Sign-up for the Farmer Bridge Assistance (FBA) program began on February 23 at local Farm Service Agency (FSA) offices and will continue until April 17. A total of $12 billion was allocated for the FBA program to provide economic assistance payments to producers of certain crops to offset low prices and poor profit margins for the 2025 crop year, as well as the market price impacts from tariffs on export markets for certain crops in the past year. Of that total, $11 billion of the payments will be paid to producers of traditional farm program Title I crops, which includes corn, soybeans, wheat, cotton, and rice. The remaining $1 billion will be held back for economic assistance for specialty crop producers.
FBA Sign-up Procedures
 
Eligible crop producers will receive a pre-filled FBA application form listing the eligible 2025 crop acres, based on the crop acreage report that was submitted to the FSA office. Producers only need to complete one FBA application for all eligible crops, regardless of the farm location in any county or State. Farmers can receive their FBA application form either in person at their local FSA office, or they can receive their FBA application using the FSA online system. Farmers with an existing FSA online account are able to sign-up for potential FBA payments by accessing their existing FSA account. Other farmers will also be able to set up a new online account prior to enrolling in the FBA program. For more information on the FSA online accounts, farmers should go to the following website: www.farmers.gov/account.
Once producers receive the FBA application, they should verify that the data in the application is correct and the sign the form. The completed FBA application may be submitted to FSA using the FSA online system, via email or fax, or in person at local FSA offices. In addition to submitting the FBA application on a timely basis, producers must have completed several other forms required by FSA. Most farmers that routinely receive farm program payments will likely already have these payments on file at local FSA offices. Following are the required FSA forms in order to receive FBA and other FSA payments:
• AD-1026 -Highly Erodible Land Conservation (HELC) and Wetland Conservation (WC) Certification.
• Form CCC-941 - Average Adjusted Gross Income (AGI) Certification and Consent to Disclosure of Tax Information.
• Form CCC-901 - Member Information for Legal Entities.
• Form CCC-9021 (if applicable) - Farm Operating Plan for an Individual.
• Form CCC-941 (if applicable) - Farm Operating Plan for an Entity.
• SF-3881 - Miscellaneous Payment Form (Direct Deposit authorization).
 
FBA Payment Rates for Various Eligible Crops
• Corn - $44.36 per acre
v Soybeans - $30.88 per acre
• Wheat - $39.35 per acre
• Oats - $81.75 per acre
• Barley - $20.51 per acre
• Peas - $19.60 per acre
• Sorghum - $48.11 per acre
• Cotton - $117.35 per acre
• Rice - $132.89 per acre
• Peanuts - $55.65per acre
FBA payment rates were also announced for canola, chickpeas, flax, mustard, safflower, sesame, and sunflower.
 
How FBA Payments were Calculated
FBA payments will be based on the 2025 planted acres of eligible crops, as reported to local Farm Service Agency (FSA) offices on or before December 19, 2025. For double-crop acres, both the first crop and subsequent crop are eligible for FBA payments (for example peas followed by soybeans); however, any prevent plant acres in 2025 are not eligible for the FBA payments The payment amounts for each crop were based on the national average yield times the projected 2025-26 market year average (MYA) price in the December 9, 2025 WASDE report, minus the 2025 average production cost for a commodity, based on USDA Economic Research Service (ERS) data. The MYA prices in the December WASDE report included $4.00 per bushel for corn, $10.50 per bushel for soybeans, and $5.50 per bushel for wheat.

Payment Limits for FBA Payments
The payment limit for the FBA payments will be $155,000 per eligible person or legal entity. There will not be higher payment limits based on having 75 percent of taxable income received from farming enterprises, similar to some previous FSA programs. Entities such as corporations, LLC’s, S corporations, and trusts will be limited to one payment limit of $155,000. Any person or legal entity with an adjusted gross income (AGI) exceeding $900,000, based on FSA criteria, will not be eligible to receive any FBA payments.
Following are examples of the estimated acres required to reach the $155,000 payment limit with various crop mixtures of corn, soybeans, and wheat:
· 100% Corn ($44.36/A.) = 3,494 acres
· 100% Soybeans ($30.88/A.) = 5,019 acres
· 100% Wheat ($39.35/A.) = 3,939 acres
· 2/3 Corn; 1/3 Soybeans (ave. $39.86/A.) = 3,889 acres
· 1/2 Corn; 1/2 Soybeans (ave. $37.62/A.) = 4,120 acres
· 1/3 Corn; 1/3 Soybeans; 1/3 Wheat (ave. $38.20/A.) = 4,058 acres
 
Details on the ASCF Program for Specialty Crops
An additional $1 billion has been allocated for the Assistance for Specialty Crop Farmers (ASCF) program, which will provide payments to a wide range of crops not covered by the FBA program. This includes most fruits, vegetables, nuts, horticulture crops, etc. Producers of dry edible beans and peas are eligible for FBA payments and should complete out a FBA application, as they will not be eligible for ASCF payments. There will also be separate payments for sugar beet and sugarcane producers. Similar to FBA payments, ASCF payments will be based on 2025 planted acres of various specialty and sugar crops. Specialty crop acreage must be reported to local FSA offices by March 13, 2026. Following that, payment rates and sign-up details will be announced for the ASCF program.
 
More Information on the FBA Program or the ASCF Program
Farmers that submitted their application for the FBA program shortly after February 23 reported receiving their FBA payments within a few days. Farmers with specific questions on the application process for either the FBA program or the ASCF program, or regarding payment procedures, should contact their local FSA office. For more information on the FBA program requirements, payment rates, payment limits, etc., as well as updates on the ASCF program, farmers can go to the USDA FBA website at: https://www.fsa.usda.gov/resources/programs/farmer-bridge-assistance-fba-program
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone --- (507) 381-7960; E-mail --- [email protected]

The so-called “One Big Beautiful Act” (OBBA) that was passed by Congress in 2025 made some important changes to provisions that could affect 2026 farm program and crop insurance decisions. This includes the implementation of higher reference prices for all Title I crops beginning for the 2025 and 2026 crop years, improved farm program guarantees, and increased federal subsidies for crop insurance premiums. These enhancements have raised some questions for farmers as they analyze their options for 2026 crop insurance coverage, as well as with their choice of the PLC and ARC-CO farm program option. The crop insurance sign-up deadline is March 16. No sign-up dates have been announced for enrollment in the 2026 farm program.
 
Following are some of the farm program and crop insurance questions that have resulted from the implementation of the OBBA, as well as other common questions:

• How did the OBBA affect reference prices for 2025 and 2026 ?

The statutory reference prices were increased by 10 to 20 percent for all farm program crops beginning with the 2025 crop year, and continuing for the 2026 through 2031 crop years. The new statutory (minimum) reference prices are $4.10/bu. for corn, $10.00/bu. for soybeans, and $6.35/bu. for wheat. The “effective reference prices” are based on the 5-year “olympic” average (drop the high and low) market year average (MYA) price from five previous crop years times 85% (.85). The effective reference price can be as much as 15 percent above the statutory reference price. The
 

• How will the increased refence prices affect the benchmark (BM) prices that are used to determine guarantees for the ARC-CO program ?

The BM prices will continue to be calculated based on the 5-year “olympic” market year average (MYA) price for five previous years, with no factoring. The minimum BM prices for 2025-2031 will be $4.10/bu. for corn $10.00/bu. for soybeans, and $6.35/bu. for wheat. There will be no impact on the 2025 and 2026 BM prices due to the calculated BM prices exceeding the “effective” reference prices. The 2025 and 2026 BM prices are $5.03/bu. for corn, $12.17/bu. for soybeans, and $6.98/bu. for wheat. 
 

• What are the changes in the OBBA that will be used for calculation of ARC-CO payments ?

The ARC-CO guarantee level is increased to 90 percent of the calculated benchmark (BM) revenue (BM county yield x BM price), which is up from the previous 86 percent guarantee. The maximum ARC-CO payment cap is increased to 12 percent of the calculated BM revenue, which was previously at 10 percent. This combination means that ARC-CO payments will be initiated more frequently, and the maximum ARC-CO payment amounts per base acre will be significantly higher for most program crops.
 

• What are the new farm program payment limits under the OBBA ?

The payment limit for ARC-CO and PLC payments has been increased to $155,000 per eligible entity or individual, beginning with the 2025 program. This is up from the previous payment limit of $125,000. An inflation adjustment factor was also added, which could allow for small increases in future payment limits. Farm businesses that are set up as S corporations and LLC’s will now be treated similar to general partnerships as far as determining the number of individuals that are eligible for payment limits; however, no details have been released regarding the revised payment limit eligibility.
 

