Farmers Face Financial Storm
By Darius Spearman (africanelements)
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Farmers in Crisis
Farmers across the United States, especially those who supported Donald Trump, are facing serious financial problems. His administration’s policies, including tariffs and funding freezes, have hit them hard. Farmers in Arkansas are begging for emergency help. Many fear for their farms and their ability to make a living, even though they voted for Trump (alexiskoefoed.substack.com). One farmer said, “You are going to lose 25 to 30 percent of the farmers in this country if they don’t do something” (alexiskoefoed.substack.com). This financial stress affects all types of farmers, from small family farms to large operations. It includes dairy farmers, cattle ranchers, poultry producers, and those who grow row crops (alexiskoefoed.substack.com).
The situation is so bad that many farmers are struggling to keep their businesses afloat. They are making tough choices about how to cut costs without losing access to their land or hurting their productivity (terrainag.com). Farm bankruptcies went up by 55% between 2023 and 2024, and they are still rising in 2025 (agnetwest.com). This shows how serious the problem is for many farming communities.
Federal Funding Freeze
A major reason for the farmers’ crisis is the freeze on funding from USAID and USDA. USAID used to buy about $2 billion worth of U.S. farm products every year (moneywise.com). This agency has been effectively shut down, taking away a key market for American farmers. The defunding of USAID could make the U.S. farm recession worse. USAID has been a vital buyer of American grain, pulses, and oilseeds for decades (phantomecology.com).
In addition, USDA programs are also frozen. This has held up billions of dollars in loans and grants. These funds include money for renewable energy projects and new crops (highlandcountypress.com). Many farmers who invested in USDA-supported projects cannot get their money back because of this freeze. This is happening even though a federal judge ruled that the frozen funds must be released (alexiskoefoed.substack.com). The lack of federal support, combined with other policy changes, is putting a lot of pressure on farmers (agnetwest.com).
Impact of Funding Changes on Farm Income
Tariffs and Trade
The tariffs put in place by the Trump administration have made farmers’ financial problems even worse. When Trump placed tariffs on steel and aluminum in 2018, other countries fought back. They put their own tariffs on U.S. agricultural exports like soybeans (highlandcountypress.com). This led to fewer exports and lower prices for U.S. farmers. Farmers describe tariffs as “the ice cream on the cake of a perfect storm” (alexiskoefoed.substack.com). These tariffs make American crops unable to compete globally. The combination of tariffs and possible deportations of undocumented farm workers will create big economic challenges for farmers across the U.S. (moneywise.com).
These trade policies have a direct impact on farmers’ income. For example, lower crop prices and higher input costs have caused U.S. inflation-adjusted net farm income to drop significantly since 2022 (terrainag.com). The tariffs are a key part of the mix of issues, including immigration policy changes and frozen USDA funding, that are putting immense pressure on farmers (agnetwest.com).
Falling Commodity Prices
Farm commodity prices have dropped to their lowest point since 2020 (alexiskoefoed.substack.com). This is according to the Federal Reserve Bank of St. Louis. Farmers are getting squeezed, making it harder or even impossible for them to prepare their businesses for long-term success (alexiskoefoed.substack.com). The reality on the ground is that between 2022 and 2025, lower crop prices and higher input costs have caused U.S. inflation-adjusted net farm income to fall by $43 billion, or 26% (terrainag.com).
This drop in prices means farmers are earning less for their products, while the costs of running their farms continue to rise. This creates a difficult financial situation where many farmers are struggling to break even. The Federal Reserve Bank of Chicago reported that 4.3% of its district’s farm loan portfolio had “major or severe” repayment issues in late 2024 (agnetwest.com). This was the highest level since late 2020. The Kansas City Fed also saw a small increase in farm loan delinquencies as debt grew and the farm economy worsened (agnetwest.com).
Farm Bankruptcies on the Rise
Hope for the Future
Despite the current difficulties, some farmers still hope for long-term benefits from tariffs. However, they need immediate relief. A survey by Purdue University found that 70% of producers believe tariffs could eventually make U.S. agriculture stronger (alexiskoefoed.substack.com). This is if they can survive long enough. Farmers are asking for “ad hoc payments right now” to get through the current year (alexiskoefoed.substack.com). This is because proposed agricultural subsidies are not expected until 2026. These “ad hoc payments” are special federal supports given to farmers, different from regular, ongoing subsidies. They are meant to provide quick relief during tough times (agriculture.com).
