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  • Production, Price, and Profit Prospects for the 2027 Wheat Crop

    Production, Price, and Profit Prospects for the 2027 Wheat Crop

    Producers that grew winter wheat in 2026 were most likely glad to put the season behind them. Winter wheat acres planted in the U.S. were the lowest since 2020. With only 67 percent harvested (tied with 2023 as the lowest on record), wheat acres harvested were the lowest since the USDA began reporting in 1909.  The winter wheat yield of 47.0 bushels per acre was the lowest since 2015 (42.5 bushels). That resulted in a 990 million bushel winter wheat crop, the smallest since 1963. 

    However, wheat prices surged late in the growing season with Ukraine and Russia escalating attacks on shipping and port facilities in the Black Sea region. Even with a war extending past four years, that region still accounts for about 30% of global wheat exports. 

    Alternatively, the war with Iran has negative repercussions for producers planning for 2027. The restriction of shipping through the Strait of Hormuz has resulted in much higher fertilizer and fuel prices, and overall inflation continues to pressure all prices higher, squeezing profit margins even more. 

    Given the geopolitical situation and commodity and input price environment, let’s take an early season look at production, price, and profits for winter wheat. 

    Production. It is likely that U.S. winter wheat acres will increase in 2027. While wheat is not a major crop in every state in the South, the region as a whole accounts for about 20% of U.S. winter wheat production. Though the overall trend in wheat acres in the U.S. is on the decline, we tend to see an increase in acres when we see an increase in the season average farm price the year before. Moving from a $5.06 per bushel wheat price in 2025 to $6.20 in 2026 signals an increase in acres for 2027.

    The National Oceanic and Atmospheric Administration is also predicting more than a 90% chance that the region will face a very strong El Nino weather pattern this fall and winter. That means an increased likelihood of a wetter and colder winter across the South. Since 2000, every state has seen above average precipitation in El Nino winters (December/January/February) (Iowa Environmental Mesonet, 2026). The forecast temperature track of the current El Nino is the strongest since the winter of 2015/16 (Figure 1). The 2016 winter wheat yield is the highest on record.

    El Nino years also tend to produce a higher percentage of planted wheat harvested: 81% versus a 78% average since 2000. With an increase in acres and increased precipitation, winter wheat production prospects in 2027 look much improved from 2026.

    Price. As of September 4, 2026, the price for July 2027 winter wheat contracts is $7.53 per bushel for Chicago soft red winter wheat and $8.11 for Kansas City hard red winter wheat. That is up from the July 2026 contract closing prices of $6.31 for Chicago wheat and $6.64 for Kansas City wheat.   The current futures prices for both Chicago wheat and Kansas City wheat are  trading in the top third of their nearby price ranges going back over the last 10 years (Figure 2). 

    Profit. USDA’s Risk Management Agency sets the crop insurance base price for winter wheat using the average closing price of the Chicago and Kansas City July contracts from August 15 through September 14. This is important because higher base prices mean the revenue guarantee from crop insurance will provide a higher safety net for wheat in 2027.

    Costs, however, are going to be higher too. But costs for wheat compared to other crops are generally considerably less, as shown by USDA’s most recent forecast of costs of production for 2027 (Figure 3).  If the El Nino winter results in higher-than-average wheat yields, that will help lower next year’s breakeven price for wheat.

    Planting winter wheat can also provide cover crop benefits that promote soil health and benefit overall farm productivity, whether the crop is kept for harvest or not. And with wheat, the decision can be made in late winter whether to take to grain, harvest as forage or pasture, or  terminate and plant another crop when  we have more clarity around comparative profitability of all the farm’s enterprise possibilities.

    Figure 1. Sea Surface Temperature Deviations, El Nino Winters since 2000

    Figure 2.  Nearby Chicago Soft Red Winter Wheat Futures (Tuesday prices)

    Figure 3. 2027 Cost of Production Forecast–Total Operating Costs

    References

    Chicago Mercantile Exchange (CME). SRW Wheat Futures

    USDA, NASS. Quick Stats. Accessed online August 25, 2026, USDA – National Agricultural Statistics Service – Quick Stats.

    USDA, RMA. Price Discovery-Home. Accessed online August 11, 2026, RMA Price Discovery – Home.

    USDA, ERS. Commodity Costs and Returns. Accessed online August 11, 2026, Commodity Costs and Returns | Economic Research Service.

    Iowa Environmental Mesonet, Iowa State University. Monthly/Yearly Precip/Temperature Statistics by Year. Accessed August 10, 2026, 108. Accumulated Station Departures of Precip/GDD/SDD (Long Term Climate).