• Will the OBBA provisions be implemented retroactively for the 2025 crop year ?

Yes, since farmers had already selected their farm program choice when the OBBA was passed, they will automatically receive the higher of any PLC or ARC-CO payments for a given farm program crop for the 2025 crop year, which will be paid in October. This provision will only be in effect for the 2025 crop year.  
 

• Will farmers be able to increase crop base acres for 2026 ?

The OBBA allows for the addition of up to 30 million more farm program base acres, which will be allocated among eligible program crops. The added base acres will be for acres planted to farm program crops that are currently not eligible for farm program benefits. It is not anticipated that this will include the opportunity to change or update existing crop base acres. It is likely that the new crop base acres will be eligible for farm program benefits for the 2026 crop year; however, no announcement has been made in that regard. As of this writing, USDA has not announced the details for adding crop base acres.
 

• What are the enrollment dates for the 2026 farm program ?

USDA has not yet announced the sign-up dates for the 2026 farm program. It is anticipated that sign-up may not begin until after the crop base acre update has been completed, which means that farm program sign-up may be delayed until late Spring or early Summer. The delay in the 2026 farm program sign-up beyond the normal March 15 deadline can actually be a benefit for producers, as it allows them to have a better handle on 2026 crop production and anticipated 2026 market year average prices. This can be very helpful when deciding between PLC and ARC-CO as a farm program choice for 2026.
 

• Where can producers get more information on the 2026 farm program ?

County Farm Service Agency (FSA) offices will provide information on the 2026 farm program details and sign-up procedures, as soon as information becomes available. The FSA offices will also be providing information on crop base acre upgrades, as soon as those details are available. The updated 2026 crop reference prices used to calculate PLC payments, as well as the 2026 benchmark prices, yields, and revenues used to calculate ARC-CO payments and other farm program information are available on the FSA website at: https://www.fsa.usda.gov/resources/programs/arc-plc/program-data
 

• What are the increased crop insurance premium subsidies that are in place for 2026 ?

The federal premium subsidies for 80 and 85 percent crop insurance coverage will increase by 3 percent for 80 and 85 percent coverage levels, with an increase of 5 percent for other levels of crop insurance. The 2026 premium subsidy is increased to 80% in 2026 for both Supplemental Crop Option (SCO) and Enhanced Coverage Option (ECO) insurance cverage. In addition, both SCO and ECO are now available with either the PLC or ARC-CO farm program choice in 2026.
 

• What are the extra premium subsidies for beginning farmers with ten years or less of farming experience ?

The additional beginning farmer premium subsidies in 2026, beyond the regular crop insurance premium subsidies, are as follows:

• Year 1 and 2 farming --- additional 15% premium subsidy.
• Year 3 of farming --- additional 13% premium subsidy.
• Year 4 of farming --- additional 11% premium subsidy.
• Year 5-10 of farming --- additional 10% premium subsidy.

 

• How could the increased premium subsidies and other changes affect crop insurance decisions ?

The increased premium subsidies will allow most corn and soybean producers in the Midwest to utilize and an 80 or 85 percent revenue protection (RP) insurance policy with farm-level APH yields, and then supplement that policy with SCO and ECO insurance coverage utilizing county yields. This can provide for up to 95 percent insurance coverage in 2026 at a fairly reasonable cost.
 
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For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group
Phone --- (507) 381-7960; E-mail --- [email protected] 

As has been often said with farming “every year is different”, and many times decisions for the current crop year are based on what happened in the previous year or two. That could be the scenario in some cases with considering the Enhanced Coverage Option (ECO) and Supplemental Coverage Option (SCO) insurance coverage options for 2026. ECO insurance has been around for several years but was not considered on a widespread basis due to the relatively high premium rates for ECO coverage and limitations for SCO coverage. That scenario has now changed due to much lower premium rates and fewer limitations on SCO coverage. This makes SCO and ECO a much more viable crop insurance option as part of an overall risk management package in 2026. The deadline to enroll in crop insurance for corn and soybeans in 2026 is March 16. 

NEW FOR 2026 
The Supplemental Coverage Option (SCO) coverage will be available to producers that choose the Price Loss Coverage (PLC) and the Ag Risk Coverage (ARC-CO) farm program options for the 2026 crop year. So the farm program choice will not impact SCO insurance coverage decisions, as it did previously. SCO coverage allows producers to purchase additional county-level crop insurance coverage up to a maximum of 86 percent coverage in 2026, which will increase to 90 percent coverage in 2027. For example, a producer that purchases an 80% RP policy for corn or soybeans could purchase an additional 6% SCO coverage in 2026. 
The Enhanced Coverage Option (ECO) provides area-based insurance coverage from 86 percent up to 95 percent coverage, with producers having a choice between 90 or 95 percent ECO coverage. The purchase of ECO coverage is not linked to farm program enrollment. Producers can utilize both ECO and SCO together, in addition to their underlying RP, RPE, or YP insurance policy; however, farmers do not have to purchase SCO coverage in order to purchase ECO insurance. 
The Federal government has increased the premium subsidies for both SCO and ECO coverage for 2026, which should make premiums more reasonable for crop insurance coverage options that include these products. Both the 90 percent and 95 percent ECO insurance coverage options will have a premium subsidy of 80% in 2026, which is the as the premium subsidy for SCO coverage. (This is a correction from last week’s column dated 1-26-26.) In 2025, the ECO coverage options had a premium subsidy of 65%, which was increased from a 44 percent premium subsidy in 2024. This is in addition to the premium subsidy increases of 3-5 percent on most farm-level revenue protection (RP) crop insurance policies for 2026. The increase in the premium subsidy in 2025 resulted in 61.8 million acres being insured under ECO coverage in 2025, as compared to only 15.6 million acres under ECO policies in 2024. With the additional premium subsidy up to 80 percent for the 2026 crop year, we will likely see another increase in the number of corn and soybean acres insured by ECO coverage in 2026. 

HOW ECO AND SCO INSURANCE COVERAGE FUNCTION 
ECO and SCO are county revenue-based insurance products that are somewhat similar to the area risk protection crop insurance products. The calculations for ECO and SCO function very similarly to standard revenue protection (RP) insurance policies, utilizing the same crop insurance Spring price and harvest price as RP policies. The 2026 crop insurance Spring (base) price is based on the average Chicago Board of Trade (CBOT) prices for December corn futures and November soybean futures during the month of February. The Spring price estimates (as of 2-02-26) are near $4.50 per bushel for corn and $10.75 per bushel for soybeans. The harvest price for SCO and ECO coverage, as well as RP policies, is the average price of the same CBOT futures months during the month of October. Producers can utilize both ECO and SCO insurance coverage together, in addition to their underlying RP, RPE, or YP insurance policy. The biggest difference from most RP insurance policies is that ECO and SCO utilize county level average yields, rather than the farm-level APH yields that are used for RP policies. 
Based on the current Spring price estimates of $4.50 for corn and $10.75 for soybeans, crop producers can guarantee a market price of $3.83 per bushel for corn and $9.14 per bushel for soybeans with an 85% RP insurance policy. However, the market price guarantee increases to $4.28 per bushel for corn and $10.22 per bushel for soybeans, when adding SCO coverage and a 95% ECO policy, utilizing county yields, together with the underlying RP policy. These price guarantee estimates assume that the final 2026 harvest yield is the same as the APH yield on the farm., and the final 2026 county average yield is the same as the original county average yield. Any variations in the final harvest yield at the farm-level or with the county average yield, either up down from the farm-level APH yield or the original county average yield, will cause these price guarantees to vary. 
Due to the difference in county and farm-level yields, the calculations for SCO and ECO policies may function differently than the underlying RP policies. It is possible for a producer to collect on an individual RP policy, but not collect on a SCO or ECO policy, or vice versa. For example, a producer with an 85% RP policy may have a loss that qualifies for an insurance indemnity payment on a farm unit, while the county as a whole may not meet the threshold to qualify for a SCO or ECO payment. It could also be possible to collect a SCO or ECO payment for a county-level revenue loss, while not qualifying for a RP insurance indemnity payment at the individual farm-level. 

