Energy Costs Squeeze American Farms Amid Global Shocks

Global shocks are reaching American farms, putting pressure on grain producers due to rising fuel and fertiliser costs.

The US Department of Agriculture forecasts total farm production expenses at $477.7 billion in 2026, up 1% in nominal terms but down slightly after inflation.

Farms produce not only food and feed but also fuel, with 36% of total US corn use going to fuel ethanol in the 2024/25 marketing year.

The complex relationship between energy and agriculture is further complicated by biofuels, which tie farm returns more closely to energy policy and oil prices.