U.S. soybean producers are closing out the 2025 harvest season under mounting financial strain as rising input costs and depressed market prices converge to create a third consecutive year of negative returns. While the Trump administration has identified elevated farm production expenses as a key policy priority, soybean growers continue to face the harshest economic conditions seen in decades.
When harvest began in September, November 2025 soybean futures were trading 25%–30% below levels seen at the same point in 2022. This steep decline in market revenue has sharply reduced farmers’ liquidity heading into the fall, limiting their ability to cover 2025 operating costs. The pressure is compounded by sustained inflation in land, machinery, seed, pesticide, and fertilizer costs — all essential inputs for soybean operations.
USDA projects total U.S. farm production expenses to reach $467.4 billion in 2025, a $12 billion increase from 2024. For soybean growers, five core inputs dominate the cost structure: land (28%), machinery and repairs (28%), seed (12%), pesticides (7%), and fertilizers (7%). Together, these categories account for 83% of annual per-acre production costs, according to USDA’s Economic Research Service (ERS). With expenses setting new highs, an analysis by the American Soybean Association (ASA) shows farmers are on track to lose an average of $89 per planted acre in 2025.
These losses would mark the third straight year of negative market returns — and potentially the beginning of a fourth. ERS expects 2026 input costs to remain elevated, and unless soybean revenues rebound significantly, the sector could face its longest period of sustained losses since the 1998–2002 reporting window.
Much of the current cost pressure can be traced back to the economic turbulence triggered by the COVID-19 pandemic. Input markets swung from record oversupply in 2020 — following massive prevented planting acreage in 2019 — to steep shortages and price spikes driven by supply chain disruptions and demand surges ahead of the 2021 season. Russia’s invasion of Ukraine in early 2022 intensified the situation, pushing fertilizer prices to historic highs due to sanctions and infrastructure damage in two of the world’s largest grain and oilseed producers. Russia remains the only nation that is a major exporter of all three key macronutrients used in fertilizer production.
Despite some easing from 2022 peaks, fertilizer and chemical prices remain well above pre-pandemic levels. Ongoing geopolitical conflicts, shifts in global trade flows, South American production growth, and persistent regulatory and transportation costs have kept input inflation “sticky,” preventing prices from returning to earlier norms.
Trade dynamics have also become a major contributor to rising production costs. The U.S. agricultural sector relies heavily on imported inputs, averaging $33 billion in import value annually. Tariffs imposed under the International Emergency Economic Powers Act (IEEPA) significantly altered cost structures, raising the effective price of fertilizers and pesticides and reducing import volumes — particularly for phosphate-based products. These supply constraints have kept domestic prices elevated.
A recent shift in policy could bring partial relief. Executive Order 14257, signed November 14, removes tariff duties on key fertilizers including diammonium phosphate (DAP), monoammonium phosphate (MAP), and potassium chloride (potash). Analysts expect this change to lower costs for the 2026 growing season, although farmers will not see immediate benefits in 2025.
Tariff impacts are particularly acute in pesticide markets. According to data from the North Dakota State University Agricultural Trade Monitor, the average tariff rate on agricultural inputs has jumped to 9.4%, compared to below 1% before IEEPA tariffs were enacted. Herbicides now face effective tariff rates near 16%, up from 5%–6%, while specialized pesticide imports from India — one of the world’s largest formulators — face effective tariff levels approaching 44%.
As soybean growers navigate rising costs, shrinking margins, and persistent market uncertainty, industry groups warn that meaningful relief will require both improved commodity prices and targeted policy adjustments. Without such changes, U.S. soybean producers may be heading toward the longest financial downturn the sector has experienced in more than two decades.
