The story of agriculture in 2025 can be summed up in a few words: big supplies, soft prices and elevated costs. While overall farm income showed improvement from the prior year, many producers across the country felt financial pressure as crop prices struggled to keep up with rising costs of production. Uncertain export demand was also a major market factor in 2025, primarily the trade war with China.

Grain markets spent most of the year under pressure. The U.S. grew a record corn crop, keeping supplies plentiful and limiting price rallies. Soybeans faced similar challenges, with weaker export demand weighing heavily on futures and cash markets. Wheat supplies remained ample worldwide, which capped upside potential even during weather scares. Corn did find some support from record export shipments, helping stabilize prices, but rallies were generally hard to sustain.

Despite weak crop prices, U.S. farm income rebounded compared to 2024, largely due to government support payments and stronger livestock markets. Crop cash receipts declined overall, but sharp gains in the livestock complex helped lift total farm revenues.

At the same time, input costs stayed uncomfortably high. Fertilizer prices rose again compared to last year, driven by energy markets and global supply concerns. Fuel, seed, chemical, and equipment costs also remained elevated. Many producers delayed major machinery purchases, choosing instead to repair older equipment to conserve cash.

Trade issues were another major theme of 2025, particularly for soybeans. Tensions with China flared again, sharply reducing U.S. soybean purchases by what has historically been America’s largest customer. The loss of that demand left bins fuller and basis levels weaker in many regions right at the U.S. harvest, underscoring the risks of relying heavily on a single export destination. While alternative markets absorbed some volume, they were unable to fully replace Chinese demand.

Looking ahead, farmers are entering 2026 with cautious optimism and plenty of questions. Export demand, particularly for soybeans, remains a key uncertainty. Input costs will be watched closely, as any relief could significantly improve margins. Weather, as always, will play an outsized role, both domestically and globally as an ever-growing need for large crops means any stress is a factor in price discovery.

Over the past several weeks the United States has seen an increase in feed demand for corn. While this remains elevated, corn is starting to see more competition in the global market from cheaper feed grains, including wheat and now barley. The spread between corn and wheat has narrowed to 70 cents which heavily favors wheat consumption. The normal spread is $1.30 to $1.50. Wheat feeding also cuts the need for supplementing as it has a higher protein content than corn.

Milling demand for wheat has also increased recently. This is from the absence of Ukraine in the global market. Ukraine exports 70 percent of its wheat production and the majority of this is for milling purposes. This flow has been disrupted since the start of the war with Russia, but recently more attacks have taken place to Ukraine ports. At the present time Ukraine’s ports are operating at just 20 percent of capacity from several factors, including a lack of electricity. This has brought the U.S. higher than usual export demand.

Chinese customs import data for the month of November has been released with some interesting numbers. China’s corn imports in November totaled 560,000 mt, an increase of 87.5 percent from November 2024. China also imported 250,000 mt of wheat in November, a year-to-year increase of 279 percent. While year-to-date grain imports still trail last year, these increases come as China claims to have harvested “bumper crops” of grain this year, raising suspicion on their actual usable grain inventory. China’s November soybean imports totaled 8.11 mmt, a 13.3 percent increase on the year.

Data shows China also imported 60,000 mt of pork in November, a 34 percent decline from 2024 as China has been downsizing its domestic hog herd. China’s year to date pork imports total 920,000 mt, a 6.2 percent reduction from last year. China’s November beef imports totaled 190,000 mt, down 28 percent from a year ago. China’s year to date beef imports total 2.53 mmt, steady from a year ago.

Brazil’s analytical group Ag Rural is reporting the very early start of the Brazilian soybean harvest is taking place. While there is not enough of this taking place to get a clearer picture of the entire Brazil soybean crop, we may start to see its impact on Brazil markets, mainly cash values. As the Brazil soybean harvest advances, basis will be the first indication of not only yields, but farmer intent. Even if Brazil does harvest a large crop, lack of selling will cause the country’s values to firm.

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