Last week, the Trump administration reignited the legal fight over farm animal confinement laws by filing a new lawsuit challenging California’s egg-related regulations. The complaint argues that California’s laws are invalidated by the Egg Products Inspection Act (EPIA).
The DOJ claims California’s laws are preempted by the EPIA, a 1970 federal law ensuring the safety, quality, and labeling of eggs and egg products in interstate commerce. The EPIA authorizes USDA to set national standards for egg grading, sanitation, labeling, and packaging.
Challenged Provisions The lawsuit challenges Proposition 12, Proposition 2, and AB 1437. Prop 2 (2008) imposed space requirements for pregnant sows, veal calves, and laying hens. AB 1437 (2010) extended those standards to all eggs sold in California. Prop 12 (2018) further expanded these laws, regulating the production and sale of veal, egg, and pork products, requiring minimum space per animal, and banning the sale of products from animals confined more restrictively.
Standards Preemption
The DOJ relies on the EPIA’s preemption clause, which bars states from imposing additional or conflicting requirements. Under 21 U.S.C. § 1052(b), no state may impose standards “in addition to” or “different from” federal standards for egg “quality, condition, weight, quantity, or grade.”
DOJ argues California’s laws regulate egg “condition” and “quality,” defined by USDA regulations. DOJ points to AB 1437’s stated purpose—to protect consumer health—as an attempt to regulate inherent egg properties. It also cites Prop 12’s stated concern for health, safety, and foodborne illness risk.
Labeling Preemption DOJ also claims California’s regulations conflict with EPIA’s labeling preemption. California requires specific terms in shipping manifests and bans “cage free” labeling unless eggs meet its standards. DOJ argues these are labeling rules that differ from USDA’s.
Next Steps DOJ seeks a judgment declaring the California laws preempted and unenforceable. California will likely file a response, and a request for an injunction may follow.
For a more detailed analysis, click here for a NALC blog post.
Last summer, we wrote about a novel new concept for adding base acres to farms that had been proposed in the House Ag Committee-passed version of the 2024 Farm Bill (Farm, Food, and National Security Act of 2024). While that farm bill never came to fruition, the concept ultimately was adopted in the One Big Beautiful Bill(H.R. 1) that was recently signed into law by President Trump. The provision will allow up to 30 million additional base acres across the nation. Today’s article addresses some of the questions we’ve been asked, while providing an overview of the mechanics.
What will happen to my existing base acres? Nothing.
If this doesn’t affect my existing base acres, then what does it do? For those farms where recent plantings (described below) exceed the number of existing base acres on the farm, it allows the landowner to add additional base acres.
How does it work? There are essentially two simple components to the additional base provision that address acres planted to both covered and non-covered commodities:
Covered Commodities: If the average number of acres of covered commodities planted (or that were prevented from being planted) on a farm from 2019 through 2023 exceeds the number of existing base acres on the farm, you are eligible to add the difference as additional base acres.
Non-Covered Commodities: You can also add the number of acres of eligible non-covered commodities planted (or that were prevented from being planted) on a farm from 2019 through 2023 as additional base acres, so long as the total does not exceed 15% of the total acres on the farm.
If I get additional base acres, what crops will they be assigned to? They will be assigned in proportion to the covered commodities you planted from 2019 to 2023.
If I have “unassigned crop base” from previous changes to U.S. cotton policy, is it eligible to be included in the allocation of additional base acres? Yes.
Will I get these new base acres in time for the 2025 crop year (i.e., the crop I harvest in 2025)? No. The OBBB clearly stipulates that the new base will be in effect for the 2026 crop year.
What happens if USDA discovers there are more than 30 million acres of eligible new base? If the total number of eligible acres across the country exceeds 30 million acres, the Secretary would be required to apply a pro-rata, across-the-board (i.e., no progressive factoring) reduction to all farms to reduce the number of eligible acres to equal 30 million. For example, if USDA determines there are 60 million acres of eligible new base, everyone would see their additional base acres factored by 50% (i.e., 30 million divided by 60 million).
