Rising costs and record harvests challenge global crop profits
A new RaboResearch report warns that rising operating costs and declining agricultural commodity prices will continue to pressure farmers across major crop regions through at least mid-2027.
Analysts say global field crop margins are under strain as producers face higher input expenses and weaker returns.
The report highlights that 2025 is already proving more complex than last year, with geopolitical tensions and new tariffs adding to uncertainty. Although some crop protection costs may ease, overall operating expenses remain elevated.
Soybean and corn producers are particularly affected.
Bruno Fonseca, Senior Analyst for RaboResearch, explains that record production of corn and soybeans is adding downward pressure on prices. Despite reduced stock levels, large harvests in Brazil, China, and the United States are overwhelming markets and creating a short-term bear market.
Looking ahead to the 2026 planting season, operating costs are expected to climb further, led by higher fertilizer prices. A tighter global supply-demand balance is driving fertilizer costs upward and pushing the affordability index for phosphate to its lowest point since 2010 at –0.68. Fonseca warns that without improved affordability, demand for fertilizer could fall significantly in the next planting cycle.
Prices for some crop protection ingredients sourced from China are easing compared to last year, but per-hectare costs remain higher in the United States and Brazil because of reduced supplies. RaboResearch projects the 2026 season will be more expensive across all major regions.
Even as global corn, wheat, and oilseed production reaches record highs for a sixth consecutive year, domestic consumption of these crops is also at historic levels. Yet strong demand cannot offset the market impact of record supply. With input prices near historic highs, the report concludes that profitability for grain and oilseed farmers will remain challenging for the foreseeable future.
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