BOTTOM-LINE ON ECO AND SCO INSURANCE COVERAGE OPTIONS 
In 1989, corn and soybean producers could only insure up to 75 percent of their crop guarantee (APH yield times the Spring crop insurance price), and the federal premium subsidy was only 30 percent. This made crop insurance fairly expensive for the risk protection that was provided. In 2026, farmers can insure up to 85 percent of their crop insurance guarantee, based on trend-adjusted (TA) farm level yields. Premium subsidies are now 41 percent for 85 percent coverage, 51 percent for 80 percent coverage, and 60 percent for 75 percent coverage. In addition, farmers can now insure up to 90 or 95 percent of the insurance guarantee, utilizing county average crop yields above their farm-level coverage. Farmers can now carry 95 percent insurance coverage at a net premium cost that is likely lower than the premium cost for 75 percent coverage back in 1989. 
The added premium subsidies make the higher crop insurance coverage levels available through SCO and ECO policies much more affordable for 2026. The enhancements to SCO and ECO coverage allow farmers to reduce risk and insure a higher percentage of their expected 2026 crop production at a reasonable premium cost. Many crop insurance companies have combined SCO and ECO coverage with other private insurance buy-up policies to offer some very attractive insurance options for 2026. Utilizing SCO and ECO coverage, together with a sound Revenue Protection (RP) policy on individual farm yields, an provide an excellent risk management package. 
Farmers should contact their crop insurance agent for details, premium quotes, and spreadsheets on various crop insurance coverage options, including ECO and SCO. 
Kent Thiesse, Farm Management Analyst, has prepared an information sheet titled: “2026 Crop Insurance Decisions” that contains more details on SCO and ECO insurance coverage, along with tables showing SCO and ECO examples. To request a free copy of this information sheet, send an e-mail to: [email protected] 
Some other good crop insurance resources include: Ø U of Illinois FarmDoc website - https://farmdoc.illinois.edu/ Ø Kansas State University - https://agmanager.info/ Ø Iowa State University - https://www.extension.iastate.edu/agdm/# Ø USDA Risk Management Agency (RMA) --- https://www.rma.usda.gov/ 
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone - (507) 381-7960; E-mail - [email protected]

During the next few weeks, farm operators will be finalizing their crop insurance decisions for the 2026 crop year. March 16th is the deadline to purchase crop insurance for the 2026 crop year. The Spring base prices for corn and soybeans will be finalized on March 2, 2026, and should be similar to crop insurance base prices in 2025. There have been increases to federal premium subsidies and other enhancements for crop insurance coverage in 2026. This should provide for some favorable crop insurance options and guarantees for the 2026 crop year at reasonable premium costs. Linking a revenue protection (RP) insurance policy with farm yields together with SCO and ECO insurance coverage can provide enhanced risk protection, which can be especially important in this era of low commodity prices.
Producers have several crop insurance policy options to choose from, including yield-only (YP) and revenue protection (RP and RPE) policies, SCO and ECO policies, and other private insurance options. In recent years, most farm operators have chosen revenue protection (RP) insurance options, which provide a guaranteed gross revenue per acre (yield x price). This guarantee is based on yield history (APH) on a farm unit times the Spring (base) price, which is the average of the CBOT prices during the month of February for December corn futures and November soybean futures.
As of January 26, the 2026 crop insurance Spring price estimates in the Upper Midwest for YP, RP, and RPE policies were estimated near $4.55 per bushel for corn and near $10.80 per bushel for soybeans. The 2026 Spring prices will be finalized on March 2. The current 2026 Spring price estimates compare to recent base prices $4.70/bu. for corn and $10.54/bu. for soybeans in 2025; $4.66/bu. for corn and $11.55/bu. for soybeans in 2024; $5.91/bu. for corn and $13.76/bu. for soybeans in 2023; and $5.90/bu. for corn and $14.33/bu. for soybeans in 2022. The final 2026 crop revenue will be the actual fam yield times the crop insurance harvest price, which is the average CBOT prices during October for December corn futures and November soybean futures.
An analysis for the past nineteen years (2007-2025) shows that the final crop insurance harvest price for corn has been lower than the Spring base price in thirteen of the nineteen years, including a decrease of ($.48) per bushel in 2025. The corn harvest price was also lower from 2013-2019. That trend was reversed from 2020-2022, when the harvest price for corn rose above the Spring price by +$.11 per bushel in 2020 +$.79 in 2021, and by +$.96 in 2022, before declining in 2023, 2024, and 2025. The only other years that saw an increase in the harvest price compared to the Spring price were 2010, 2011 and 2012.
An analysis of the past nineteen years for soybeans, shows that the harvest price has increased in seven years (2007, 2009, 2010, 2012, 2016, 2020 and 2021) and decreased in eleven years (2008, 2011, 2014-2019, 2022, 2023, 2024 and 2025), while staying the same in 2013. The range has been from an increase of +$2.84 per bushel in 2012 to a decline of ($3.00) per bushel in 2008. In 2025, the harvest price was $10.35/bu., which was a decrease of ($.19) per bushel from the Spring price. The range of price variation for both corn and soybeans over the years highlights the importance of having a solid crop insurance policy in place for the 2026 crop year.
Another insurance option that usually has a lower premium than a typical RP policy with harvest price protection is a RPE (harvest price exclusion) policy. An RPE policy functions similarly to a standard RP policy except that the guarantees on RPE policies are fixed at the base price level and are not affected by harvest prices that exceed the base price. The revenue guarantee for standard RP policies is increased for final insurance calculations, if average CBOT prices during the month of October are higher than the February CBOT prices, which is what occurred for corn and soybeans in both 2020 and 2021, as well as for corn in 2022. The RPE option is not recommended to protect against losses due to large crop disasters, such as a drought or other disaster that affects a large portion of the Midwest, or other situations that could lead to price increases during the year.
SCO and ECO Insurance Coverage Improved for 2026
New for 2026 - The Supplemental Coverage Option (SCO) coverage will be available to producers that choose the Price Loss Coverage (PLC) and the Ag Risk Coverage (ARC-CO) farm program options for the 2026 crop year. The farm program choice will no longer impact the SCO insurance coverage decision, as it had in the past. SCO coverage allows producers to purchase additional county-level crop insurance coverage up to a maximum of 86 percent coverage in 2026, which will increase to 90 percent coverage in 2027. For example, a producer that purchases an 80% RP policy for corn or soybeans could purchase an additional 6% SCO coverage in 2026.
The Enhanced Coverage Option (ECO) provides area-based insurance coverage from 86 percent up to 95 percent coverage, with producers having a choice between 90 or 95 percent ECO coverage. The purchase of ECO coverage is not linked to farm program enrollment. Producers can utilize both ECO and SCO together, in addition to their underlying RP, RPE, or YP insurance policy. SCO and ECO are county revenue-based insurance products that utilize the same crop insurance Spring prices and harvest prices as RP insurance policies; however, the biggest difference is that SCO and ECO utilize county level average yields, rather than the farm-level APH yields. As a result, the SCO and ECO insurance policies may achieve different results than the underlying RP policy. County yields are not finalized until May in the year following harvest, so any indemnity payments for SCO and ECO coverage would not be paid until early June in the following year.
The Federal government has increased the premium subsidies for both SCO and ECO coverage for 2026, which should make premiums more reasonable for crop insurance coverage options that include these products. For 2026, the 90 percent ECO coverage will have a premium subsidy of 80%, similar to SCO coverage, and 95 percent ECO coverage will have a premium subsidy of 65%. The added premium subsidies make the higher crop insurance coverage levels more affordable for 2026. The enhancements to SCO and ECO coverage allow farmers to reduce risk and insure a higher percentage of their expected 2026 crop production at a reasonable premium cost. Many crop insurance companies have combined SCO and ECO coverage with other private insurance buy-up policies to offer some very attractive risk management insurance packages for 2026.
“Enterprise Units” and “Optional Units”
“Enterprise units” combine all acres of a crop in a given county into one crop insurance unit, while “optional units” allow producers to insure crops separately in each individual township section. “Enterprise units” usually have a lower premium cost (approx. $5.00-$10.00 per acre less) compared to “optional units” for comparable RP and RPE policies. Producers should be aware that “enterprise units” are based on larger coverage areas, and do not necessarily cover losses from isolated storms or crop damage that affect individual farm units, such as damage from hail, wind, or heavy rains that have occurred in recent years. It is important to understand the difference in insurance coverage and to analyze the yield risk on each individual farm unit, when determining if paying the extra premium for insurance coverage with “optional units” makes sense.
“Bottom-Line” on 2026 Crop Insurance Decisions
Producers have the option to purchase RP and RPE insurance coverage levels from 50% to 85%, and losses are paid if the final crop revenue falls below the revenue guarantee. Given the tighter margins for both corn and soybeans, there may be a tendency to reduce the level of crop insurance coverage for 2026. However, producers need to closely analyze their risk exposure for the 2026 crop year and adjust their crop insurance coverage accordingly. The enhancements to SCO and ECO insurance coverage allows crop producers to greatly improve their risk protection at a fairly reasonable cost. Crop insurance remains one of the best risk management tools that is available for farm operators to protect their investment in crop production.
A reputable crop insurance agent is the best source of information to find out more details about the various crop insurance products that are offered, to get premium quotes, and to help finalize 2026 crop insurance decisions. Kent Thiesse, Farm Management Analyst, has prepared an information sheet titled: “2026 Crop Insurance Decisions”. To receive a free copy, send an email to: [email protected]
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone --- (507) 381-7960; E-mail --- [email protected]

