KC Fed: Livestock Strength Offsets Continued Weakness Across Crop Sector

Strong cattle markets are masking ongoing financial stress across crop agriculture.

A Scottish Highland Cow standing in front of a fall vista in Vermont.

Greenfield Highland Beef, FarmHER Janet Seward (FarmHER Season 5, Ep. 23)

Photo by Marji Guyler-Alaniz/FarmHER, Inc.

KANSAS CITY, Mo. (RFD NEWS) — U.S. farm income conditions remained uneven through 2025 as strong livestock markets supported revenues while crop producers continued facing lower prices and tightening margins, according to the Federal Reserve Bank of Kansas City’s Fourth Quarter Agricultural Bulletin (PDF Version).

Average agricultural commodity prices finished 2025 about 5 percent below levels at the start of the year despite strong cattle markets. Higher cattle prices alone contributed roughly three percentage points to overall agricultural price support, but declines in corn, milk, broilers, and eggs pulled the broader index lower. Crop revenues declined for a third consecutive year as large production weighed on prices across grains and oilseeds.

The livestock sector provided the primary financial offset. Higher cattle sales and modest gains in hog, turkey, and egg receipts lifted overall farm income nearly 20 percent above 2024 levels. Domestic demand for agricultural products remained solid, although exports softened due largely to weaker soybean shipments.

Credit conditions gradually weakened during the year, but broader financial stress remained limited. Farm debt levels held steady, loan delinquency rates changed little, and farmland values stayed resilient, helping stabilize balance sheets despite weaker profitability for crop producers.

Looking ahead, Federal Reserve analysts indicate that subdued crop profitability could continue to pressure credit conditions if commodity prices fail to recover, even as livestock markets remain comparatively strong.

Related Stories
The annual corn maze brings visitors to the farm while helping support its cattle and crop operation.
President Donald J. Trump announced the launch of the America First Seafood Strategy (PDF, 11.4 MB) and several actions the Trump Administration is taking to support the American seafood industry.
Association of Equipment Manufacturers’ SVP Curt Blades says lower farm income continues to weigh on tractor and combine sales as producers postpone major purchases. While recovery remains uncertain, he is optimistic heading into 2027.
September placements totaled 1.777 million head, down 12 percent from the previous year and the lowest September total since the series began in 1996.

Tony St. James joined the RFD-TV talent team in August 2024, bringing a wealth of experience and a fresh perspective to RFD-TV and Rural Radio Channel 147 Sirius XM. In addition to his role as Market Specialist (collaborating with Scott “The Cow Guy” Shellady to provide radio and TV audiences with the latest updates on ag commodity markets), he hosts “Rural America Live” and serves as talent for trade shows.

LATEST STORIES BY THIS AUTHOR:

Final details on eligible endorsement combinations are expected by the end of November.
Stronger East Coast shipments are giving U.S. corn another route to overseas markets.
Higher restaurant spending could support foodservice demand for U.S. agricultural products.
Lower production is tightening domestic supplies and pushing rice prices higher.
Growing biofuel use is helping support domestic soybean crush demand.
The special provision giving producers the higher of ARC or PLC for 2025 will not continue next year.
Higher shipping costs could make U.S. grain less competitive overseas.
Higher heating costs are putting added pressure on household budgets in rural communities.
The planned UAE facility could create a new annual export outlet for American corn growers.
Slower exports and stronger foreign competition are weighing on the U.S. pork sector.
AFBF Deputy Chief Economist Dr. Faith Parum says Title I commodity payment rates are expected in November. Producers should watch for USDA application details and contact local FSA offices.
More soybeans are being processed domestically as renewable fuels drive demand for soybean oil.