The ongoing conflict in the Middle East has created volatility in fertilizer prices. While the duration of the conflict is hard to predict, the prolonged rise in energy prices (crude oil and natural gas) can have an impact on the price that U.S. agriculture producers pay for fertilizer. In turn, this can impact farm profitability at a time when margins are razor thin.&nbsp;



The Fertilizer Institute noted that 65% of overall U.S. agricultural nitrogen (N), phosphate (P), and potassium (K) needs are sourced by domestic production. However, the remaining 35% is supplemented by imports. Measured as the percent of imports relative to consumption, the U.S. imports 6% of its N needs- mainly from Trinidad and Tobago and Canada; 13% of its P needs from Peru and Morocco; and 94% of its K needs from Canada, Russia, Belarus, and Israel (Monaco, Schnitkey, and Paulson, 2025). Therefore, exposure to the global fertilizer market can lead to significant price volatility when geopolitical conflicts arise.



By examining fertilizer and fuel costs associated with corn, cotton, rice, and soybean production in Louisiana, a comparison is made between early January and mid-March prices. The early-January fertilizer and farm diesel expenditures were revisited by using the March 13, 2026, USDA AMS Alabama Production Cost Report’s diesel price and average bids for urea, DAP, and potash fertilizers. The price increase varies across nutrients, with N (urea) increasing by 27%, followed by K (potash) at 10%. Interestingly, DAP (P) declined but did show a relatively large price range ($756 to $1,075 per ton) in the weekly USDA report. Fuel prices increased from $2.85 to $4.04 per gallon, a $1.19 (42%) increase. 



Table 1. Fertilizer input unit prices ($ per pound of active ingredient), January and March estimates.



<figure class="wp-block-table has-medium-font-size"><table><tbody><tr><td class="has-text-align-center" data-align="center">Fertilizer</td><td class="has-text-align-center" data-align="center">January</td><td class="has-text-align-center" data-align="center">March</td><td class="has-text-align-center" data-align="center">Change</td><td class="has-text-align-center" data-align="center">Change</td></tr><tr><td class="has-text-align-center" data-align="center">N</td><td class="has-text-align-center" data-align="center">$0.60</td><td class="has-text-align-center" data-align="center">$0.76</td><td class="has-text-align-center" data-align="center">$0.16</td><td class="has-text-align-center" data-align="center">27%</td></tr><tr><td class="has-text-align-center" data-align="center">P</td><td class="has-text-align-center" data-align="center">$1.03</td><td class="has-text-align-center" data-align="center">$0.99</td><td class="has-text-align-center" data-align="center">-$0.04</td><td class="has-text-align-center" data-align="center">-4%</td></tr><tr><td class="has-text-align-center" data-align="center">K</td><td class="has-text-align-center" data-align="center">$0.40</td><td class="has-text-align-center" data-align="center">$0.44</td><td class="has-text-align-center" data-align="center">$0.04</td><td class="has-text-align-center" data-align="center">10%</td></tr></tbody></table></figure>



The level of fertilizer and fuel needs varies by crop nutrient requirements and irrigation method/frequency. For Louisiana crops, per-acre N needs are the highest in corn (210 pounds) and hybrid rice (150 pounds), while cotton requires 90 pounds and soybeans require none. P and K needs are relatively consistent among the selected crops at 60 and 40 pounds per acre. The suggested fertilizer rates for poly-pipe and flood irrigation applications were obtained from the LSU AgCenter. Tables 2-5 provide a January and March comparison of production expenditures for these energy-related inputs on a dollar per acre basis.&nbsp;



Table 2. Corn, cotton, rice, soybean fertilizer and fuel expenditures per acre, January and March estimates for Louisiana production.&nbsp;