The multiple USDA reports that are typically released in January are often known as being a “market mover”, and it appears that 2026 will continue that trend. The World Supply and Demand Estimates (WASDE) report released on January 12th seems to have set a negative tone for corn and soybean markets in the early months of 2026. USDA made a significant increase in the final 2025 corn production estimate, based on increasing the final 2025 record national average corn yield and increasing the 2025 harvested corn acres by over 1 million acres. The fairly large increase in the total corn supply, together with only a minor increase in corn usage estimates, resulted in a notable increase in projected ending stocks for corn, compared to a month earlier. The WASDE report also made some adjustments to soybean supply and demand data that were also viewed as negative for grain markets. The initial market reaction following the release of the WASDE report was a significant decrease in both corn and soybean prices on the Chicago Board of Trade (CBOT). 
CORN 
The updated National Ag Statistics Service (NASS) Crop Production Report for 2025 that was released on January 12th estimated the final 2025 U.S. average corn yield at the record level of 186.5 bushels per acre, which was an increase of 0.5 bushels per acre from the November estimate. The 2025 corn yield surpasses previous record U.S. yields of 179.3 bushels per acre in 2024 and 177.3 bushels per acre in 2023. The USDA 2025 corn yield estimate surpassed national average yield projection of nearly all grain market analysts. The overall average yield estimate by the analysts was 184 bushels per acre. The USDA corn yield estimates in January were increased significantly in Minnesota, Nebraska, Wisconsin, and North Dakota, compared to the previous yield estimates in November, 2025. 
The NASS report showed Minnesota as having a record corn 2025 yield at 201 bushels per acre, compared to 174 bushels per acre in 2024 and surpassing the previous record yield of 195 bushels per acre in 2022. Iowa is projected to have a corn yield of 210 bushels per acre in 2025, compared to 211 bushels per acre in 2024. Other projected state average corn yields for 2025 compared to 2024 yields are Illinois at 214 bushels per acre, compared to 217 bushels per acre; Indiana at 204 bushels per acre (record), compared to 198 bushels per acre; Ohio at 185 bushels per acre, compared to 177 bushels per acre; Nebraska at 194 bushels per acre (record), compared to 188 bushels per acre; Wisconsin at 188 bushels per acre (record), compared to 174 bushels per acre; South Dakota at 171 bushels per acre (record), compared to 164 bushels per acre; and North Dakota at 158 bushels per acre (record), compared to 149 bushels per acre. 
The latest WASDE report listed the total 2025 U.S. corn production at the record level of just over 17 billion bushels, which was increased from 16.75 billion bushels in November. The projected 2025 U.S. corn production was up 14.3 percent from 14.89 billion bushels in 2024, and was also above 15.34 billion bushels in 2023. The latest USDA report put the total demand for corn usage in 2025-26 at just under 16.4 billion bushels, which is an 8.2 percent increase from the 2024-25 corn usage. USDA is projecting corn export levels to increase by 342 million bushels in 2025-26, along with increases of 746 million bushels in corn used for feed and 164 million bushels in corn processed into ethanol. 
USDA is estimating 2025-2026 U.S. corn ending stocks at nearly 2.23 billion bushels, which was an increase of 198 million bushels from the December WASDE report. The estimated 2025-26 ending stocks are 43.5 percent higher than the final carryover of 1.55 billion bushels in 2024-25, and the current projected ending stocks also substantially exceeds the carryover of 1.76 billion bushels in 2023-24. The 2025-26 corn stocks-to-use ratio is now estimated at the relatively high level of 13.6 percent, which compares to ratios of 10.3 percent in 2024-25, as well as 11.8 percent in 2023-24 and 9.9 percent in 2022-23. The projected 2025-26 ratio is comparable to the relatively high stocks-to-use ratios of 13.7 percent in 2019-20 and 14.6 percent in 2018-19. The large available corn supply could limit the potential for short-term rallies in the cash corn market or local basis improvement in the coming months. 
USDA is estimating the U.S average on-farm cash corn price for 2025-26 at $4.10 per bushel, which is an increase of $.10 per bushel from the December estimate. The market year average (MYA) corn and soybean price estimates for 2025-26 are the expected average farm-level prices for the 2025 crop from September 1, 2025, through August 31, 2026; however, the MYA price does not represent estimated price for either the 2025 or 2026 calendar year. The projected 2025-26 corn price compares to final MYA price of $4.24 for 2024-25, $4.55 per bushel in 2023-24, $6.54 per bushel in 2022-23 and $6.00 per bushel in 2021-22. The current projected MYA price still exceeds the national average corn prices of $3.57 per bushel for 2019-20, $3.61 per bushel for 2018-19, and $3.36 per bushel in 2017-18. 
SOYBEANS 
The latest NASS report projects the 2025 U.S. average soybean yield at the record level of 53 bushels per acre, which was the same as the November estimate. The 2025 yield compares to recent final U.S. average yields of 50.7 bushels per acre in 2024, 50.6 bushels per acre in 2023, and 49.6 bushels per acre in 2022. Total U.S. soybean production for 2025 is estimated at 4.262 billion bushels, which is a decrease of 112 million bushels from the 2024 production level. The recent WASDE report estimates soybean demand at 4.257 billion bushels for the 2025-26 marketing year, which is a decrease of 164 million bushels from 2024-25 soybean demand levels. Soybean crush levels are expected to increase by 125 million bushels in the current marketing year; however, while soybean exports are expected to decline by 307 million bushels from 2024-25 levels, and would be 125 million bushels below 2023-24 export levels. 
The latest WASDE report estimated U.S. soybean ending stocks for the 2025-26 marketing year at 350 million bushels, which is an increase of 60 million bushels from the December report. The projected 2024-25 soybean ending stocks would be an increase of 25 million bushels from the 2024-25 carryout level of 325 million bushels. The updated 2025-26 projected ending stocks compares to other recent year-end carryout levels of 342 million bushels in 2023-24, 264 million bushels in 2022-23, and 274 million bushels in 2021-22. Current carryover levels are still well below the ending stocks of 525 million bushels in 2019-20 and 913 million bushels in 2018-19. 
The soybean stocks-to-use ratio for 2025-26 is now estimated at 8.2 percent, which is an increase from the final ratio of 7.4 percent in 2024-25, and compares to ending ratios of 8.3 percent in 2023-24, and 6.1 percent in both 2022-23 and 2021-22. The projected 2025-26 ratio is still considerably lower than the very high soybean stocks-to-use ratios of 23 percent for 2018-19 and 13.3 percent for 2019-20. The increase in the 2025-26 estimated soybean supply may limit opportunities for some short-term rallies in cash soybean prices in the coming months, unless weather issues develop in South America, or this coming growing season with the 2026 U.S. soybean crop. 
USDA is projecting the U.S. average farm-level (MYA) soybean price for the 2025-2026 marketing year at $10.20 per bushel, which is a decrease of $.30 per bushel from the December estimate. The estimated 2025-26 average soybean price compares to the final soybean MYA prices of $10.00 per bushel in 2024-25, $12.40 per bushel in 2023-24, $14.20 per bushel in 2022-23 and $13.30 per bushel in 2021-22. The 2025-26 MYA price estimate would still be considerably higher than the MYA soybean prices of $8.57 per bushel in 2019-20 and $8.48 per bushel in 2018-19, which occurred during the last trade war with China. 
Bottom Line following the January WASDE Report 
Both corn and soybean market prices had a very negative market response following the release of the WASDE report on January 12, with corn decreasing by over 24 cents per bushel and soybean prices declining by about 14 cents per bushel on the Chicago Board of Trade (CBOT) following the report. The USDA Grain Stocks report on January 12 indicated that as of December 1 there were 8.7 billion bushels of corn stored on farms in the U.S., including 1.45 billion bushels in Iowa and 1.2 billion bushels in Minnesota. It is likely that a high percentage of the bushels stored on farms are not yet priced, which means that the price decline on January 12 resulted in a lost asset value on the stored corn inventory of over $2 billion. A farmer that had 1,000 acres of corn in 2025 that yielded 220 bushels per acre would have 220,000 bushels of corn. If that corn is stored on the farm and not priced, that farmer lost nearly $53,000 in reduced value on his corn inventory immediately following the January WASDE report. 
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone --- (507) 381-7960; E-mail --- [email protected] 

Many farm operations are coming off the second relatively poor profit year in 2025, especially crop producers in several areas. Some farmers had very small profit levels last year, while other producers had very poor results in 2025. In all cases, most farm operators continue to face very tight profit margins for crop production as we head into 2026. During these challenging farm financial times, it is good to plan ahead before meeting with an ag lender for renewal of a farm operating line of credit or for an annual review of the farm financial portfolio.
 