The need for immediate support is critical. Many farmers have used up their working capital and are now facing difficult decisions (terrainag.com). Unless more ad hoc support payments are introduced this year, the number of farm bankruptcies is expected to keep rising (agriculture.com). This highlights the urgency of the situation for farmers across the nation.
Broader Economic Impact
The crisis in the farming sector has wider effects on the U.S. economy and food supply. If fewer acres are planted, the costs of raw materials will go up (alexiskoefoed.substack.com). This will then affect the entire food supply chain. If family farms fail, large corporations might take their place (alexiskoefoed.substack.com). This would reduce competition and keep prices high for consumers. Farmer sentiment is at nearly decade lows (phantomecology.com). There are growing worries about consolidation and debt. Historically, there have been increases in farmer suicide rates and foreclosures during similar periods of stress (phantomecology.com).
The financial strain on farmers is not just a rural issue; it impacts everyone. When farmers struggle, it can lead to higher grocery prices and less variety in our food supply. The economic challenges faced by farmers are complex. They include unpredictable tariffs, shifts in immigration policy, cuts to federal programs, and frozen USDA funding (agnetwest.com). These factors combine to create a difficult environment for farmers, leaving many without the support they need to thrive.
Understanding Ad Hoc Payments
Ad hoc payments are special, one-time federal supports given to farmers. They are different from regular, ongoing agricultural subsidies.
Farmers often request these payments for immediate relief during unexpected crises, such as severe economic hardship or natural disasters.
These payments are crucial when traditional subsidies are delayed or insufficient to address urgent financial needs.
Geographic Reach of the Crisis
While Arkansas farmers are highlighted, the crisis is widespread across the U.S. Farm bankruptcies are rising nationally (agnetwest.com). For example, the Federal Reserve Bank of Chicago reported that a significant portion of its district’s farm loan portfolio had repayment issues in late 2024 (agnetwest.com). This indicates a broad financial struggle. The Kansas City Fed also noted an increase in farm loan delinquencies (agnetwest.com). This shows that the problem is not limited to one area.
The impact varies by region and farm type. For instance, California, despite having many more residents than Iowa, has fewer farms and fewer bankruptcies so far this year (agriculture.com). This suggests that different states and types of farming operations are experiencing the crisis in unique ways. The overall trend, however, points to a worsening situation for farmers nationwide, regardless of their specific location or crop focus.
Labor Issues and Their Impact
The mention of potential deportations of undocumented farm workers adds another layer of complexity to the crisis. An estimated 42% of U.S. farm workers are undocumented (moneywise.com). If these workers are deported, it could lead to severe labor shortages. This would drive up prices for consumers and potentially leave essential goods in short supply (moneywise.com). The combination of tariffs and potential deportations will create significant economic challenges for farmers across the U.S. (moneywise.com).
Labor is a critical component of farming economics. A reduction in the available workforce directly impacts a farm’s ability to plant, harvest, and process crops. This can lead to decreased productivity and increased operational costs. Therefore, changes in immigration policy that affect the farm labor supply can compound the financial difficulties already faced by farmers, making it even harder for them to stay in business.
The Path Forward
Farmers are not asking for charity; they are fighting for survival. Without emergency aid before the spring planting season, Arkansas could lose a third of its farms (alexiskoefoed.substack.com). When farms disappear, everyone pays the price. The current situation is a mix of unpredictable tariffs, shifts in immigration policy, cuts to federal programs, and frozen USDA funding (agnetwest.com). This combination is putting immense pressure on farmers, leaving many without the support they need.
The path forward requires a clear understanding of the challenges and immediate action. Farmers need support now to prevent further bankruptcies and ensure the stability of the food supply chain. While some hope for long-term benefits from current policies, the immediate need for financial relief is undeniable. The future of farming in the U.S. depends on effective solutions that address both the short-term crisis and the long-term sustainability of agricultural operations.
ABOUT THE AUTHOR
Darius Spearman has been a professor of Black Studies at San Diego City College since 2007. He is the author of several books, including Between The Color Lines: A History of African Americans on the California Frontier Through 1890. You can visit Darius online at africanelements.org.
