Farm production costs were mixed last year but are up significantly in 2026. USDA Chief Economist Justin Benevidez provides the specifics from 2025.
Benevidez says the largest increase occurred in livestock and poultry production. However, the latest farm expenditure report shows crop farm spending dropped more than six-and-a-half percent.
The numbers for 2026 paint a much different story. Fertilizer is up year-over-year by five percent for ammonia and up to 37 percent for DAP. Since 2020, fuel and oil are up 32 percent, seeds, 18 percent, labor, 24 percent, and borrowing costs, 71 percent.
The Iran war, Chinese fertilizer export restrictions, and sanctions on Russian exports have all led to input cost spikes for U.S. farmers. USDA’s Economic Research Service projects that total per-acre production costs for all nine principal row crops will rise in 2026, adding more pressure to margins.
