Check our advice monitor on ProFarmer.com for updates to our marketing plan.
USDA forecasts rebound in farm income in 2025 amid sharply higher gov’t payments... USDA forecasts net farm income at $180.1 billion in calendar year 2025, an increase of $41.0 billion (29.5%) from 2024 in nominal (not adjusted for inflation) dollars. After adjusting for inflation, net farm income is forecast to increase $37.7 billion (26.4%) in 2025.
Net cash farm income is forecast at $193.7 billion for 2025, an increase of $34.5 billion (21.7%) relative to 2024 (not adjusted for inflation). When adjusted for inflation, 2025 net cash farm income is forecast to increase $30.6 billion (18.8%).
Cash receipts from the sale of agricultural commodities are expected to decrease $1.8 billion (0.3%) in nominal terms to $515.0 billion in 2025. Total crop receipts are expected to decrease $5.6 billion (2.3%) from 2024, led by lower receipts for soybeans and corn. Total animal/animal product receipts are expected to increase $3.8 billion (1.4%) amid increases in receipts for hogs, milk and broilers.
Direct government payments are forecast to surge $33.1 billion (354.5%) to $42.4 billion in 2025. This increase is expected largely because of supplemental and ad hoc disaster assistance to farmers and ranchers from the American Relief Act of 2025. Total production expenses, including operator dwelling expenses, are forecast to decrease $2.5 billion (0.6%) to $450.4 billion. Feed, fertilizer (including lime and soil conditioners) and pesticide expenses are expected to see the largest dollar declines in 2025.
On the farm sector balance sheet, equity is expected to increase $156.8 billion (4.3%) from 2024 to $3.83 trillion in 2025 in nominal terms. Farm sector assets are projected to increase $176.6 billion (4.2%) to $4.40 trillion in 2025 following an expected increase in the value of farm real estate assets. Farm sector debt is forecast to rise $19.8 billion (3.7%) to $561.8 billion. Debt-to-asset levels for the sector are expected to improve slightly from 12.84% in 2024 to 12.78%. Working capital is forecast to increase 3.9%.
Senate Ag panel hearing highlights tariff concerns for U.S. ag sector... The Senate Ag Committee hearing on the economic situation for U.S. agriculture highlighted significant concerns about potential tariffs and their impact on the farming sector. Key topics:
- Tariff concerns and impact on input costs. Farm Bureau President Zippy Duvall warned that tariffs on Canadian potash could be “devastating” to U.S. farmers, as over 80% of potash comes from Canada. A tariff on Canadian potash could increase fertilizer costs by as much as $1.70 per acre for corn and $1.42 per acre for soybeans.
- Market access and retaliation. Both Farm Bureau and Nation Farmers Union expressed concerns about retaliatory tariffs and their potential to shrink market access for U.S. agricultural products. NFU President Rob Larew noted that even the threat of tariffs is already affecting the market, with some suppliers adding costs to goods and others not selling products for delivery beyond certain dates.
- China trade relations. Larew labeled China as a “bad actor” in trade relations but urged the U.S. to work with allies to address challenges collectively. He emphasized the importance of collaborating with other countries that also have poor trading relationships with China.
- Market access over aid. Farm groups expressed a clear preference for fair and open markets rather than government payments. Larew stated, “We want to receive our income from fair and open markets, not just payments.”
- Potential aid package. In the event of agricultural losses due to a tariff war, USDA Secretary-designate Brooke Rollins has pledged to provide aid. However, farm groups stressed that this should not be the primary solution.
USAID suspension threatens Ukraine’s ag sector... The Trump administration’s decision to suspend USAID funding is likely to have consequences for Ukraine’s agricultural industry. This funding freeze disrupts crucial support that has bolstered Ukraine’s agricultural production and exports in recent years.
USAID has played a key role in Ukraine’s agricultural development:
- 2023: Provided $12 million in equipment and distributed fertilizer and seeds to over 8,200 farmers.
- 2023: Allocated $150 million for future agricultural growth through the Harvest program.
A 90-day freeze on nearly all foreign aid, including USAID programs, has led to:
- The halting of funding for ongoing agricultural projects.
- Delays in equipment deliveries and financial assistance.
- Uncertainty for the AGRI-Ukraine initiative, which supports agricultural resilience during wartime.
Potential impacts:
- Reduced production capacity: Farmers may struggle without USAID-provided seeds, fertilizers, and equipment.
- Economic instability: Agriculture accounts for over 60% of Ukraine’s export revenue.
- Global food security risks: Ukraine plays a crucial role in global food supply chains.
- Halted modernization efforts: USAID has driven the modernization of Ukraine’s agriculture sector.
The Ukrainian government is seeking alternative funding from European allies and considering internal funding solutions. However, it remains uncertain whether these measures will fully compensate for the loss of USAID support. While the long-term effects are yet to be seen, the funding suspension threatens to reverse years of progress and undermine Ukraine’s economic stability and food security.
Cargill expands biofuels stance with SJC Bioenergia takeover... Cargill has signed an agreement to acquire the remaining 50% stake in Brazil’s SJC Bioenergia, securing full ownership of the sugar and biofuels firm. This move strengthens Cargill’s position in renewable energy. The company has been a partner in Bioenergia since 2011. The deal is pending regulatory approval.
Judge pushes back Trump federal employee buyout deadline... A federal judge on Thursday pushed back to at least Monday a deadline for U.S. government employees to decide whether to accept the Trump administration’s offer to resign with the promise of months of full pay, as a fight over the lawfulness of the buyout movement goes forward. U.S. District Judge George O’Toole in Boston could opt to delay the buyout further or block it on a more permanent basis when he next considers the legal challenge by the unions at a hearing on Monday.
More than 40,000 employees, representing about 2% of the workforce, had signed up for the resignation offer ahead of the Feb. 6 deadline, Bloomberg reported.
The Trump administration has repeated its warning that most federal agencies are likely to be downsized, a message seen by workers as pressure to accept the buyout offer. Some 116,000 workers left government service in the 2023 fiscal year, according to the Partnership for Public Service, a nonprofit. Trump said on Tuesday he wants to shutter the Department of Education, which employs 4,245 people.
Those who do not accept the buyout could still be on the chopping block later on, as the federal government said it anticipates layoffs. “At this time, we cannot give you full assurance regarding the certainty of your position or agency but should your position be eliminated you will be treated with dignity and will be afforded the protections in place for such positions,” wrote the U.S. Office of Personnel Management.
Government workers who elect to stay on have to return to the office full time, meet new performance standards, be open to accepting furloughs and the reclassification to at-will status and adhere to “enhanced standards of suitability and conduct.”
The Office of Personnel Management said the move was part of Trump’s efforts to reimagine the federal government and said the changes to the federal workforce “will be significant.”
Federal agencies have been told to compile a list of those who have been hired within the last two years who lack full employment protection and would be easier to fire — roughly 13% of the workforce, according to government figures.
Some exemptions. Certain government positions — like immigration and law enforcement officials, national security employees and postal workers — are exempt from the “Fork in the Road” offer. But the Central Intelligence Agency is offering buyouts that are similar to the government-wide program. Other agencies could exempt specific critical positions from the resignation offer, but the extent of those exceptions is unclear.