Costs going higher in 2027

USDA’s latest Commodity Cost and Returns report shows production expenses are expected to climb for every major crop in 2026 as global energy and fertilizer market disruptions continue to ripple through agriculture. The report follows months of volatility tied to conflict involving Iran and concerns about shipping through the Strait of Hormuz. Higher fertilizer costs are adding pressure to already tight farm margins. The findings mirror a recent American Farm Bureau Federation survey in which 70 percent of farmers said they couldn’t afford all the fertilizer needed for the 2026 crop year. The outlook for 2027 offers little relief. USDA projects production costs will reach record highs for most major crops, driven by rising seed, chemical, labor, machinery, repair, and cash rent expenses. Rice is projected to have the highest production cost at $1,427 per acre, followed by peanuts at $1,248, cotton at $1,001, and corn at $952.