Tightening Margins and High Costs Signal Consolidation for Row-Crop Farms

Farmers are feeling the squeeze as input costs remain elevated and crop prices soften. A significant majority of agricultural economists (80%) fear this could lead to increased consolidation in the row-crop sector. This sentiment is captured in the April Ag Economists’ Monthly Monitor, a joint survey conducted by the University of Missouri and Farm Journal.

Net farm income is projected to plummet by nearly 25% this year, according to both USDA and economist forecasts. While the recent boom in farm income was an anomaly, this sharp decline could have significant consequences for the sector.

Michael Langemeier, associate director of the Center for Commercial Agriculture at Purdue University, warns of “ugly” budgets for 2024, potentially resembling or surpassing the difficult financial year of 2019.