<figure class="wp-block-table is-style-stripes has-small-font-size"><table><tbody><tr><td colspan="6">Corn&nbsp;</td></tr><tr><td colspan="2">Early-January&nbsp;</td><td class="has-text-align-center" data-align="center" colspan="2">Mid-March</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Change ($)</td><td class="has-text-align-center" data-align="center">Change (%)</td></tr><tr><td>Fertilizer</td><td class="has-text-align-center" data-align="center">$180.90</td><td class="has-text-align-center" data-align="center">Fertilizer</td><td class="has-text-align-center" data-align="center">$214.96</td><td class="has-text-align-center" data-align="center">$34.06</td><td class="has-text-align-center" data-align="center">19%</td></tr><tr><td>Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$49.49</td><td class="has-text-align-center" data-align="center">Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$70.16</td><td class="has-text-align-center" data-align="center">$20.67</td><td class="has-text-align-center" data-align="center">42%</td></tr><tr><td>Total&nbsp;</td><td class="has-text-align-center" data-align="center">$230.39</td><td class="has-text-align-center" data-align="center">Total&nbsp;</td><td class="has-text-align-center" data-align="center">$285.12</td><td class="has-text-align-center" data-align="center">$54.73</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td colspan="6">Cotton</td></tr><tr><td colspan="2">Early-January&nbsp;</td><td class="has-text-align-center" data-align="center" colspan="2">Mid-March</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Change ($)</td><td class="has-text-align-center" data-align="center">Change (%)</td></tr><tr><td>Fertilizer</td><td class="has-text-align-center" data-align="center">$139.80</td><td class="has-text-align-center" data-align="center">Fertilizer</td><td class="has-text-align-center" data-align="center">$153.82</td><td class="has-text-align-center" data-align="center">$14.02</td><td class="has-text-align-center" data-align="center">10%</td></tr><tr><td>Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$65.43</td><td class="has-text-align-center" data-align="center">Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$92.75</td><td class="has-text-align-center" data-align="center">$27.32</td><td class="has-text-align-center" data-align="center">42%</td></tr><tr><td>Total&nbsp;</td><td class="has-text-align-center" data-align="center">$205.23</td><td class="has-text-align-center" data-align="center">Total&nbsp;</td><td class="has-text-align-center" data-align="center">$246.57</td><td class="has-text-align-center" data-align="center">$41.34</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td colspan="6">Rice</td></tr><tr><td colspan="2">Early-January&nbsp;</td><td class="has-text-align-center" data-align="center" colspan="2">Mid-March</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Change ($)</td><td class="has-text-align-center" data-align="center">Change (%)</td></tr><tr><td>Fertilizer</td><td class="has-text-align-center" data-align="center">$155.20</td><td class="has-text-align-center" data-align="center">Fertilizer</td><td class="has-text-align-center" data-align="center">$179.45</td><td class="has-text-align-center" data-align="center">$24.25</td><td class="has-text-align-center" data-align="center">16%</td></tr><tr><td>Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$128.09</td><td class="has-text-align-center" data-align="center">Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$181.57</td><td class="has-text-align-center" data-align="center">$53.48</td><td class="has-text-align-center" data-align="center">42%</td></tr><tr><td>Total&nbsp;</td><td class="has-text-align-center" data-align="center">$283.29</td><td class="has-text-align-center" data-align="center">Total&nbsp;</td><td class="has-text-align-center" data-align="center">$361.02</td><td class="has-text-align-center" data-align="center">$77.73</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td colspan="6">Soybeans</td></tr><tr><td colspan="2">Early-January&nbsp;</td><td class="has-text-align-center" data-align="center" colspan="2">Mid-March</td><td class="has-text-align-center" data-align="center">&nbsp;</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr><tr><td>Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Item</td><td class="has-text-align-center" data-align="center">Cost</td><td class="has-text-align-center" data-align="center">Change ($)</td><td class="has-text-align-center" data-align="center">Change (%)</td></tr><tr><td>Fertilizer</td><td class="has-text-align-center" data-align="center">$71.50</td><td class="has-text-align-center" data-align="center">Fertilizer</td><td class="has-text-align-center" data-align="center">$71.44</td><td class="has-text-align-center" data-align="center">-$0.06</td><td class="has-text-align-center" data-align="center">0%</td></tr><tr><td>Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$33.04</td><td class="has-text-align-center" data-align="center">Fuel&nbsp;</td><td class="has-text-align-center" data-align="center">$46.83</td><td class="has-text-align-center" data-align="center">$13.79</td><td class="has-text-align-center" data-align="center">42%</td></tr><tr><td>Total&nbsp;</td><td class="has-text-align-center" data-align="center">$104.54</td><td class="has-text-align-center" data-align="center">Total&nbsp;</td><td class="has-text-align-center" data-align="center">$118.27</td><td class="has-text-align-center" data-align="center">$13.73</td><td class="has-text-align-center" data-align="center">&nbsp;</td></tr></tbody></table></figure>



For example, Louisiana corn fertility cost increased by $34 while diesel fuel for tractors, implements, and irrigation pumps increased by $21 per acre. In total, corn’s energy-related input costs increased by almost $55 per acre. Cotton’s energy-related input costs increased by $41 per acre. From Table 4, the energy-related input costs for rice increased by $78 per acre due to the paddy flood irrigation practice. Since soybeans received no N, the cost increase was the lowest at $14 per acre.&nbsp;



As economic conditions in the farm economy remain a concern for producers, restrictions on cash flows have acted to reduce the amount of inputs producers may pre-book earlier in the year when fertilizer and fuel prices were lower. This is an example of how geopolitical unrest and market distributions can affect local farming profitability.&nbsp;



Translating this production cost increase as a function of increased yield, a producer would have to yield an additional 11 bushels of corn per acre (at a price of $5.00); 111 pounds of cotton lint ($0.70 price); 6.4 hundredweights of rice ($12.20 price); and 7 bushels of soybeans ($11.80 price). As Louisiana benefited from favorable production conditions in 2025, further increases in yield per acre would likely exceed state records. While this information is specific to Louisiana, the application of partial enterprise budgeting can be applied to other states. This economic analysis understates the fact that, given the current farm economic conditions, generating additional per-acre production to compensate for increasing production costs is difficult even with a moderate improvement in commodity prices.&nbsp;



References



Deliberto, M. and B. Hilbun. “Projected Costs and Returns for Corn in Louisiana.” LSU AgCenter, January 2026.