I’ve read that this concept wasn’t vetted and that it was designed to only help one region of the country. Is that true? No, that’s just political nonsense. Yes, the OBBB was a partisan process—reconciliation is notoriously partisan and has been repeatedly used by both political parties—but as we noted above, this provision went through a full committee mark-up last summer and has been thoroughly discussed/vetted over the last year. Finally, while this will certainly provide more benefit to areas like the Northern Plains where more covered commodities are being planted than in the past, we see no evidence that this was done to provide special benefit to any single region. In fact, it seems obvious to us that it was designed to address repeated complaints from all corners of the country to help landowners who—for whatever reason—have land that is not fully based.
Do I need to reach out to my county office? No. Congress is requiring USDA to go through a notification process with landowners. Further, producers already report their plantings to USDA’s Farm Service Agency (FSA), so in theory, FSA already has the data it needs to automate this process. With that said, the bill also provides an opportunity for a landowner to opt out of receiving additional base acres if they wish. Also, for purposes of assigning the new base to crops, for acreage that has been planted to a subsequent crop (other than a covered commodity produced under an established practice of double cropping), the owner gets to elect the covered commodity (but not both) to be used for that crop year in determining the 5-year average. In other words, there will be cases where the process cannot be completely automated.
Bottom line: this is a significant change from previous law that can only help producers (i.e., there is no downside). As always, the information above is provided for educational purposes only and is subject to change. USDA is the final authority on how this provision will be implemented, so be on the lookout for details in the weeks and months ahead.
During the farm bill legislative process in 2024, the House Agriculture Committee proposed increases to the Nonrecourse Marketing Assistance Loan (MAL) rates that were predominantly 10% higher than the existing rates for the major commodities shown in Table 1. A discussion of the 2024 House and Senate proposals was published in Southern Ag Today on June 24, 2024. While the farm bill was never finalized in 2024, on July 4, 2025, President Trump signed into law the “One Big Beautiful Bill” that included many agricultural provisions. New MAL rates, similar to the previous House Agriculture Committee proposal, were included in Title I Subtitle C of this bill, effective with the 2026 crop year through the 2031 crop year.
Here we compare the MAL rate of 2018 to the new MAL rate, as well as discuss the function of the MAL as a marketing tool to cover operating costs of production. Table 1 shows the 2018 loan rate and the new MAL rates. The MAL rate has increased 10% across the board, except for upland cotton which ranges between 6% and 22%. This wide-ranging percentage increase for upland cotton reflects how the MAL rate in the 2018 Farm Bill is specified from $0.45 to $0.52/lb, but the new rate is a flat $0.55/lb. Given that the loan rate for upland cotton has not actually been below $0.52/lb since the 2018 Farm Bill, this effectively translates to a 6% increase.
Table 1: MAL Rates from the 2018 Farm Bill and the One Big Beautiful Bill
Commodity
Unit
2018 Farm Bill Loan Rate per Unit
New Loan Rate Per Unit
Percentage Increase in Loan Rate from 2018
Forecast Operating Cost per Acre for 20261
2026 Yield Projection2
Barley
bu
2.50
2.75
10%
193.19
81.7
Corn
bu
2.20
2.42
10%
457.90
183.7
Oats
bu
2.00
2.20
10%
168.16
66.2
Peanuts
ton
355.00
390.00
10%
641.80
3986
Rice
cwt
7.00
7.70
10%
784.29
7745
Sorghum
bu
2.20
2.42
10%
184.07
71.9
Soybeans
bu
6.20
6.82
10%
245.59
53.1
Upland Cotton*
lb
0.45-0.52
0.55
6%-22%
568.36
882
Wheat
bu
3.38
3.72
10%
161.25
50.1
1ERS Commodity Cost and Returns, Cost of production forecasts for major U.S. field crops, 2025F-2026F. 6/18/2025 2Food and Agricultural Policy Research Institute (FAPRI) at the University of Missouri, U.S. Agricultural Market Outlook, April 2025, FAPRI-MU Report #01-25 *For upland cotton, the 2018 Farm Bill specifies that the marketing loan rate shall be between $0.45-$0.52/lb and not less than 98% of the loan rate for the preceding year. The rate has been $0.52/lb every year since 2018.
The MAL can be used as part of a broader marketing plan to provide an influx of cash at harvest to help cover operating loans or expenses with potentially more favorable terms. With certainty of the MAL rate through 2031, farmers should now consider how this tool can be used for their specific operation to allow for more time to market crops after harvest. A factsheet with additional information is available from the U.S. Department of Agriculture’s Farm Service Agency
USDA released its Cattle on Feed and July Cattle inventory reports on Friday, July 25th. These reports are a good opportunity to poll some thoughts from our SAT authors across the South.
