AFBF Highlights How Ag Industry Has Changed Since Last Farm Bill

The Ag industry hasn’t seen a new Farm Bill since 2018. But, really, how much could things have changed over the past eight years?

According to the American Farm Bureau Federation, the ag economy looks incredibly different.

Since 2018, U.S. farm production expenses have jumped nearly 44%, reaching a projected $493 billion this year. Farm debt has continued to grow alongside those higher capital needs. Total farm sector debt stood at approximately $402.6 billion in 2018 and is forecast to reach $605.1 billion in 2026, an increase of about 50%. USDA expects both real estate and non-real estate debt to increase in 2026.

What Does Debt Tell Us?

The Farm Bureau noted debt itself is not necessarily a sign of financial weakness. Agriculture requires substantial investment; Farmers borrow to finance land – often the largest share of a farm’s assets, equipment and operating expenses. But the combination of more debt and higher interest expenses increases debt-servicing requirements and leaves producers more exposed when margins tighten.

Increasing Farmland Values Is A Double-Edged Sword

Farmland values have been one of the strongest parts of the agricultural balance sheet. Average U.S. cropland values increased from approximately $4,130 per acre in 2018 to $6,020 per acre in 2026, an increase of nearly 46%. USDA also estimates average farm real estate values reached $4,500 per acre in 2026.

For landowners, rising values increase equity and can strengthen borrowing capacity. But land is not a particularly liquid asset and higher land values can make a farm look stronger on paper without necessarily providing the cash needed to cover operating expenses or service debt. In addition, rising values also make it harder for beginning farmers to buy land and for existing operations to expand.

When it comes to cash rents, AFBF noted those numbers moved higher as well. Average U.S. cropland cash rent increased from about $138 per acre in 2018 to $160 per acre in 2026, roughly a 16% increase. Higher rents represent another fixed expense that must be covered regardless of commodity prices or yields.

Meanwhile, prices farmers pay for crop production have risen faster than the prices they receive for their products, squeezing margins and increasing break-even costs. The numbers point to a more capital-intensive, higher-cost farm economy.

AFBF said Congress needs to pass a five-year farm bill this year, one that reflects the "financial realities farmers and ranchers face today".

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