Deliberto, M. and B. Hilbun. “Projected Costs and Returns for Cotton in Louisiana”. LSU AgCenter, January 2026.



Deliberto, M. and B. Hilbun. “Projected Costs and Returns for Rice in Louisiana.” LSU AgCenter, January 2026.



Deliberto, M. and B. Hilbun. “Projected Costs and Returns for Soybeans in Louisiana.” LSU AgCenter, January 2026.



Monaco, H., G. Schnitkey, and N. Paulson. &#8220;U.S. Fertilizer Industry in Global Markets: Structure and Supply Risks.&#8221; farmdoc daily (15):137, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, July 29, 2025.&nbsp;<a href="https://farmdocdaily.illinois.edu/2025/07/us-fertilizer-industry-in-global-markets-structure-and-supply-risks.html">https://farmdocdaily.illinois.edu/2025/07/us-fertilizer-industry-in-global-markets-structure-and-supply-risks.html</a>



The Fertilizer Institute. ““Pressure Cooker: Competition in the Seed &amp; Fertilizer Industries.” Written remarks of Mr. Corey Rosenbusch, President and CEO of The Fertilizer Institute, before the U.S. Senate Judiciary Committee. October 28, 2025.&nbsp;&nbsp;<a href="https://www.judiciary.senate.gov/imo/media/doc/57806f69-9cd2-0a74-ac7a-d2b236ce9e3b/2025-10-28_Testimony_Rosenbusch.pdf">https://www.judiciary.senate.gov/imo/media/doc/57806f69-9cd2-0a74-ac7a-d2b236ce9e3b/2025-10-28_Testimony_Rosenbusch.pdf</a>



USDA, AMS. “Alabama Production Cost Report”. March 13, 2026.



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Deliberto, Michael. &#8220;<a href="https://southernagtoday.org/2026/05/04/initial-response-of-fertilizer-and-fuel-price-spikes-on-farm-costs-and-returns/">Initial Response of Fertilizer and Fuel Price Spikes on Farm Costs and Returns.</a>&#8221; Southern Ag Today 6(20.1). May 11, 2026. <a href="https://southernagtoday.org/2026/05/04/initial-response-of-fertilizer-and-fuel-price-spikes-on-farm-costs-and-returns/">Permalink</a>

Initial Response of Fertilizer and Fuel Price Spikes on Farm Costs and Returns 

Cooperative Involvement in Rural Food Systems



Rural food systems<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftn1">[1]</a>, including the local foods movement, have been a popular topic over the last twenty years and gained even more popularity during the COVID-19 pandemic.&nbsp;&nbsp;Did this movement also encourage more cooperatives?&nbsp;&nbsp;To hone in on this, a survey of twenty-two CooperationWorks!<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftn2">[2]</a>&nbsp;members was performed in 2025, representing every state except for Nevada, Arizona, and Utah.&nbsp;&nbsp;



Cooperative Involvement in Rural Food Systems by Purpose and Activity



Survey results hint at the prevalence of cooperatives in rural food systems and the purposes and activities they represent<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftn3">[3]</a>.&nbsp;&nbsp;Figure 1 shows that cooperatives are mentioned more often in relation to local, specialty, and niche-based foods. In contrast, other organizations, such as non-profit organizations and NGOs, are more often mentioned in relation to efforts to address nutrition and food insecurity. Figure 2 shows the mentions of cooperative involvement by specific rural food system activities. Food production and distribution are the most frequently mentioned activities, followed by rural grocery stores, food processing, and multi-stakeholder firms<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftn4">[4]</a>.



The Importance of Cooperatives in Rural Food Systems



While this survey does not measure the magnitude of cooperative involvement in rural food systems, it suggests that cooperatives are an important ingredient. Open-ended survey responses suggest that cooperatives involved in rural food systems tend to be newer and smaller, unlike older and larger “legacy” commodity cooperatives.&nbsp;&nbsp;This makes sense, as many aspects of rural food systems, such as local food systems, are also small and new, accounting for about 3.2% of our nation’s food supply (USDA NASS, 2024).



Figure 1: Cooperatives Mentioned in Rural Food Systems by Purpose



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="603" height="365" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.5-1.jpg" alt="" class="wp-image-43898"/></figure>



Figure 2: Cooperatives Mentioned in Rural Food Systems by Activity



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="600" height="363" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.5-2.jpg" alt="" class="wp-image-43899"/></figure>



The Cooperative Advantage



Many survey respondents expressed concerns about the continued availability of grant funding for rural food system efforts, as some have vanished amid shifting priorities away from COVID-era initiatives (e.g., LFPA grants). Cooperatives may have an advantage here, as cooperative members contribute equity to their organizations, potentially insulating them from changes in public funding priorities.&nbsp;



If you are part of a cooperative, stay engaged by attending meetings, voting in elections, and serving on the board.&nbsp;&nbsp;If you are looking to start a cooperative,&nbsp;<a href="https://cooperationworks.coop/">CooperationWorks!</a>&nbsp;and many&nbsp;<a href="https://www.nifa.usda.gov/grants/land-grant-university-website-directory">land-grant universities</a>&nbsp;have extension personnel and cooperative specialists available to assist.