Will Secor – University of Georgia
The July Cattle and Cattle on Feed reports from USDA provided indications that the cattle herd is approaching a low in inventory but may not be there just yet. The mid-year Cattle report provided a first estimate of the 2025 calf crop, which is projected to be roughly 1.3 percent smaller than the 2024 calf crop. Combined with January’s report of fewer beef cow replacement heifers, this is an indication that the cattle herd may still be smaller come January 2026. However, the Cattle on Feed report indicates that the share of cattle on feed that are heifers declined again year-over-year to its lowest July reading since 2019. Overall, these reports show a continued decline in the cattle inventory, but they also shed some light on the potential of a rebuild that may be starting soon.
Kenny Burdine – University of Kentucky
The fact that there was no mid-year inventory report in 2024 makes comparison a bit difficult. Beef cow inventory was down by 1.2% from July of 2023. Most were expecting beef cow inventory to be down a bit more over the last two years, but I think this speaks to how much lower beef cow slaughter has been running. For the 12 months from July 2024 to June 2025, nearly 650,000 fewer beef cows were harvested than from July 2023 to June 2024. I think it’s likely that beef cow inventory was down by more than that from July 2023 to July 2024, but increased over the last 12 months due to lower slaughter levels. Heifers held for beef cow replacement were down 3% from 2023, which is a decrease of 100,00 head. The best way to think about this number is to consider it as a percentage of beef cow inventory. When looking at it that way, our heifer retention pace is lower than it was in 2023.
The surprise of this quarterly cattle-on-feed report was June placements, which were down 8% from 2024 and outside the range of expectations. Marketings continue to suggest we may be pulling cattle ahead, but placements suggest we are not replenishing them at the same pace.
Heifers, as a percentage of on-feed inventory, came in at 38.1%. This is about a percent and a half lower than July 1 of 2024, but up about half a percent from April of this year. Much like the beef replacement heifer estimate from the inventory report, this does not suggest much retention is occurring. Any growth in beef cow numbers is coming from reduced cow slaughter.
Shifting my focus towards home, I don’t think much retention is occurring in Kentucky at present. Anecdotally, producers tell me they are not keeping heifers at these price levels. I also think interest rates are impacting this decision. I do expect some expansion to occur in the Commonwealth over the next few years, but we are limited by land constraints and land costs.
Andrew Griffith – University of Tennessee
I don’t really know what to say about these reports. A lot of the time we discuss industry estimates compared to USDA estimates. The main thing in this report is we saw lower beef cow numbers, a smaller calf crop, and fewer cattle on feed.
It looks like more heifers are being retained this year and fewer cows are being slaughtered. There is a good chance we see a steady to slightly higher beef cow number come January 1, 2026. Of course, drought could hit once again and further delay rebuilding.
The one thing I feel certain is that the competition for cattle is going to be fierce the next couple of years. I think we will see closures, idling, or consolidation of packing plants and feedlots. Even if that does not happen, capacity utilization is going to be small. This also feeds back to stocker and backgrounders who will be growing a smaller number of cattle than usual, which will influence profitability.
Josh Maples – Mississippi State University
I don’t see significant signs of expansion from these reports. Heifers held for beef cow replacement were down 3% from the 2023 report. The 5% drop in heifers placed into feedlots during the last quarter is the number that jumps out as the question mark. But, taken with all of the other data, I’m not yet ready to call it an obvious sign of expansion. After accounting for fewer imports from Mexico, heifer placement is down 2.5% during the first half of 2025 compared to the first half of 2024. It could just be that we have fewer heifers due to smaller calf crops, and that there are some differences in placement timing. The overall percentage of heifers on feed ticked back up to 38% after dropping in the previous quarter. I think 2025 is likely a stabilization year for beef cow inventory, with 2026 having the higher odds for modest expansion if pasture conditions cooperate.
