As a child, I spent countless hours gazing at the sky. Whether riding along in the buddy seat, bucking square bales before a storm, or nestled in a hunting blind at sunrise, I was captivated by the ever-changing clouds above me. I loved spotting shapes, tracking their movement, and sensing the shift in weather they often signaled. Clouds fascinated me, and I often found myself awestruck by their ability to change the outcome of the day.
When it comes to the economy, there are clouds lingering over farm country, and the overall outlook is hazy at first glance.
One way we keep a pulse on the farm economy and profitability is through the USDA Economic Research’s Service’s (ERS) U.S. net farm income forecast. U.S. net farm income is projected to increase 37% between 2024 and 2025, due to higher livestock receipts and a bump in ad hoc government payments. Meanwhile, USDA projects crop cash receipts to decline. Despite the projected increase of net farm income, the U.S. farm sector debt is projected to increase by 5% this year. That simple projection sheds some light on the challenges producers across the Show-Me State and nation are facing with tight margins, fragile markets and unpredictable weather.
A persistent dark cloud in our skyline is high input costs. The USDA expects interest expenses (to service farm debt) to increase 5.1% in 2025, up 16% from 2022. Other farm production costs, like livestock expenses, labor, property taxes and other inputs, are expected to continue climbing. For crop producers, price volatility in the fertilizer space remains a critical issue, driven by trade and policy actions, geopolitical conflicts and broader structural issues. As we look forward, prices are anticipated to remain elevated into next year. As high crop yields deplete soil nutrient banks, producers will need to be thoughtful about managing fertility on a budget.
A cluster of clouds that can’t be missed are market shifts and uncertainty, leaving producers vulnerable. Strong livestock markets have offered critical support to the balance sheet but can be subject to demand challenges of their own. On the crop side of the equation, if projections from ERS are correct, the U.S. could see the lowest cash receipts for crop sales since 2007.
Despite the ominous clouds that linger over the farm economy, I believe there are glimmers of sunlight and clearer skies ahead. The One Big Beautiful Bill, signed in July, provides critical measures to ensure that safety nets and provisions are in place to help farmers, ranchers and rural communities move forward as legislators work on an updated farm bill. Additionally, efforts are being made to secure new trade partnerships and drive demand domestically and abroad for American agricultural products. Furthermore, Missouri Farm Bureau (MOFB) remains fully engaged, advocating for the needs of farmers and ranchers to help them continue to produce the world’s food, fuel and fiber.
Amid the lingering overcast, farm country is desperately looking for a break in the clouds, and with the unmatched resilience and innovation of today’s agriculture community, MOFB will be here to help farmers and ranchers weather the storm.