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<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftnref1">[1]</a>&nbsp;Rural food systems are largely synonymous with local and regional food systems: networks connecting food production, processing, distribution, and consumption within a specific region.&nbsp;&nbsp;



<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftnref2">[2]</a>&nbsp;CooperationWorks! is a national network of cooperative development organizations in the US.&nbsp;<a href="https://cooperationworks.coop/">https://cooperationworks.coop/</a>



<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftnref3">[3]</a>&nbsp;The survey questions record the number of responses that mention cooperatives being involved in these activities and purposes.&nbsp;&nbsp;These percentages should not be considered the number or percentage of cooperatives involved in these activities or with these purposes. This survey is simply a barometer of whether cooperatives are involved in rural food systems.&nbsp;



<a href="applewebdata://C3389DCF-F519-45EA-B7B8-25D1612E6B1B#_ftnref4">[4]</a>&nbsp;Multi-stakeholder firms are those with multiple membership types (e.g., producers and consumers), voting and investment options.&nbsp;&nbsp;Some states allow cooperatives to have these features, and some do not.&nbsp;



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Richards, Steven. &#8220;<a href="https://southernagtoday.org/2026/05/04/cooperative-involvement-in-rural-food-systems/">Cooperative Involvement in Rural Food Systems.</a>&#8221; Southern Ag Today 6(19.5). May 8, 2026. <a href="https://southernagtoday.org/2026/05/04/cooperative-involvement-in-rural-food-systems/">Permalink</a>

Cooperative Involvement in Rural Food Systems

Authors: Luis Ribera and Landyn K. Young



The U.S. is highly competitive in agricultural production and the largest agricultural exporter in the world. In 2024, these exports were estimated to total $181.3 billion. Given that the world population is expected to reach nearly 10 billion by 2050, the U.S. is well positioned to be the source of agricultural products to feed the growing population.&nbsp;&nbsp;Moreover, global GDP is expected to grow between 2 and 4 percent through 2050. This means that not only will there be more people to feed, but also those people will have more purchasing power.



Of the top eight U.S. agricultural export commodities, the U.S. ranks first in global exports of corn and pork, and second in soybeans, cotton, and poultry (Table 1).&nbsp;&nbsp;Meanwhile, Brazil, another powerhouse in agricultural production with $144.4 billion in agricultural exports in 2024, ranks first in global exports of soybeans, beef and veal, cotton and chicken, and second in corn and soybean meal.&nbsp;&nbsp;Brazil’s ability to double crop, produce two crops in the same season, and its potential to double or even triple its cropland puts it in a very advantageous position to continue to increase its global food market share. On the other hand, U.S. productivity and agricultural infrastructure, i.e., roads, rail, waterways, and ports, help in remaining competitive globally.



One area that erodes U.S. competitiveness is the increase in government regulations.&nbsp;&nbsp;To illustrate, Figure 1 shows the total number of pages published in the Code of Federal Regulations, increasing from around 15,000 in 1950 to around 190,000.&nbsp;&nbsp;&nbsp;If the cost of U.S. regulations were a country, it would be the fourth richest country in the world, just behind the U.S., China, and Japan. Moreover, a study by the National Association of Home Builders stated that 23.8 percent of the cost of a new single-family home, or an average of $93,870, is due to government regulations.&nbsp;&nbsp;Finally, regulatory costs, also known as societal hidden taxes, are equivalent to $14,684 or 22 percent of the 2020 annual household expense budget; more than any other expenses except housing, which is $22,624 (Figure 2).



Regulatory costs are an added source of concern to&nbsp;agricultural production as well.&nbsp;A study by Hamilton and McCullough (2025) showed that while production costs for a lettuce farmer in Salinas Valley, California, have increased significantly over the years, regulatory costs have increased exponentially from 2006 to 2024 (Table 2). In 2006, the cooperating lettuce grower reported regulatory costs totaling $109.15 per acre, increasing to $977.30 per acre in 2017, and growing to $1,600.12 per acre in 2024, which is a 63.7 percent increase from 2017 and a 1,366 percent increase since 2006. Regulatory costs comprised just 1.24 percent of production costs in 2006, then rose to 8.9 percent in 2017 and 12.6 percent of production costs in 2024.&nbsp;&nbsp;Agriculture is a hard business to be in; producers deal with constant price volatility, increasing input costs, pests, and weather, among many other challenges outside of their control.&nbsp;&nbsp;On top of that are increasing regulatory costs, which add yet another barrier to remaining competitive in the global arena with countries that do not have such a burden.&nbsp;