    NOAA, Climate Prediction Center. El Niño/Southern Oscillation (ENSO) Diagnostic Discussion, August 24, 2026, http://www.cpc.ncep.noaa.gov/products/analysis_monitoring/enso_advisory/

    Recommended citation format: Welch, Mark. “Production, Price, and Profit Prospects for the 2027 Wheat Crop.” Southern Ag Today 6(37.3). September 9, 2026. Permalink

  • Un-Scrambling Broiler Egg Set Data

    Un-Scrambling Broiler Egg Set Data

    You may have heard the saying, “You can’t unscramble an egg.” While that’s true, it may be possible to make sense of broiler egg set data and what it could indicate for future production. By examining trends in eggs set at U.S. hatcheries and comparing them with broiler market prices, we can gain insight into likely chick placements and poultry meat production several months ahead. For contract growers, these trends can provide clues about future flock placement scheduling.

    Understanding the Cycle

    From the time an egg is set in a hatchery until the bird is processed typically takes 9 to 12 weeks, depending on target market weight. Once eggs enter the hatchery, plans for placement and processing have largely been made.

    Today, more than 95 percent of U.S. broilers are produced under coordinated marketing systems in which poultry companies have already secured buyers long before eggs are set. These customers include grocery retailers, food distributors, and restaurant chains. Many agreements are long-term exclusive contracts at premium pricing to ensure a reliable product supply for the buyer. Some are structured on a “cost-plus” basis at a negotiated margin above cost, further insulating poultry companies from market risks. 

    This highly coordinated, closely connected supply chain contributes to industry stability and generally results in consistent bird placements for contract growers. As a result, flock schedules are often influenced more by company-specific marketing commitments, or by local circumstances than by short-term national market conditions.

    What Does the Composite Broiler Price Tell Us?

    The USDA Composite Broiler Price (CBP) is an average of reported negotiated prices for broiler products. While it does not represent the price received for most broilers sold, it serves as a useful indicator of overall market conditions.

    Historically, the CBP follows a somewhat seasonal pattern (Figure 1). Prices often strengthen during late spring and summer when chicken demand is highest and typically weaken later in the year. A shorter-lived increase often occurs during the holiday season.

    The 2020-2024 average and 2025 price pattern generally followed this trend. In contrast, 2026 prices have been much flatter throughout. Although prices remained below 2025 highs, they are significantly higher than the long-term average and demand has kept them relatively stable. One factor supporting chicken demand is the continued increase in competing protein prices, particularly beef, which has encouraged many consumers to choose lower-cost poultry products.

    What Are Egg Set Numbers Indicating?

    Compared with 2025, broiler egg sets have remained higher through most of 2026 (Figure 2). However, the gap has narrowed in recent weeks, and the number of eggs set has slowed compared with last year’s relatively flat trend.

    Several factors could explain this change. Lower market prices may be encouraging some production restraint. Another possibility is that hatchability has improved. The broiler industry has experienced hatchability challenges in recent years, requiring more eggs to be set to produce enough chicks. As hatchability improves, fewer eggs may be needed to achieve the same number of placements.

    Chick placements continue to run above 2025 levels (Figure 3), although recent differences have become much smaller. Overall placements in 2026 are averaging about 2.1 percent above last year, while July placements were only 0.7 percent higher than July 2025.

    Outlook for Growers

    At present, there is little evidence that contract growers should expect major changes in bird placements at the national level. Local conditions and individual company marketing strategies will continue to have the greatest influence on individual grower’s flock schedules.

    If chicken demand remains supported by high prices for competing proteins, egg set numbers could gradually increase later in the year, limited primarily by breeder hen inventories and chick availability. For now, industry trends appear generally consistent with normal seasonal patterns, suggesting relatively stable production and placement levels throughout the remainder of 2026.

    Figure 1. The USDA Composite Broiler Price represents an average of reported negotiated broiler prices. It does not necessarily reflect the actual price received for most broiler products sold.

    Figure 2. U.S. broiler egg sets remained above 2025 levels through most of 2026 but have recently moved closer to last year’s pace. Along with softening prices, improved hatchability may be reducing the number of eggs required to produce sufficient chicks. (USDA-NASS)

    Figure 3. Broiler chick placements in 2026 have averaged 2.1% above 2025 levels, although recent monthly differences have narrowed. July 2026 placements were only 0.7% higher than July 2025. (USDA-NASS)

    Recommended citation format: Brothers, Dennis. “Un-Scrambling Broiler Egg Set Data.” Southern Ag Today 6(37.2). September 8, 2026. Permalink

  • 2026 Mid-Year Farm Financial Condition Update

    2026 Mid-Year Farm Financial Condition Update

    2026 Mid-Year Farm Financial Condition Update

    Entering the second half of 2026, a new farm financial snapshot points to the continued financial challenges facing Southern agriculture, particularly among crop producers. The findings are based on a semi-annual survey conducted by the Mississippi State University Extension. Survey respondents included producers, professional farm managers, land appraisers, commercial bankers, Farm Credit System lenders, and USDA Farm Service Agency personnel operating in Mississippi, Arkansas, Louisiana, Tennessee, and neighboring states. 

