Managing Market Volatility and Risk as Long-Term Farm Borrowing Costs Remain High into 2026

Tony Adkins with Specialty Risk Insurance addresses current market challenges for farmers and ranchers and offers strategies to help producers navigate risk.

Melissa_Eshelman_12_28_19_USA_IA_Eshelman_Farms_049.jpg

Melissa Eshelman (FarmHER Season 2, Ep. 10)

FarmHER, Inc.

SARASOTA, FLORIDA (RFD NEWS) — Long-term borrowing costs are expected to stay elevated at the farm gate, keeping pressure on financing decisions tied to land, equipment, and expansion.

Matt Erickson with Terrain Ag says inflation expectations, a higher neutral interest rate, and an elevated term premium are preventing long-term Treasury yields from falling much. Even with the Federal Reserve expected to gradually ease short-term rates, long-term yields have remained stubbornly firm.

Farm-Level Takeaway: Prioritize liquidity and discipline in a higher-rate environment.
Tony St. James, RFD NEWS Markets Specialist

That split matters on the farm. Lower short-term rates may trim some operating loan costs for seed, fertilizer, and other seasonal needs, but higher long-term rates still weigh on machinery purchases, real estate financing, and refinancing opportunities.

The pressure is especially important for capital-intensive crop and livestock operations, where debt costs can shape cash flow, growth plans, and balance sheet flexibility more than day-to-day market swings.

Erickson says strong labor markets, persistent Federal deficits, and steady consumer demand are likely to keep long-term rates higher for longer, favoring caution over aggressive leverage.

Tony Adkins with Specialty Risk Insurance joined us on Tuesday’s Market Day Report from Florida to discuss how insurance solutions are helping farmers manage risk as agricultural producers face both opportunities and challenges with navigating rising input costs and ongoing market volatility.

Adkins shared why he was in Florida and highlighted conversations around agriculture and insurance happening in regions not traditionally considered cattle country. He also addressed current market conditions, including the effects of rising input costs and volatility, as well as how insurance companies are responding to support producers.

Finally, Adkins offered farmers guidance on steps they can take to better manage risk amid uncertain economic conditions.

LEARN MORE: www.specialtyrisk.ag

Related Stories
Reduced winter placements indicate tighter fed cattle supplies and greater leverage during peak-demand months.
AFBF Economist Faith Parum provides analysis and perspective on the Farmer Bridge Assistance Program—what commodity growers should know and potential remedies for producers facing crop losses where that aid falls short.
Federal nutrition policy is signaling a stronger demand for whole foods produced by U.S. farmers and ranchers. Consumer-facing guidance favors animal protein, but institutional demand may change little under existing saturated fat limits.
Farmer Bridge payments are being used primarily to reduce debt and protect cash flow, not drive new spending. Curt Blades with the Association of Equipment Manufacturers joined us to provide insight into the ag equipment market and the factors influencing sales.
Rail strength is helping stabilize grain movement, but river and export slowdowns continue to limit overall logistics momentum.

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:

Farm CPA Paul Neiffer joined us to break down the recent Fifth Circuit Court decision overturning a prior Tax Court decision on self-employment tax for limited partners, the ruling’s impact on farmers, and potential next steps in Congress.
Americans for Prosperity Arkansas Director Ryan Norris talks energy infrastructure, regulatory reform, and the role of critical minerals in supporting rural America.
Pennsylvania Farm Show scholarship recipient Elizabeth Dice discusses her award, her background in farming, and her path forward in the agriculture industry.
Mike Steenhoek with the Soy Transportation Coalition discusses supply chain challenges facing agriculture as snow, sleet and ice threaten most of the Eastern U.S.
Congressman Adrian Smith of Nebraska joined us with the latest on efforts to secure year-round E15 sales.
Rural population growth and stabilizing economic indicators point to post-pandemic recovery, but uneven income, shifting industries, and regional divides remain key challenges for rural communities.