Table 1. Ranking of Agricultural Exports for Selected Commodities, 2025



<figure class="wp-block-table is-style-stripes has-small-font-size"><table class="has-fixed-layout"><tbody><tr><td>&nbsp;</td><td class="has-text-align-center" data-align="center">United States</td><td class="has-text-align-center" data-align="center">Brazil</td></tr><tr><td>Corn</td><td class="has-text-align-center" data-align="center">1</td><td class="has-text-align-center" data-align="center">2</td></tr><tr><td>Soybean</td><td class="has-text-align-center" data-align="center">2</td><td class="has-text-align-center" data-align="center">1</td></tr><tr><td>Beef-Veal</td><td class="has-text-align-center" data-align="center">4</td><td class="has-text-align-center" data-align="center">1</td></tr><tr><td>Pork</td><td class="has-text-align-center" data-align="center">1</td><td class="has-text-align-center" data-align="center">3</td></tr><tr><td>Wheat</td><td class="has-text-align-center" data-align="center">5</td><td class="has-text-align-center" data-align="center">10</td></tr><tr><td>Soybean Meal</td><td class="has-text-align-center" data-align="center">3</td><td class="has-text-align-center" data-align="center">2</td></tr><tr><td>Cotton</td><td class="has-text-align-center" data-align="center">2</td><td class="has-text-align-center" data-align="center">1</td></tr><tr><td>Poultry</td><td class="has-text-align-center" data-align="center">2</td><td class="has-text-align-center" data-align="center">1</td></tr></tbody></table><figcaption class="wp-element-caption">Source: Production, Supply, Distribution (USDA/FAS)</figcaption></figure>



Figure 1. Total Pages Published in the Code of Federal Regulations, 1950-2023.



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="551" height="397" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.4-F1-1.png" alt="" class="wp-image-43906"/></figure>



Figure 2. U.S. Household Expense Budget of $66,928 Compared to Regulatory Costs



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="778" height="582" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.4-F2.jpg" alt="" class="wp-image-43907" srcset="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.4-F2.jpg 778w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.4-F2-768x575.jpg 768w" sizes="auto, (max-width: 778px) 100vw, 778px" /></figure>



Table 2. Regulatory Costs for Salinas Valley Lettuce Grower, 2006, 2017, and 2024.



<figure class="wp-block-table is-style-stripes has-small-font-size"><table><tbody><tr><td>Regulatory Category</td><td>2006</td><td>2017</td><td>2024</td></tr><tr><td>&nbsp;</td><td colspan="3">Cost per acre</td></tr><tr><td>Education/Training for Regulatory Compliance</td><td>$1.27</td><td>$26.31</td><td>$25.60</td></tr><tr><td>Air Quality Requirements&nbsp;</td><td>$0.00</td><td>$5.31</td><td>$8.29</td></tr><tr><td>Water Quality/Quality Requirements&nbsp;</td><td>$4.30</td><td>$18.57</td><td>$29.72</td></tr><tr><td>Department of Pesticide Regulation</td><td>$22.98</td><td>$35.55</td><td>$47.59</td></tr><tr><td>Food Safety – LGMA Assessments</td><td>$0.64</td><td>$181.48</td><td>$244.15</td></tr><tr><td>Food Safety – PR Assessments</td><td>$19.66</td><td>$14.88</td><td>$13.18</td></tr><tr><td>Labor Health &amp; Safety Requirements</td><td>$0.00</td><td>$28.72</td><td>$43.71</td></tr><tr><td>Worker’s Compensation</td><td>$58.94</td><td>$336.23</td><td>$428.40</td></tr><tr><td>ACA Requirements</td><td>$0.00</td><td>$141.19</td><td>$334.47</td></tr><tr><td>Labor Wage Requirements</td><td>$1.36</td><td>$189.10</td><td>$425.00</td></tr><tr><td>Totals (per acre)</td><td>$109.16</td><td>$977.34</td><td>$1,600.12</td></tr></tbody></table><figcaption class="wp-element-caption">Source: Hamilton &amp; McCullough, 2025</figcaption></figure>



References



Adcock Flynn,&nbsp;Luis A. Ribera, Yuri Calil, and Constanza Valdes.&nbsp;&nbsp;“Brazil at 2040: Customer and Competitor.”&nbsp;&nbsp;Center for North American Studies, Department of Agricultural Economics, Texas A&amp;M University.&nbsp;&nbsp;&nbsp;CNAS Report 2018-02.&nbsp;&nbsp;October 2018.



Coffey, Bentley, Patrick A. McLaughlin, and Pietro Peretto.&nbsp;&nbsp;“The Cumulative Cost of Regulations.”&nbsp;&nbsp;April 2016



Crews Jr., Clyde Wayne.&nbsp;&nbsp;2026. “Ten Thousand Commandments, 2026: An Annual Snapshot of the Federal Regulatory State.”&nbsp;&nbsp;30th&nbsp;Anniversary Competitive Enterprise Institute Edition.



Calil, Yuri and Luis A. Ribera.&nbsp;&nbsp;2019. “Brazil’s Agricultural Production and Its Potential as Global Food Supplier.”&nbsp;&nbsp;Choices Magazine.&nbsp;&nbsp;Quarter 3.