Following are some tips for farm operators to be more proactive, as they are preparing for an annual meeting with their ag lender:
 
Prepare an up-to-date 2025 year-end farm balance sheet (as of 12-31-25 or 1-01-26).
Preparation of an accurate and up-to-date year-end balance sheet is critical to the loan renewal process for any farm operation. Updating the previous year’s balance sheet with current year-end numbers can help expedite the process. If the farm operation is a sole proprietorship, most ag lenders will also want personal asset and liability data included. If it is a partnership or family corporation, most ag lenders will also require personal balance sheets from all partners.
 
A good year-end balance sheet will include:
• List of accounts receivable as of 12-31-25, which includes whom the money is due from, the dollar amount, and the date it will be received. This includes deferred payments for grain sold in 2025, as well as potential Farmer Bridge Assistance payments, SDRP payments, etc.
• List of accounts payable as of 12-31-25, listing who the money is owed to, the dollar amount, and when payment will be due. Be sure to include any items listed as current assets where payment is still due, as well as final 2025 land rental payments that were still due as 12-31-25.
• List of 2026 prepaid expenses for both crops and livestock as of 12-31-25, which details the input, amount of the input, and the amount that was prepaid. This is for items where payment has occurred.
• Grain and livestock inventory list as of 12-31-25. The grain inventory should include total bushels of each crop, bushels that are forward priced (date and price for each sale), and any sales plans for the remaining bushels. Livestock inventory should include the number, weight, and any sales information on market or feeder livestock. An updated list and estimated value of breeding livestock should be included as an intermediate asset rather than a current asset. 
• Marketing Assistance Loans (MAL’s) on 2025 grain that were taken prior to 1-01-26, listing the bushel amount, MAL loan rate, MAL interest rate, MAL loan maturity date, and sales plans for MAL grain.
• Review the list of farm machinery and equipment, buildings and facilities, and other capital assets, removing any assets that have been sold or removed, and adding any assets that were purchased or acquired during 2025. Farm machinery values should be adjusted to represent current market values.
• Add any land or other long-term assets that were added in 2025 and adjust asset values as necessary (may want to review this with an ag lender).
• List of all other loans and creditors as of 12-31-25, listing the principal balance, interest rate, payment amount, and payment dates. Be sure to include short-term creditors for crop and livestock inputs, loans with family members, and MAL loans through FSA offices.
 
Prepare a 2025 year-end income and expense statement as of 12-31-25.
The year-end income statement from the previous year should be based on actual sales of grain and livestock during 2025, which will likely include some 2024 inventory that existed at the beginning of the year, as well as any 2025 grain or livestock that was sold during the year. The 2025 expenses would include any accounts payable from the beginning of the year balance sheet that were paid in 2025 and any 2026 prepaid expenses that were paid in 2025, in addition to the other crop and livestock expenses that were paid throughout the year. A preliminary 2025 federal tax return is a good resource to prepare an income statement. 
 
Prepare a budget-to-actual summary for the previous year (as of 12-31-25).
Once the 2025 income and expense statement has been finalized, and accrual adjustments are made based on the year-end balance sheet, it always good to review the actual year-end financial analysis compared to the budgeted cash flow analysis that was prepared at the beginning of the year. Pay attention to the big differences that exist in crop and livestock income and the various expense items, as well as determine explanations for those differences. Analyze for any potential adjustments that are needed for 2026.
 
Prepare a preliminary 2026 budget and cash flow analysis.
Preparing an accurate and complete budget and cash flow analysis for 2026 is a very important part of the loan renewal process and can assist with grain marketing decisions for the 2026 crop year. A high-quality cash flow analysis will likely include:
• Planned crop and livestock production for the year, including acres of various crops, anticipated production levels, and any current or planned sales of the 2026 production.
• A grain and livestock marketing plan that includes a list of the amount sold, the contracted price, and the date to be delivered, as well as plans for remaining unpriced grain and livestock inventories.
• A list of planned crop and livestock inputs for 2026, including the contracted or planned price of the inputs and when the expense will be incurred.
• A detailed list of rented farm land for 2026, which includes the name of the farm owner, acres rented, amount of rent (including flexible lease details), and dates when rent payments are due.
• Include income received for accounts receivable on the year-end balance sheet, and account for the payment of expenses for the listed accounts payable at the beginning of the year.
• Include any other farm income (custom work, etc.) and non-farm expenses (family living, personal loans, etc.) that must be accounted for in the cash flow analysis for the farm.
• Provide details of planned 2026 crop insurance coverage, such as updated APH yields, percentage coverage, enterprise versus optional units, and the addition of hail or wind insurance. (Your ag lender may be a good resource for these decisions.)
• Provide a copy of FSA farm program information listing the crop base acres and FSA program yield for each farm unit. Discuss the 2026 farm program choice with your ag lender.
• Include any planned changes or adjustments in the farming operation for 2026 in the cash flow analysis, including farm machinery purchases or sales, adding or selling land or other assets, and any other changes to the farm business, as well as any changes in personal assets or liabilities.
• Include likely Farmer Bridge Assistance payments expected for late February, as well as potential “top-up” 2023 and 2024 SDRP payments likely to occur later this year. Potential 2025 PLC or ARC-CO payment estimates for corn, soybeans, or wheat could also be included; however, be sure to use realistic market year average (MYA) price estimates, and make sure that you are using the correct payment calculation formula for accurate projections.  
 
It is best to include all partners and family members that are part of the farm operation with the preparation of relevant financial information and in the renewal process with an ag lender. It is important for all key players to be “on the same page” with financial decisions affecting the farm business. It is very important to be trustworthy and honest in preparing and sharing financial information with an ag lender to help assure confidence in the accuracy of the financial data. View an ag lender as an informal partner in developing farm business strategies, as a good ag lender can be a valuable resource in making management decisions. Farm operators should expect their ag lenders to be well prepared, trustworthy and honest in financial dealings. Most ag lenders are part of the local community and want to see farmers have financial success, which is in the best interest of both the farm business and the ag lending institution.
Note - For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions
Phone - (507) 381-7960; E-mail - [email protected] 

At the end of December, USDA announced the payment rates for the various crops that are included in the “Farmer Bridge Assistance” (FBA) program. A total of $12 billion was allocated for the FBA program to provide economic assistance payments to producers of certain crops to offset low prices and poor profit margins for the 2025 crop year, as well as the market price impacts from tariffs on export markets for certain crops in the past year. Of that total, $11 billion of the payments will be paid to producers of traditional farm program Title I crops, which includes corn, soybeans, wheat, cotton, and rice. The remaining $1 billion will be held back for economic assistance for specialty crop producers.
 
FBA payments will be based on the 2025 planted acres of eligible crops, as reported to local Farm Service Agency (FSA) offices on or before December 19, 2025. Any prevent plant acres in 2025 are not eligible for the FBA payments. The payment amounts for each crop were based on the national average yield times the projected 2025-26 market year average (MYA) price in the December 9, 2025 WASDE report, minus the 2025 average production cost for a commodity, based on USDA Economic Research Service (ERS) data. The MYA prices in the December WASDE report were $4.00 per bushel for corn, $10.50 per bushel for soybeans, and $5.50 per bushel for wheat.
 
Following are the FBA economic assistance payment rates that were announced foe some of the most common crops:

• Corn - $44.36 per acre 
• Soybeans -  $30.88 per acre
• Wheat - $39.35 per acre
• Oats - $81.75 per acre      
• Barley - $20.51 per acre
• Peas - $19.60 per acre
• Sorghum - $48.11 per acre
• Cotton - $117.35 per acre
• Rice - $132.89 per acre
• Peanuts - $55.65per acre

FBA payment rates were also announced for canola, chickpeas, flax, mustard, safflower, sesame, and sunflower. No details have been released on how the $1 billion in specialty crop funds will be allocated.
 
