Farm Bill Expiration Leaves Rural Programs In Uncertainty

The latest extension of the 2018 Farm Bill expired September 30, leaving Congress without a new long-term agriculture policy. The Farm Bill covers farm safety-net programs, conservation, crop insurance, food assistance, and other programs important to rural America. Crop insurance and SNAP benefits will continue, but some conservation, research, rural development, trade, and energy programs face funding uncertainty without congressional action. The more immediate concern is programs whose funding or authority has expired. Some farm programs, including commodity and dairy support measures, are set to expire December 31. Senate Agriculture Committee Chairman John Boozman says farmers should not expect an immediate disruption, noting USDA can take administrative steps to keep programs operating through the end of the year. Meanwhile, bipartisan negotiations are expected to continue during the congressional break. Iowa Farmers Union President Aaron Lehman (LAY-man) told We Are Iowa that the biggest casualty of the Farm Bill impasse is the stability farmers rely on.

Farm Bureau Calls For Relief From High Diesel Costs

American Farm Bureau Federation President Zippy Duvall is calling on President Trump to take steps to lower diesel prices as farmers face record-high fuel costs during harvest. In a letter to the president, Duvall asked for a temporary suspension of the federal highway diesel tax, which currently exceeds 24 cents per gallon. He says diesel is essential for running tractors, combines, and irrigation equipment, as well as transporting crops, livestock, and farm inputs. The national average on-highway diesel price has reached $6.38 per gallon, while farm diesel in the heart of the Corn Belt is approaching $6. Farm Bureau is also asking the administration to waive federal penalties for emergency use of dyed diesel on highways. Duvall says farmers cannot postpone harvest or simply stop using diesel when prices rise, making high fuel costs a significant challenge during one of the busiest times of year.

Judge Extends Pause On USDA Employee Relocations

A federal judge in California has extended a temporary pause on USDA employee relocations while he considers whether to block the moves indefinitely. U.S. District Judge Vince Chhabria (CHUB-ree-uh) extended the administrative stay through October 13. The pause affects deadlines for USDA employees who have received orders to relocate as part of the department’s reorganization. The USDA plan calls for relocating about 2,600 employees currently based in the Washington, D.C., area to agency hubs around the country. During a recent hearing, Chhabria questioned whether USDA has the authority to carry out the reorganizations without approval from congressional appropriations committees. USDA maintains it has legal authority to reorganize and says the changes are intended to deliver services more effectively. Federal employee unions challenging the plan argue the relocations could lead to significant employee losses and violate congressional restrictions. The judge is considering a preliminary injunction that could keep the relocations on hold while the case proceeds.

USDA Streamlines Rural Energy Program

USDA is changing the application process for the Rural Energy for America Program, or REAP, to simplify applications and protect taxpayer dollars. Under a final rule issued by USDA’s Rural Business Cooperative Service, applicants will have to complete and operate their energy projects before applying. That means producers and rural small businesses will need documented information showing actual energy savings, costs, and system performance. The rule also makes multi-location projects and certain technology applications ineligible. USDA says it will use a single national competition process to simplify administration and prioritize projects with verifiable results. The department also plans to launch an online application portal designed to reduce paperwork and shorten application and review times. Agriculture Secretary Brooke Rollins says the changes will restore integrity and stability to REAP. USDA says the rule also discourages solar and wind projects on cropland and seeks to prevent taxpayer-supported projects from using components from foreign adversaries.

Family Farms Account For 97 Percent Of U.S. Farms

Family farms continue to dominate U.S. agriculture, accounting for about 97 percent of all farms in 2024, according to USDA data. Small family farms, those with gross cash farm income below $350,000, made up about 86 percent of all farms. They operated 40 percent of U.S. agricultural land and produced 17 percent of the total value of farm production. Large-scale family farms, with at least $1 million in gross cash farm income, represented just five percent of farms but accounted for 33 percent of agricultural land and half of total production value. Midsize family farms represented another six percent of farms and accounted for 18 percent of both agricultural land and production value. Overall, family farms operated 91 percent of U.S. agricultural land and produced 85 percent of the nation’s agricultural output. Non-family farms represented three percent of farms and accounted for 14 percent of production value, down from 17 percent in 2023.

U.S. Hog Herd Remains Tight With Little Expansion Expected

The U.S. hog herd remains smaller than a year ago, with USDA’s September Hogs and Pigs report showing 74.3 million head as of September 1, down about two percent from last year. The breeding herd was estimated at 5.87 million head, down one percent and the smallest since 2013. The June-through-August pig crop also fell about one percent, while farrowings were down nearly three percent from a year earlier. USDA says the numbers point to little expansion potential through early 2027, but there is no evidence of widespread herd liquidation. Meanwhile, USDA lowered its pork export expectations for 2026 and 2027, citing softer global demand and increased competition from Canada and Brazil, particularly in Mexico, the largest foreign market for U.S. pork. Hog profitability remains positive, but higher corn prices are narrowing margins. Analysts say continued declines in hog prices could eventually pressure producers to reduce herd numbers further.

Tuesday Watch List

Markets

On Tuesday, the U.S. Census Bureau will release the August Trade Balance report at 7:30 a.m. CDT. There are no other major reports due out and traders will continue to watch for updates regarding the ongoing U.S. harvests as well as regional conflicts, while also positioning ahead of Friday's WASDE report.

Weather

Tuesday will be a very dry and largely warm day across the vast majority of the U.S. with high pressure in control. The tail end of a front in the Gulf is being monitored for tropical development this week, which is likely to move through the Southeast this weekend.