Hamilton, Lynn and Michael McCullough. “A Decade of Change: A Case Study of Regulatory Compliance Costs in the Produce Industry.” Cal Poly, San Luis Obispo. January 2025.



IMF World Economic Outlook (WEO). October 2015.



World Bank. “Global Economic Prospects.” January 2026.



World Trade Organization. “World Trade in Agriculture.” January 22, 2026.



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Ribera, Luis, and Landyn K. Young. <a href="https://southernagtoday.org/2026/05/04/u-s-agricultural-competitiveness-and-regulation-costs/">&#8220;U.S. Agricultural Competitiveness and Regulation Costs.</a>&#8221; Southern Ag Today 6(19.4). May 7, 2026. <a href="https://southernagtoday.org/2026/05/04/u-s-agricultural-competitiveness-and-regulation-costs/">Permalink</a>

U.S. Agricultural Competitiveness and Regulation Costs

In their April 8, 2026,&nbsp;<a href="https://southernagtoday.org/2026/04/08/what-producers-need-to-know-about-futures-markets/">Southern Ag Today&nbsp;article</a>, Will Maples and Wendiam Sawadgo explained why futures markets matter for producers. Futures markets help farmers manage price risk, but speculators also play a useful role. Speculators add liquidity and take the “other side” of hedges, assuming price risk. But there is a second question worth asking. What happens when large amounts of financial capital enters agricultural futures markets?



Today&#8217;s agricultural commodity prices reflect more than local crop fundamentals. They also reflect money moving across asset classes. Economists call this “financialization”—the flow of capital into and out of agricultural futures by pension funds, index investors, exchange-traded funds, and managed money. Financial investors trade commodities for different reasons, including diversification and inflation protection. While stocks and bonds respond to interest rates, earnings, and Federal Reserve policy, agricultural commodities respond more directly to drought, exports, livestock cycles, biofuel demand, and global food demand. That difference makes commodities an attractive investment in a portfolio. As commodity index products have grown, agricultural futures markets have gained a larger and more persistent source of outside capital, contributing to price movements that may not always align with underlying crop fundamentals.&nbsp;



The extent to which financialization affects commodity prices remains debated. Fundamentals still dominate long-run agricultural prices, but financial participation can matter at the margin and add liquidity. It can also increase price volatility, moving with oil and other financial markets, as well as news from outside agriculture. Tang and Xiong (2012) found that after the growth of index investment, agricultural commodity futures became more correlated with broader financial markets, especially for commodities included in major indexes.



Using cotton markets as an example, Figure 1 plots the rolling 12-month correlation between monthly ICE cotton futures returns and monthly S&amp;P 500 returns from December 2012 through May 2026. The correlation is positive in most months, averaging about +0.25. It reached +0.91 in the summer of 2020, when cotton and equities rallied together during the pandemic-era policy response. It can also turn negative, such as what occurred in late 2021 and early 2026. Some of this co-movement is fundamental. Cotton is an industrial input for textiles, and apparel demand rises and falls with consumer spending. However, the swings suggest that broader financial conditions may have affected the cotton price signal alongside fundamentals.



Figure 2 helps explain the financial channel. Index trader positions are large and slow to change. Hedge fund positions swing more sharply. Nearby cotton futures prices often move with those swings, but that does not mean hedge funds determine cotton prices. Robinson (2021) estimated that hedge fund positioning contributed to the 2021 rally, while flagging that tightening fundamentals and index fund buying were also at work. The lesson is that speculative flows can amplify short-run price moves.



Financialization does not displace fundamentals. Drought, exports, livestock cycles, and global food demand still drive agricultural prices in the long run. But financial flows now also shape how prices move in the short run, and the strength of that influence varies with the macroeconomic environment. Commodity futures prices carry two signals: one from the field and one from Wall Street. The weight of each changes over time. Producers do not need to become Wall Street traders, but understanding how that signal is built is now part of marketing agricultural commodities.



Figure 1. Rolling 12-Month Correlation Between ICE Cotton No. 2 Futures and the S&amp;P 500, December 2012 Through May 2026. 



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1430" height="614" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.3-1.png" alt="" class="wp-image-43916" srcset="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.3-1.png 1430w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.3-1-1024x440.png 1024w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.3-1-768x330.png 768w" sizes="auto, (max-width: 1430px) 100vw, 1430px" /><figcaption class="wp-element-caption">Source: Author&#8217;s calculations from ICE Cotton No. 2 and S&amp;P 500 monthly prices.</figcaption></figure>



Figure 2. Cotton Net Positions of Index Funds, Hedge Funds, vs Nearby Futures Prices. January 3, 2006, through April 28, 2026



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="624" height="358" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.3-2.jpg" alt="" class="wp-image-43917"/><figcaption class="wp-element-caption">Source: The Cotton Marketing Planner (2026), Prof. John Robinson.&nbsp;</figcaption></figure>



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References.



