large number of borrowers are reporting trouble at the farm. New federal numbers show more banks are realizing some loans likely won’t be paid back.

Machinery Costs Break the Bank

Machinery costs are just one input cost that has increased over the last couple of years. Several universities have researchers looking into it, and they’ve found a 10% jump for some models.

Related Stories
The 91st anniversary of Black Sunday highlights how the Dust Bowl disaster led to modern soil conservation programs still shaping U.S. agriculture today.
Steven Snow with the U.S. Small Business Administration joined us to discuss tax relief for rural Americans and the long-term benefits of new provisions impacting farmers and small businesses.
As budget hearings continue on Capitol Hill, policymakers focus on long-term solutions to stabilize the fertilizer market to support U.S. farmers.
Rising global supplies may cap soybean price strength, while sorghum prices hinge heavily on China’s export demand.

LATEST STORIES BY THIS AUTHOR:

Jake Charleston, with Specialty Risk Insurance, joins us now for an industry update and advice for cattle producers as they consider options for managing the risks of a murky market.
The National Milk Producers Federation will launch a new advocacy campaign to secure a final vote, urging House lawmakers to approve the bill as soon as they return from the Thanksgiving recess.
AFBF Vice President of Public Policy and Economic Analysis, Dr. John Newton, explains the factors contributing to the growing financial strain in the ag sector and the urgent need for swift economic support.
Tyson’s Nebraska plant closure and falling Cattle on Feed numbers send cattle markets tumbling. Analysts warn of tighter supplies, weak margins, and rising global competition.
Texas Ag Commissioner Sid Miller warns horse owners after EHV-1 cases linked to the Waco WPRA Finals. Horses linked to recent Waco events should be isolated and closely monitored, as early action is critical to stopping the spread of EHV-1.
One trader said the products entering the U.S. are primarily grind and trim, noting that the volume and type of beef, on its own, should not cause a major disruption. However, he says fund traders are reacting heavily to headlines rather than market realities.