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 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.
Rising costs and prices are shifting acreage toward soybeans. Most fertilizer prices are up double digits from this time last year, with Urea seeing the largest gains.
Industry leaders argue the decision could disrupt confidence in conservation practices and increase regulatory uncertainty for producers across the region.
Rising diesel and energy costs are squeezing farmers and rural communities, increasing production expenses and raising concerns about consumer demand for beef even as U.S. meat exports regain the Australian market.
Analysts warn the closed U.S.-Mexico border is straining cattle supplies and packing capacity. StoneX and USDA data point to long-term industry shifts.
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