Maples, W., &amp; Sawadgo, W. (2026, April 8). What producers need to know about futures markets.&nbsp;Southern Ag Today.&nbsp;<a href="https://southernagtoday.org/2026/04/08/what-producers-need-to-know-about-futures-markets/">https://southernagtoday.org/2026/04/08/what-producers-need-to-know-about-futures-markets/</a>



Robinson, J. (2021, November 1). Speculative influence on ICE cotton futures.&nbsp;Southern Ag Today. <a href="https://southernagtoday.org/2021/11/01/speculative-influence-on-ice-cotton-futures/?utm_source=chatgpt.com">https://southernagtoday.org/2021/11/01/speculative-influence-on-ice-cotton-futures/</a>



Robinson, J. (2026). Commitment of Traders: Net position of speculators.&nbsp;The Cotton Marketing Planner, Texas A&amp;M AgriLife Extension. <a href="https://cottonmarketing.tamu.edu/recent-price-patterns-and-short-term-influences/net-position-of-speculators/commitment-of-traders/?utm_source=chatgpt.com">https://cottonmarketing.tamu.edu/recent-price-patterns-and-short-term-influences/net-position-of-speculators/commitment-of-traders/</a>



Tang, K., &amp; Xiong, W. (2012). Index investment and the financialization of commodities.&nbsp;Financial Analysts Journal,&nbsp;68(6), 54–74.&nbsp;<a href="https://doi.org/10.2469/faj.v68.n6.5">https://doi.org/10.2469/faj.v68.n6.5</a>



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Calil, Yuri. &#8220;<a href="https://southernagtoday.org/2026/02/05/how-financial-markets-shape-farm-price/">How Financial Markets Shape Farm Prices</a>.&#8221; Southern Ag Today 6(19.3). May 6, 2026. <a href="https://southernagtoday.org/2026/02/05/how-financial-markets-shape-farm-price/">Permalink</a>

How Financial Markets Shape Farm Price

While calf and fed cattle prices have continued to set new record highs in the cash and futures market, cull cow prices have continued their slow ascent to new highs as lean beef prices keep pulling cow prices higher.&nbsp;&nbsp;Southern Plains cull cow auction prices increased to almost $180 per cwt in late April, up about $15 per cwt since January.&nbsp;&nbsp;The seasonal price increase has been smaller than normal this year.&nbsp;&nbsp;Cutter quality cows have increased about $30 per cwt, almost 25 percent, since the beginning of the year.&nbsp;&nbsp;



One overlooked boost to lean beef prices has been record large fed cattle dressed weights.&nbsp;&nbsp;Average federally inspected fed steer dressed weights have remained over 980 pounds per carcass since late 2025.&nbsp;&nbsp;Larger carcasses produce additional fat that requires more lean beef for blending to boost its value as ground beef rather than just tallow entering the fats and oils market.&nbsp;



After exceeding slaughter of a year ago through the first 10 weeks of 2026, dairy cow culling pulled back to year-ago levels during April.&nbsp;&nbsp;Dairy cow culling typically peaks in January and February each year, then declines into mid-year.&nbsp;&nbsp;The decline in dairy cow slaughter has pulled down total cow culling as weekly beef cow slaughter has held at steady, but low levels.&nbsp;&nbsp;For the year, total dairy cow slaughter is reported up 6 percent compared to last year while total cow slaughter (beef and dairy) is down 5 percent.&nbsp;&nbsp;Beef and dairy cow slaughter is reported weekly by region of the U.S.&nbsp;&nbsp;In recent weeks, reported regional cow slaughter data has declined due to confidentiality rules that prevent publication if there are too few buyers to prevent revealing any one operation’s actions.&nbsp;&nbsp;The lack of reporting due to confidentiality concerns has been a problem in fed cattle reporting for many years.&nbsp;&nbsp;On the positive side, the weekly national cow slaughter data includes all of the regions, including those that could not be reported regionally.



Record high calf prices are likely keeping cows on the ranch or dairy that otherwise would have been culled to get one more calf out of them.&nbsp;&nbsp;As those calves are born and move to weaning, there may be an increase in culling as those cows come to market.&nbsp;&nbsp;Cull prices tend to peak mid-year, so there is room for cow prices to continue to increase over the next couple of months.&nbsp;&nbsp;Beyond just the seasonal pattern arguing for higher prices, cow culling should continue to be lower than last year, further supporting prices.&nbsp;&nbsp;Beef cow slaughter is expected to remain well below a year ago.&nbsp;&nbsp;Better milk prices should restrain dairy cow culling even though the herd remains large.&nbsp;



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1920" height="1440" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-1.jpeg" alt="" class="wp-image-43890" srcset="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-1.jpeg 1920w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-1-1024x768.jpeg 1024w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-1-768x576.jpeg 768w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-1-1536x1152.jpeg 1536w" sizes="auto, (max-width: 1920px) 100vw, 1920px" /></figure>



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1920" height="1440" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-2.jpeg" alt="" class="wp-image-43891" srcset="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-2.jpeg 1920w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-2-1024x768.jpeg 1024w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-2-768x576.jpeg 768w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-2-1536x1152.jpeg 1536w" sizes="auto, (max-width: 1920px) 100vw, 1920px" /></figure>



