The farm economy has changed significantly since the 2018 farm bill, with production costs rising faster than the prices farmers receive for their crops. A recent study from multiple farm groups shows that the prices-paid index for crop production inputs climbed more than 38 percent from July 2018 through July 2026, while the prices-received index for crop products increased about 24 percent. That widening gap means higher commodity prices don't translate into stronger farm margins. As input costs rise faster than product values, break-even prices increase and producers have less room to absorb market declines or unexpected expenses. Farmers and ranchers have also faced higher interest rates, rising equipment and farmland costs, and increasing farm debt. Higher land values have strengthened balance sheets, but they also raise costs for beginning farmers and those looking to expand. The changes demonstrate the need for a new farm bill that reflects today's higher costs, greater capital requirements, and increased risks.
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