Applications for the FBA program will be made through local Farm Service Agency (FSA) offices. FSA will provide a pre-filled FBA application form to producers that will list the 2025 crop acreage and other pertinent information. Producers will then need verify the information and sign the application form. The pre-filled application forms should be available at FSA offices by the week of February 23. Distribution of the FBA payments is expected to begin by February 28.
 
The payment limit for the FBA payments will be $155,000 per eligible person or legal entity. There will not be higher payment limits based on having 75 percent of taxable income received from farming enterprises, similar to some previous FSA programs. Entities such as corporations, LLC’s, S corporations, and trusts will be limited to one payment limit of $155,000. Any person or legal entity with an adjusted gross income (AGI) exceeding $900,000, based on FSA criteria, will not be eligible to receive any FBA payments.
 
Farmers seeking more information on the “Farmer Bridge Payments” can contact their local FSA office. For more information on the FBA program requirements and payment rates can go to the USDA FBA website at:
https://www.fsa.usda.gov/resources/programs/farmer-bridge-assistance-fba-program
Following are some common questions regarding the Farmer Bridge Assistance (FBA) Payments:
Why are the FBA payments needed ?
Depending on the final 2025 crop yield, the typical Midwest crop producer probably has a breakeven market price of $4.50 to $5.25 per bushel for the 2025 corn crop to cover all production expenses (not including any profit). The 2025 breakeven price for most farmers is likely $10.50 to $11.50 per bushel for soybeans, and over $6.00 per bushel for wheat. As was mentioned earlier, USDA is currently estimating the 2025-26 MYA prices at $4.00 per bushel for corn, $10.50 per bushel for soybeans, and $5.00 per bushel for wheat, which are all well below breakeven levels for many producers. The USDA Economic Research Service (ERS) is estimating that based on the average crop revenue (est. national average yield x projected MYA price) minus the average 2025 cost of production (farm input and overhead expenses), the average farmer will have the following estimated negative profit margins for 2025:

• Corn - Minus ($169) per acre
• Soybeans - Minus ($114) per acre
• Wheat - Minus ($112) per acre

 
Based on these estimates and the listed FBA payment rates, the FBA payments will cover approximately 26 percent of the estimated shortfall for corn, 27 percent of the estimated shortfall for soybeans, and 35 percent of the estimated shortfall for wheat.
 
Are the payment amounts for the various crops equitable ?
Some Midwest crop producers have questioned the rather high per acre payment amounts for some of the crops typically raised in Southern States, such as FBA payment rates of $132.89 per acre for rice, $117.35 per acre for cotton, and $55.65 per acre for peanuts. Based on the USDA ERS economic data referenced earlier, the estimated 2025 negative profit margins are minus ($379) per acre for cotton, minus ($173) per acre for peanuts, and minus ($154) per acre for rice. Based on these estimates, the FBA payment rates account for approximately 31 percent of the shortfall for cotton and 32 percent of the shortfall for peanuts, which is similar to the percentage for wheat; however, the FBA payment rate for rice would cover about 86 percent of the projected profit margin shortfall. It should be noted that one of the largest negative profit margins per acre in the Upper Midwest in 2025 was on sugar beets, which are not covered by the initial round of FBA payments.
 
It is estimated that $4.3 billion or 39 percent of the $11 billion total for FBA payments will be allocated for corn payments. Other estimated total payment amounts for various commodities include soybeans at just under $2.5 billion (22.5%), wheat at $1.9 billion (17.2%), cotton at $942 million (8.5%), and rice at $368 million (3.3%). The Midwest and Corn Belt States are projected to receive approximately $6.9 billion (64%) in total FBA payments, while Southern and Southwest States are projected to receive about $2.8 billion (26%), with the balance going to California and the Western States, as well as to the Northeastern States.
 
How many acres will be required to reach the $155,000 FBA payment limit ?
Following are examples of the estimated acres required to reach the $155,000 payment limit with various crop mixtures:

• 100% Corn ($44.36/A.)  = 3,494 acre
• 100% Soybeans ($30.88/A.)  = 5,019 acres
• 100% Wheat ($39.35/A.)  = 3,939 acres
• 2/3 Corn; 1/3 Soybeans (ave. $39.86/A.)  = 3,889 acres
• 1/2 Corn; 1/2 Soybeans (ave. $37.62/A.)  = 4,120 acres
• 1/3 Corn; 1/3 Soybeans; 1/3 Wheat (ave. $38.20/A.)  = 4,058 acres

 
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group
Phone - (507) 381-7960; E-mail - [email protected]

We have nearly completed the first year of the second Trump Administration, as well as having new leadership in the U.S. Senate, along with some changes in lead roles on the Congressional Agriculture Committees. In 2025, we saw the passage of a large reconciliation bill, the so-called “One Big Beautiful Bill”, the initiation of several ad-hoc farm program payments, and the lengthy shutdown of the federal government in October and early November. We also had several actions implemented by the Trump Administration in 2025 that had an impact on farmers and the agriculture industry. As we look ahead to 2026, there are many key issues and possible policy initiatives that could potentially affect the agriculture industry. There is not total agreement among ag leaders and members of Congress regarding some of the policy initiatives that are being considered.
The leadership of the U.S. Senate and House of Representatives, as well as key Congressional Committees such as the House and Senate Agriculture Committees, will have a major influence on future agriculture and energy issues. Republican Senator John Thune from South Dakota, who has strong ties to agriculture and energy policy, is the current leader of the U.S. Senate. Arkansas Senator John Bozeman is the Chair of the U.S. Senate Ag Committee, and Minnesota Senator Amy Klobuchar is in the Democratic leadership role as the Ranking Member on the Ag Committee. Republican Congressman G.T. Thompson from Georgia will continue the Chair the U.S. House Agriculture committee, and Minnesota Second District Congresswoman Angie Craig will likely continue as the lead Democrat on the Ag Committee. There are many other Senators and members of the U.S. House from the Upper Midwest that are seated on key Congressional committees that have an impact on the ag industry.
Following is some perspective on a few of the key agriculture and energy policy issues that may be under consideration during the next session of Congress, or by executive action from the Administration:
· TARIFFS AND TRADE POLICY --- During the first year of his second term, President Trump has shown the willingness to impose large additional tariffs on a variety of goods being imported into the United States from China, Mexico, Canada, and other countries. The administration later eased up on some of those tariffs, especially on certain goods and services used by the ag industry; however, the cost of many farm inputs and expenses increased in 2025 due to impacts that resulted from the added tariffs. Canada, Mexico, and China are the three largest trading partners for U.S. ag exports, including corn, soybeans, ethanol, pork, beef, and dairy products. The “United States-Mexico-Canada” (USMCA) trade agreement negotiated during the first Trump administration will be up for renewal in 2026. Farm groups and ag leaders are also hopeful that the administration can negotiate new trade agreements with other countries, in addition to the China trade deal that was negotiated this past Fall. Expanding U.S. exports is seen as a key component to improving farm profitability for many ag commodities.
· RENEWABLE FUELS AND ENERGY --- Many farm organizations are hoping that the Trump administration and Congress will take a stronger stance on further development of the renewable energy industry in the U.S. through implementation of year-round E-15 fuel blends, development of sustainable aviation fuel (SAF) and other incentives for renewable fuels. Ethanol and renewable diesel production have a major economic impact for farm operators, as well as for the overall rural economy in the Upper Midwest. Many ag leaders point to the development of SAF as a key growth opportunity for both the ethanol and renewable diesel industries in the future. However, the federal government has been somewhat slow to develop policies, as well as to provide the research and development funding, for the production of SAF fuel. U.S. farmers and the renewable fuel processing plants have remained somewhat confused regarding the policy direction for SAF fuel, along with the research and development of SAF fuel, as well as the overall future for the renewable energy industry in the U.S.
· FARM AND RURAL ECONOMY STRUGGLES CONTINUE --- Profit margins from crop production for many farmers were negative for the third year in a row in 2025, and profit prospects do not appear to be much better for 2026. The continued long-term weak farm profitability could put some farm operations on the brink of financial disaster. Crop production input costs and other farm expenses are expected increase in 2026, while land rental rates are expected to stay at fairly high levels in the coming year. Crop prices for corn, soybeans and wheat have remained below breakeven levels, and remain the lowest levels in the several years. For farm operators that experienced crop losses in either 2024 or 2025 due to weather issues, the financial situation is likely even more severe. Farmers have become quite dependent on short-term ad hoc government payments to offset the negative profit margins. During 2025, most crop producers received Economic Commodity Assistance Program (ECAP) payments, and some farmers also received Supplemental Disaster Relief Program (SDRP) payments for 2024 crop yield losses. Looking ahead to 2026, most crop producers will be receiving the recently announced Farmer Bridge Assistance (FBA) payments in late February, and there will likely be a “top-off” SDRP payment for 2023 and 2024 crop yield losses. There has been no announcement of any disaster assistance for 2025 crop yield reductions.
· IMPLEMENTATION OF THE “ONE BIG BEAUTIFUL ACT” (OBBA) --- The so-called “One Big Beautiful Bill” that Congress passed in 2025 contained many provisions that will improve the “safety net” for many Midwest crop producers, which began with the 2025 crop year. This included enhancements to the reference prices and crop insurance provisions that would normally be addressed in a Farm Bill. Most of the farm “safety net” provisions that were updated in the OBBA have been in place since the 2014 Farm Bill was enacted, and were continued through the 2024 year. The 2018 Farm Bill originally expired on September 30, 2023, and was extended last Fall for a second year in a row, with a new expiration date of September 30, 2026. In addition to the improvements in some crop “safety net” provisions, the OBBA also made some adjustments to the Nutrition Title of the Farm Bill (SNAP program, etc.). However, the OBBA did not address other Farm Bill Titles such as Conservation, Rural Development, Ag Research, or Trade Promotion.
· IMMIGRATION POLICIES --- Both production agriculture and the ag processing industry rely heavily on immigrant labor to maintain an adequate workforce, so actions in many parts of the U.S. by the federal Immigration and Customs Enforcement (ICE) agency has put some segments of the industry on edge in many communities. In the meantime, there has been very little action by either Congress or the Administration to address the workforce shortage that exists in portions of the agriculture industry. What is really needed is the development of an immigration policy that both secures the U.S. border and also allows needed immigration to satisfy labor shortages in some segments of the ag industry.
· IMPLICATIONS OF “MAKE AMERICA HEALTHY AGAIN” (MAHA) --- U.S. Secretary of Health and Human Services (HHS), Robert F. Kennedy, stirred some concern during 2025 with some potential proposals that were in the initial MAHA reports. While many of the recommendations in the report related to the agriculture industry were delayed, many farm and ag industry leaders are wondering what the impacts of MAHA might be in 2026 and beyond. Some of these recommendations could have a major impact on future farm production practices, as well as on the ag processing industry.
These are only a few of the potential ag policy issues that could affect farm families and rural businesses in 2026. There are also issues such as family health care access and costs, infrastructure needs in rural areas, assistance for beginning farmers, and other issues affecting rural families and communities. It will be interesting if Congress or the Administration addresses any of these issues in the coming year, which will feature the important nationwide Midterm Elections in November, 2026.
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone --- (507) 381-7960; E-mail --- [email protected]
​