    Figure 1: Agricultural Financial Indicators 

    Source: 2026 Mid-Year MSU Agricultural Credit & Farmland Survey. Data compiled and analyzed by the author.

    As shown in Figure 1, overall farm income remained weaker than during the same period last year. Approximately 46% of respondents reported lower farm income in their region, while 31% indicated that farm income was about the same as in the same period of 2025. Survey comments suggested that significantly higher fuel prices have further increased production costs. Consistent with these responses, the USDA Economic Research Service’s May 2026 Farm Income Forecast projects that lower cash receipts, combined with higher production costs, will place additional downward pressure on farm profitability. Only about 23% of respondents reported higher farm income in their region.

    Crop producers’ liquidity and solvency worsened again in 2026. 73% of respondents reported worsening liquidity and solvency for crop producers, while less than 10% of respondents reported improvements in these financial health measures. Several respondents noted that consecutive years of weak crop returns have substantially eroded producers’ financial positions. In contrast, livestock producers continued to experience improving liquidity and solvency for a second consecutive survey period, largely supported by stronger cattle prices.

    Figure 2: Agricultural Credit Conditions

    Source: 2026 Mid-Year MSU Agricultural Credit & Farmland Survey. Data compiled and analyzed by the author. 

    The survey also collected agricultural loan interest rates from a range of lenders, including commercial banks, the Farm Credit System, and insurance companies. Average interest rates for operating, intermediate-term, and farmland loans all remained around 7.5%, generally consistent with rates reported in the Federal Reserve Bank of Dallas’s quarterly agricultural credit survey. Interest rates were modestly higher than those reported in the survey conducted six months earlier.

    Agricultural credit conditions also weakened slightly during the first half of 2026. As shown in Figure 2, more than half of lenders reported that loan demand remained at about the same level as last year, while 33% of respondents reported lower loan demand. Respondents attributed the slight increase in loan demand observed in some regions to producers experiencing lower farm income. At the same time, most respondents indicated that loan repayment rates and loan renewals remained about the same as last year. However, among those reporting a change, more respondents reported worsening rather than improving conditions, suggesting growing cash flow stress among borrowers and increasing financial pressure across the region.

    Figure 3: Agricultural Land Value Expectation

    Source: 2026 Mid-Year MSU Agricultural Credit & Farmland Survey. Data compiled and analyzed by the author. 

    Despite increasing financial pressure on crop producers, farmland values remained resilient. Both cropland and pastureland values increased in 2026 compared to 2025. When asked about farmland value expectations for the next six months, respondents generally expected cropland and pastureland values to either remain stable or increase, as shown in Figure 3. While 18% and 9% of respondents expected increases in irrigated and non-irrigated cropland values, respectively, 44% anticipated another increase in pastureland values over the next six months. Survey comments suggest that continued demand from non-agricultural investors and alternative land uses has helped support farmland prices despite weaker farm profitability.

    Overall, although farmland values have remained strong, declining crop returns and rising production costs continue to place significant financial pressure on producers. Many respondents expressed frustration and concern about the deteriorating liquidity of crop operations, with several describing the first half of 2026 as one of the most challenging financial periods in recent years. Many emphasized the need for greater attention from policymakers to address the financial challenges facing the agricultural sector.

    Recommended citation format: Kim, Kevin. “2026 Mid-Year Farm Financial Condition Update.” Southern Ag Today 6(37.1). September 7, 2026. Permalink

  • Ad hoc and Farm Bill payments – Can these payments alleviate financial stress?

    Ad hoc and Farm Bill payments – Can these payments alleviate financial stress?

    Authors: Le Chen, Christopher N. Boyer, and S. Aaron Smith – University of Tennessee 

    Ad hoc payments have been used in times of disaster or unforeseen market forces to help producers. Historically, these payments were relatively small compared to the payments received by producers through the Farm Bill safety net, but recently ad hoc payments have been at record high levels. There have been several Southern Ag Today articles discussing a variety of topics about ad hoc payments such as the structures and the assistance they provide (Link, Link, Link). These payments are in addition to the Farm Bill safety net programs, Agricultural Risk Coverage (ARC) and Price Loss Coverage (PLC), that have primarily existed to stabilize farm income from various shocks.  Both types of programs are designed to support farm income and reduce financial stress. But do they actually help farmers stay current on their loans — and are they equally effective? A new study published in Agricultural Finance Review provides an analysis to jointly evaluate ad hoc payments (MFP and CFAP) and farm bill support programs (ARC and PLC) using actual payment timing and amounts.