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1920" height="1440" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-3.jpeg" alt="" class="wp-image-43892" srcset="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-3.jpeg 1920w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-3-1024x768.jpeg 1024w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-3-768x576.jpeg 768w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-3-1536x1152.jpeg 1536w" sizes="auto, (max-width: 1920px) 100vw, 1920px" /></figure>



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1920" height="1440" src="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-4.jpeg" alt="" class="wp-image-43893" srcset="https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-4.jpeg 1920w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-4-1024x768.jpeg 1024w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-4-768x576.jpeg 768w, https://sat-wp.afpc.tamu.edu/wp-content/uploads/2026/05/6.19.2-4-1536x1152.jpeg 1536w" sizes="auto, (max-width: 1920px) 100vw, 1920px" /></figure>



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Anderson, David. &#8220;<a href="https://southernagtoday.org/2026/02/05/cull-cow-prices-keep-climbing/">Cull Cow Prices Keep Climbing</a>.&#8221; Southern Ag Today 6(19.2). May 5, 2026. <a href="https://southernagtoday.org/2026/02/05/cull-cow-prices-keep-climbing/">Permalink</a>

Cull Cow Prices Keep Climbing

By Gracen Briges, Kelli Russell, and Mykel Taylor



In the first article of this series, we explored how farmers describe their relationships with lenders, identifying three general types: trusting and collaborative, strained and tense, and transactional and unstable. In the second article, we discussed the challenges that can disrupt or strain the farmer lender relationship. In this final article,&nbsp;we address the question of what qualities farmers value most in a lender. Many farmers emphasized that strong lender relationships can influence farm management decisions and reduce stress.



Through 74 interviews with 98 farmers and ranchers across four states (Alabama, Kansas, Montana, and North Carolina), producers consistently described important traits associated with a strong lender relationship. Farmers often described their lenders as partners, advisors, and collaborators who understand agriculture and support their operations&#8217; success. Several key traits emerged:



<ul class="wp-block-list">
<li>Lenders as partners and advisors</li>



<li>Open, honest communication and trust</li>



<li>A strong understanding of agriculture</li>



<li>Long-term and personal relationships</li>
</ul>



Lenders as Partners and Advisors



“The specific loan officer that we have, it&#8217;s almost like a partnership. Like he is aware of what we&#8217;re trying to do here.” &#8211; Alabama livestock producer



Farmers consistently emphasized the importance of having a lender relationship that is more than transactional and business. Lenders were described as partners and advisors who were willing to participate in planning, provide advice, and, at times, even challenge decisions. This collaborative approach makes financial decisions feel less stressful and supports the idea that the lender is invested in the farm’s success.



Open Communication&nbsp;



“I want to know how he feels about it. And I want to trust him. I mean, he was hard on us when he needed to be hard on us.” &nbsp; &#8211; Kansas livestock, row crops, grain, and forage producer



Open and honest communication was a defining trait of a strong lender relationship. Farmers valued lenders who were transparent. For many, trust developed over years of consistent, transparent communication. When lenders are responsive and approachable, farmers feel more confident discussing concerns and questions.&nbsp;



Understanding Agriculture



“And he [our lender] was great. Yeah. Because he grew up in the industry. He understood it.” &#8211; Montana livestock, row crop/grains, oilseeds and pulses producer



A lender’s understanding of agriculture was another key trait farmers noted. Farming presents a unique set of financial challenges, including seasonal cash flow, production risks, and volatile markets. Lenders who understand the dynamics are better able to provide advice and suggest solutions. This knowledge of agriculture&nbsp;<a>helps align financi</a>al decisions with the realities of the farming operation.&nbsp;



Long-term and Personal Relationships



&nbsp;“He [our lender] used to date my sister a long time ago. Oh, but we&#8217;ve been with Southern Bank for as long as I can remember.” &#8211; North Carolina row crops, grain, and specialty producer



Strong lender relationships are often built over time. Many farmers described working with the same lender for years or even decades, creating a sense of trust and consistency. These long-term relationships allow lenders to develop a deeper understanding of the farm and its goals, making communication more efficient and allowing for more goal-focused decisions. For many producers, these relationships extended beyond business, with some becoming personal friends outside of work. This familiarity reflects a deeper level of trust that strengthens the relationship.&nbsp;



Conclusion



A strong lender relationship does more than provide access to capital; it helps reduce stress and supports better financial decision-making. Farmers consistently value lenders who communicate openly, understand agriculture, and invest in long-term relationships. These qualities create partnerships that strengthen operations and support the farm&#8217;s long-term success.&nbsp;



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Briges, Gracen, Kelli Russell, and Mykel Taylor. &#8220;<a href="https://southernagtoday.org/2026/02/05/challenges-in-the-farmer-lender-relationship/">What Makes a Good Agricultural Lender?</a>&#8221; Southern Ag Today 6(19.1). May 4, 2026. <a href="https://southernagtoday.org/2026/02/05/challenges-in-the-farmer-lender-relationship/">Permalink</a>

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