Скачать или смотреть "Multiple levers" required to buoy grain farmer profitability

Margins in the U.S. cropping sector are tightening, with producers of corn, soybeans, wheat, and cotton seeing financial returns slip below break-even levels—even in a year with promising yields. The economic strain is raising questions about the adequacy of current farm policy and the urgency of support for struggling producers.

John Newton, executive head of agricultural economics firm Terrain, says the U.S. farm economy is experiencing significant pressure, especially in row crops. “We are in a real tough spell here right now from a profitability perspective,” he says. “Most of these crops are entering their third or fourth year with margins that are at or below break-even.”

Cotton, in particular, is facing severe challenges, with some producers seeing losses upwards of $400 per acre. Newton highlighted a producer’s testimony from Texas who noted current cash bids were lower than what her grandfather received 60 years ago for cotton.

While livestock—particularly cattle—has performed well recently, Newton warned that upcoming U.S. Department of Agriculture (USDA) reports may paint an overly optimistic picture by averaging high livestock profits with poor cropping returns. “It’s really masking what’s happening in the crop sector,” he said.

Policy solutions, Newton noted, will need to be multi-faceted. He pointed to year-round E15 ethanol availability, ag labour reform, and regulatory rollbacks as critical levers. However, political instability remains a hurdle. “Capital doesn’t like that,” Newton said, referring to frequent policy reversals driven by shifting party control. “They like to know what’s coming their way before they make these large-scale investments.”

Labour also remains a concern, with Newton stating that approximately 40 per cent of crop labour comes from undocumented workers. The H-2A visa program, plagued by unpredictable wage rate changes, adds to the uncertainty.

As fall approaches, Newton said Washington is still in information-gathering mode, exploring temporary or administrative fixes to support rural economies. “They’re looking in the toolbox,” he said. “What tools do we have to provide any type of bridge?”

The challenges highlight a broader reality: while demand-side solutions like trade agreements and biofuel expansion are in play, results will take time. For now, crop producers face another season of economic uncertainty—and are counting on swift, coordinated policy action.


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