    What We Found

    Using FSA payment data from 2015 to 2022, we examined how each payment type affected two key indicators of farm financial stress: total non-real estate farm debt and loan delinquency rates — both short-term (30–89 days past due) and longer-term (90 or more days past due). The results reveal important differences between programs:

    • ARC payments were associated with significant reductions in short-term loan delinquencies (30–89 days past due) and also increased total operating debt — suggesting that ARC payments improved farm liquidity and helped producers service their short-term obligations;
    • PLC payments reduced longer-term delinquencies (90 or more days past due) — indicating that PLC provides a more sustained form of financial support that helps producers avoid falling seriously behind on loans;
    • CFAP payments — the emergency COVID-19 assistance program — also significantly reduced short-term delinquencies, suggesting emergency payments can provide effective near-term financial relief when deployed quickly; and
    • MFP payments — the trade war relief program — actually increased total farm debt without reducing delinquencies, suggesting that MFP was less effective at alleviating financial stress and may have encouraged borrowing rather than debt repayment.

    What This Means for Farm Policy

    Not all government payments are created equal when it comes to reducing farm financial stress. Farm Bill safety net programs show evidence of reducing loan delinquencies while the study finds less evidence with ad hoc emergency programs. These findings are directly relevant to ongoing Farm Bill and agricultural policy discussions in 2026. With ARC and PLC recently reauthorized through the One Big Beautiful Bill with an additional 30 million base acres allocated nationwide, these payments are expected to provide more assistance in the future. These Farm Bill safety net programs appear to function as intended: providing income support that translates into improved loan performance and farm financial stability. As policymakers consider the future ad hoc payments (Link), these results are important when thinking about the intended purpose, design, and potential impacts of these ad hoc payments. 

    Recommended citation format: Chen, Le, Christopher N. Boyer, and S. Aaron Smith. “Ad hoc and Farm Bill payments – Can these payments alleviate financial stress?“ Southern Ag Today 6(36.5). September 4, 2026. Permalink

  • Feral Swine Eradication and Control Pilot Program Grant Applications

    Feral Swine Eradication and Control Pilot Program Grant Applications

    Authors: Chris Boyer and Aaron Smith – University of Tennessee 

    Feral hogs are one of the most destructive and costly wildlife threats facing American agriculture. Across the United States, feral swine populations have exploded from 18 states in 1982 to around 30 states in 2025, with population continuing to rise in many of those locations. The United States Department of Agriculture (USDA) Animal and Plant Health Inspection Service (APHIS) publishes county level population maps from 1982 to 2025 (USDA APHIS 2026). Figure 1 shows the USDA APHIS map for 2025 county level feral swine populations.

    Figure 1. USDA APHIS map for county level feral swine populations

    The damage they leave behind is staggering. The USDA estimates feral swine cause $2.5 billion in damage each year, but some estimate the annual damages to be nearly $3.4 billion (Link, link). Agriculture, mostly crops, are estimated to account for the $800 million of these damage (Link). Beyond crops, feral hogs spread disease to livestock, damage farm infrastructure like fences and roads needed for agricultural production, destroy recreational parks, and cause extensive environmental damage to wildlife habitats, water quality, and plant ecosystems.

    The 2018 Farm Bill established the Feral Swine Eradication and Control Pilot Program (FSCP), a $75 million initiative over a five-year period, to respond to the damage caused by feral swine to agriculture, property, ecosystems, and human and animal health. The program was implemented beginning in 2020 across select counties in ten states (Alabama, Arkansas, Florida, Georgia, Louisiana, Missouri, Mississippi, North Carolina, South Carolina, Oklahoma, and Texas). The program was a partnership between USDA’s Natural Resources Conservation Service, which focused on restoring lands damaged by feral hogs, and USDA’s Animal and Plant Health Inspection Service, which focused on removing feral hogs. Producers and landowners in participating counties were also eligible for grant funding to support hog control efforts. A one-year extension provided additional funding through Fiscal Year 2024. A full report of the projects implemented during this period is found online (Link).

    In July 2025, the One Bill Beautiful Bill (link) reinstated the FSCP allocating $105 million through fiscal year 2029. Currently, USDA is accepting applications for grant funding for partners in: Alabama, Arkansas, California, Florida, Georgia, Hawaii, Louisiana, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, Tennessee, and Texas.USDA have expanded the program from the original 10 states to include California, Hawaii, Missouri, and Tennessee. Partners selected to participate in the FSCP will provide landowner assistance for restoration and on-farm trapping efforts and provide related services, like training. The USDA is currently making available $35 million for grant-funded projects. Applications for these grants are open until 11:59 ET on September 21, 2026. For more information about funding opportunity and to apply, visit the notice of funding on Grants.gov.  

    Recommended citation format: Boyer, Chris, and Aaron Smith. “Feral Swine Eradication and Control Pilot Program Grant Applications.” Southern Ag Today 6(36.4). September 3, 2026. Permalink