Tariffs and the China Trade Deal
If there was a “2025 word of the year” in agriculture it would probably be “tariff”. A tariff is typically a tax paid at the border on products that are being imported from another country. This could be for products that are sold directly to consumers or manufacturing companies, or are products that are processed into other products for sale. Generally, the added cost of the tariffs gets added on to prices that businesses or consumers pay for the end products, or it increases the cost of materials and inputs for manufacturers and farmers. Tariffs placed by other countries on products being exported from the United States increases the cost of those products by purchasers in the foreign countries; however, it does not usually change the original price that the farmer or producer of the product receives. If foreign tariffs are too high, it can discourage foreign buyers from purchasing U.S. products.
Earlier this year, President Trump announced increased tariffs on a variety of goods being imported into the U.S. from Canada, Mexico, and China; however, those added tariffs have been reduced or delayed on some products, following some trade concessions by the three countries. Three of the primary U.S. agriculture export products that could be impacted by retaliatory tariffs are soybeans, corn, and pork. This means that a potential trade war with China, Mexico, Canada, and other countries involving retaliatory tariffs on U.S. ag products could have major impact on farmers and the ag industry in the Midwest, where most of these products are raised. In recent years, slightly over 40 percent of U.S. soybeans have been exported, along with about 20 percent of the corn and 25 percent pork produced in the U.S.
After months of uncertainty, a new U.S. trade deal with China announced in late October provided some stability and certainty to the soybean market. Soybean market prices had struggled for most of 2025 due to a lack of soybean export sales commitments to China and other countries, as well as a fairly large 2025 U.S. soybean crop being projected by USDA. China committed to purchase 12 million metric tons, or 441 million bushels, of U.S. soybeans in the current 2025-26 marketing year, as well as a minimum of 918 million bushels annually for the following three years. The proposed three-year Chinese soybean purchases would bring the export level of nearly back to the 2023-24 U.S. soybean exports to China of 992 million bushels. USDA also announced commitments of soybean sales totaling of almost 700 million bushels, of U.S. soybeans to other countries in the coming year, mainly to countries from southeast Asia.
 
Low grain prices and tight profit margins in 2025
For the third year in a row, most Midwest crop producers struggled with low grain prices and poor profit margins. The 2025 “new crop” corn prices in the upper Midwest have not offered many marketing opportunities during the entire year. The “new crop” corn prices in Southern Minnesota started the year near $4.10 per bushel and spent much the first six months between $4.00 and $4.25 per bushel. Since mid-Summer, local corn prices have remained below $4,00 per bushel at most local grain markets, with basis levels near $.50 per bushel below Chicago Board of Trade (CBOT) prices. Basis levels in North and South Dakota, as well as in western Minnesota, have been wider yet, resulting in even lower local corn price levels. Many crop producers likely had corn breakeven costs of $4.75-$5.25 per bushel for the 2025 crop year at average corn yields on cash rented land. As a result, most farmers have not able to “lock-in” a forward price at a profitable level on their 2025 corn crop. USDA is currently estimating an average “on-farm” corn price of $4.00 per bushel for the 2025-26 marketing year, which ends on August 31, 2026.
The 2025 “new crop” soybean price in southern Minnesota started the year near $9.50 per bushel, and spent most of the year between $9.25 to $9.75 per bushel, until late October. Soybean prices have improved by about $1.00 per bushel following the announcement of the new trade agreement with China, but have declined again by early December. Some farmers were not able to benefit from the improved soybean prices, as a result of having already sold their 2025 soybean crop following harvest for needed cash flow purposes. The 2025 cost of production for soybeans on cash rented land is likely near $10.75 to $11.50 per bushel at average yields for many producers. USDA is currently estimating an average “on-farm” soybean price of $10.50 per bushel for the 2025-26 marketing year; however, local soybean prices in many portions of the Upper Midwest have trailed that level in the past few weeks.
 
High Level of ad-hoc government farm program payments in 2025
Government farm program payments played a significant role in cash receipt levels for many crop producers in 2025. USDA estimates that approximately $40.5 billion in direct government payments will be paid to farmers in 2025, which would be an increase of 300 percent from $9.6 billion in 2024. The 2025 estimated government payments would represent nearly 25 percent of the projected total U.S. net farm income for the year. The 2025 payment level would be the second highest level in the past few decades, trailing only the $46 billion that was paid out in 2020. The large federal government farm program payments in 2025 were the result of one-time 2024 economic assistance (ECAP) payments, 2023 and 2024 disaster assistance (SDRP) payments, and large 2024 regular farm program payments (ARC-CO) for corn and soybeans in some areas due to very low crop yields in 2024. There were also the regular CRP, dairy margin coverage, and other traditional government payments that some farmers received. Recently, USDA announced an additional $12 billion in payments that will be allocated through the “Farmer Bridge assistance” program to offset low profit margins for crop production in 2025.
 
Passage of the “One Big Beautiful Bill”
The so-called “One Big Beautiful Bill” that Congress passed this past Summer contained some provisions that will enhance the “safety net” for many Midwest crop producers, beginning with the current 2025 crop year. This included updates to many of the reference price and crop insurance provisions that are normally addressed when a new Farm Bill is written. Most of the farm “safety net” provisions that were updated in the legislation have been in place since the 2014 Farm Bill and were continued in the 2018 Farm Bill until this year. For 2025 and the next five years, the statutory or minimum reference prices that determine potential farm program payments were increased from $3.70 to $4.10 per bushel for corn, from $8.40 to $10.00 per bushel for soybeans, and from $5.50 to $6.35 per bushel for wheat, with the ability to be increased on a year-to-year basis. For the 2025 and 2026 crop years, the reference prices are $4.42 per bushel for corn, $10.71 per bushel for soybeans, and $6.35 per bushel for wheat. For the current 2025 crop year only, eligible producers will receive the higher of any potential PLC or ARC-CO payments, regardless of which program they were enrolled in. Any potential payments will be paid in October, 2026.
                   