Hannah Baker – University of Florida
While the 2025 July Inventory Report does not include state breakdowns, the numbers reported in both the inventory and cattle on feed reports reflect what is happening across Florida: some producers are thinking of and starting to retain heifers, but the majority are still capitalizing on record-high calf prices. Beef replacement heifers are down 3 percent from 2023, and the beef cow herd is smaller by 350,000 head. The number of “other heifers over 500 pounds” is also 3 percent lower than 2023, meaning there is also a smaller pool of heifers to pull from for any impulse breeding in the back half of 2025 and early 2026. Signs of slow heifer retention are also shown in the Cattle on Feed report, where the number of heifers on feed was 5% lower than 2024, but the percentage of heifers on feed rose by 0.5% since April to 38.1%.
James Mitchell – University of Arkansas
A statistic I like to track is the ratio of July beef replacement heifers relative to the previous year’s calf crop (as estimated in the January report). I use this as a crude indicator of retention and potential herd expansion. The estimate for July 2025 is 11.04%, nearly identical to July 2023 at 11.03%. For comparison, the ratio was 14.32% in July 2015. We’re not there yet, which makes me wonder: with strong profitability over the last few years, are producers reinvesting in other ways – farm infrastructure, equipment, land?
Charley Martinez – University of Tennessee
It’s unfortunate that we didn’t have last year’s July 1 report. But, when looking at the percentage of changes between 2023 and 2025, I think the trends were expected. The most interesting statistic to me was the expected 2025 calf crop of 33.1 million head. The calf crop was 33.56 million in 2023, and 33.52 million in 2024. The calf crop expectation highlights the impacts of the shrinking herd over the last two years, and the expected tighter feeder calf supply signals continued elevated feeder calf prices. This report also starts the excitement for the January 1 report, where we will have statistics and more detailed data.
Farmland is one of the most important assets for agricultural producers, serving as both a source of income and a foundation for their livelihood. With continued strong demand for agricultural land, farmland values in the Southern U.S. have steadily increased over time. According to the USDA Economic Research Service, the compound annual growth rate of farmland values between 2018 and 2024 was around 5 percent.
However, in recent years, there has been growing discussion that demand for farmland isn’t coming solely from producers. From media reports and even casual conversations with neighbors, we often hear about billionaires purchasing large tracts of farmland or significant parcels being sold to developers. Yet despite these stories and the concerns they raise, there is little concrete information about how frequently non-producer buyers are participating in the farmland market. This leads us to an important question: How active are non-agricultural buyers in today’s agricultural land market?
Using transaction-level data from lending institutions in Mississippi covering the period from 2019 through the first half of 2023, we can begin to understand the different types of buyers in the agricultural land market. Buyers are categorized into four groups: (1) individuals and general partnerships (GPs), likely involved in agricultural production; (2) financial and real estate businesses; (3) non-individual/non-GP agricultural businesses; and (4) other industries. Other than the first group (individuals and GPs), the rest are limited partnerships, limited liability companies, and corporations, and they are grouped based on the North American Industry Classification System (NAICS) codes.
Figure 1: Number of Agricultural Land Transactions by Buyer Type
Figure 1 shows the number of farmland transactions completed by four groups between 2019 and the first half of 2023: (1) individuals and general partnerships (GPs), (2) financial and real estate businesses, (3) non-individual/non-GP agricultural businesses, and (4) all other business entities.
What we find is that the majority of farmland transactions in Mississippi are predominantly carried out by individuals and GPs. Between 75% and 83% of all transactions during this period involved buyers from this group. The presence of financial and real estate businesses in the market has grown over time, even though their overall share still remains somewhat small. Their share of total farmland transactions ranges between 6.36% in 2019 and 10.42% in the first half of 2023—surpassing the share of non-individual/non-GP agricultural businesses, which ranged from 7% to 9% during the same period. The final group—comprised of other businesses such as those in construction, warehousing, and unrelated industries—accounted for approximately 4% to 6% of total transactions.
In summary, individuals and general partnerships (GPs) remain the most active participants in the farmland market in terms of transaction frequency. However, there is an increase in the number of non-individual/non-GP buyers, particularly financial and real estate developers. While this external demand may help support farmland values, it can also contribute to upward pressure on land prices—bringing both potential benefits and challenges for agricultural producers. Moreover, this shift in ownership patterns coincides with a long-term decline in U.S. farmland acreage, but identifying the actual relationship will require more rigorous examination. As the farmland market continues to evolve, understanding who is buying agricultural land—and why—becomes increasingly important. Continued monitoring of buyer trends can help inform policy discussions, land use planning, and long-term strategies.