Record beef cattle prices in 2025
From a profitability standpoint, 2025 was more kind to livestock producers than it was to crop producers. Together with the large level of government farm program payments in 2025, the total cash receipts from livestock production in 2025 was largely responsible for the improved 2025 overall U.S. farm income projections released by USDA. Total 2025 livestock receipts in the U.S. are estimated at near $239.8 billion and are expected to increase by $30.6 billion or 11.2 percent from a year earlier. Receipts from cattle sales in 2025 showed the largest increase, with total receipts expected to increase by $17.5 billion or 16 percent, compared to a year earlier, reflecting the record cattle prices this year. Other 2025 increases in cash receipts compared to 2024 included hogs with an increase of $2.6 billion or 9.5 percent, turkeys at $1.1 billion, and chicken and eggs at $10 billion. Receipts from milk and dairy products is expected to decline slightly in 2025 compared to a year earlier.
 
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group
Phone - (507) 381-7960; E-mail - [email protected] 

On December 8, U.S. Secretary of Agriculture Brooke Rollins announced that $12 billion will be made available for the initiation of the long anticipated “Farmer Bridge Assistance” (FBA) program. The FBA program will provide economic assistance payments to producers of certain crops to offset low prices and poor profit margins for the 2025 crop year, as well as the market price impacts from tariffs on export markets for certain crops in the past year. Full details of the FBA payment calculations have not yet been announced by USDA; however, it appears that many aspects of the FBA payments will be very similar to the Economic Community Assistance Program (ECAP) that was implemented earlier this year for losses from the 2024 crop year. 
Following is a brief summary of some of the known details and potential calculations for the likely FBA 
economic assistance payments: 
• Eligible commodities - Of the $12 billion in total, $11 billion of the payments will be paid to the traditional farm program commodities, which includes corn, soybeans, wheat, grain sorghum, barley, oats, cotton, dry peas, large chickpeas, peanuts, rice small chickpeas, and other oilseeds. The remaining $1 billion will be held back for economic assistance for specialty crop producers. No details have been released on how the specialty crop funds will be allocated. 
• Eligible acres - FBA payments will be based on the 2025 planted acres of eligible crops, as reported to local Farm Service Agency (FSA) offices. Farmers that have not reported their 2025 crop acres to their FSA office need to do so by December 19 in order to be eligible for the FBA payments. 
• Payment timing - The specific payment details, including the payment levels for each crop, will be announced by late December of 2025, with program enrollment at FSA offices to follow. The FBA payments are expected to be distributed by late February of 2026. 
• Payment formula - The exact payment formula has not been announced; however, it was stated that the FBA payments will be calculated using a uniform formula that is based on 2025 planted acres of eligible crops. This sounds very similar to the formula for the ECAP payments, which was based on 2024 planted acres. ECAP payments were calculated by taking the projected revenue, which was the 10-year average yield times the projected 2024-25 market year average (MYA) price in the December WASDE report, minus the 2024 average production cost for a commodity, based on USDA Economic Research Service (ERS) data. The recent WASDE Report on December 9 listed the 2025 expected MYA prices at $4.00/bu. for corn ($4.10/bu. In 2024); $10.50/bu. for soybeans ($10.20/bu. In 2024); and $5.50/bu. for wheat ($5.60/bu. In 2024). The maximum ECAP payments for 2024 were $42.91 per acre for corn, $29.86 per acre for soybeans, and $30.69 per acre for wheat. Some analysts expect the 2025 FBA payments to be slightly higher than those levels. 
• Payment limits - The payment limit for the FBA payments will be $155,000 per eligible person or entity. There will not be higher payment limits based on having 75 percent of taxable income received from farming enterprises. 
Many farmers and ag lenders are currently beginning their crop budgets and cash flow planning for the 2026 crop year, and as a result are wondering what level of FBA payments to safely include as estimated income in 2026. While we will not know the exact FBA payment formula until late December, it appears that a safe FBA payment estimate for crop producers with corn, soybean, and wheat acres is probably near $25 to $30 per acre for acres planted to those crops in 2025. Farmers seeking more information on the “Farmer Bridge Payments” can contact their local FSA office. Any updates on the FBA requirements or payment rates will likely be announced on the USDA FSA website at: https://www.fsa.usda.gov/ 

Very Little Change In The December WASDE Report 
The monthly USDA WASDE report released on December 9 offered very few changes from the November WASDE report. The biggest change was a projected increase in corn export levels for the 2025-26 marketing year, which continues until August 31, 2026, along with a corresponding reduction in the estimated corn ending stocks for the year. There was no change from the November report in the 2025 corn and soybean production estimates, or in the soybean export and carryover levels for 2025-26. Overall, there was very little reaction to corn and soybean market prices on the Chicago Board of Trade (CBOT) following the release of the WASDE report. 
The December WASDE report maintained the 2025 national average corn yield of 186 bushels per acre and the 2025 U.S. harvested corn acreage of 90 million acres, resulting in an estimated record total U.S. corn production of 16.75 billion bushels for 2025. This compares to 14.89 billion bushels in 2024, the previous record of 15.34 billion bushels in 2023, and just under 13.7 billion bushels in 2022. Total corn usage for the 2025-26 marketing year is now estimated at 16.28 billion bushels, which is up 7.5 percent from 15.14 billion bushels in 2024-25. USDA is now projecting an increase of 342 million bushels in corn exports in 2025-26 compared to a year earlier, along with slight increases in the amount of corn used for feed and ethanol in the current marketing year, 
USDA updated the estimated 2025-2026 U.S. corn ending stocks to just under 2.03 billion bushels, which was lowered by 125 million bushels from the November estimate. This is still an increase of 32 percent from the carryover level of 1.53 billion bushels in 2024-25, and compares to 1.76 billion bushels in 2023-24, and 1.36 billion bushels in 2022-23. Based on current estimates, the corn stocks-to-use ratio would be at 12.5 percent for 2025-26, which compares to previous levels of 10.1 percent for 2024-25, 11.8 percent for 2023-24, and 9.9 percent for 2022-23. The continued higher level of corn supply could keep local basis levels fairly wide for future corn marketing opportunities in many portions of the Midwest. 
Even with the higher export projection, USDA left the estimated the U.S average on-farm cash corn price for the 2025-2026 marketing year at $4.00 per bushel, which was the same as the November report. The USDA marketing year average price estimate is the expected average farm-level price for the 2025 crop year from September 1, 2025, to August 31, 2026; however, this does not represent estimated prices for either the 2025 or 2026 calendar year. The projected 2025-26 average corn price of $4.00 per bushel would be the lowest since the 2019-20 price of $3.56 per bushel, and compares to other recent final average corn prices of $4.24 per bushel in 2024-25, $4.55 per bushel in 2023-24, and $6.54 per bushel in 2022-23. 
Total U.S. soybean production for 2025 is estimated at just over 4.25 billion bushels, which was the same as the November estimate. The anticipated production is based on harvested soybean acreage of 80.3 million acres and a final yield of 53 bushels per acre. Total soybean demand for 2025-26 is projected at 4.3 billion bushels, which represents a decrease from the usage level of just under 4.43 billion bushels in 2024-25. The projected soybean export level for 2025-26 is 1.63 billion bushels, which would be a decline of 240 million bushels compared to a year earlier. Interestingly, there was no change in projected total soybean exports from the November WASDE report, even with the recent China trade deal that detailed potential soybean exports in the coming year. 
The U.S. soybean ending stocks for 2025-26 are estimated at 290 million bushels, which was unchanged from the November WASDE report. This compares to recent soybean carryout levels of 316 million bushels in 2024-25, 342 million bushels in 2023-24, and 264 million bushels in 2022-23. The projected 2025-26 carryout level is still well below the very high ending stocks of 523 million bushels in 2019-20 and 913 million bushels in 2018-19. The soybean stocks-to-use ratio for 2025-26 is estimated at 6.7 percent, which is down from a ratio of 7.1 percent in 2024-25 and 7.3 percent in 2023-24, and is far lower than the ratio of 23 percent in 2018-19. The projected U.S. average farm-level soybean price for the 2025-26 marketing year is $10.50 per bushel, which is the same as the November estimate. The projected 2025-26 average price compares to recent price levels of $10.00 per bushel on 2024-25, $12.40 per bushel in 2023-24, and $14.20 per bushel in 2022-23. 
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone --- (507) 381-7960; E-mail --- [email protected]