2025 4th Quarter Ag Outlook
- Grant Wiese
- Sep 29
- 5 min read
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2025 4th Quarter Ag Outlook
It is time for our quarterly ag outlook. Enjoy!
Interest Rates
The Fed decreased rates .25 bps last week and odds are for two more .25 bps rate decreases before the end of the year. (Source: CME FedWatch Tool – CME Group)
There are two conflicting arguments which are currently battling it out:
1. On the one side is the jobs report. The U.S. has not been creating new jobs and unemployment is on the rise. There is major concern that the U.S. economy is stalling which is incentive to lower interest rates to hopefully spur on business. Live updates: America’s job market flashes yet another warning sign about the economy | CNN Business
2. The opposing force is our old nemesis: inflation. It has been sticky and is not coming down. If the Fed decreases interest rates too fast, we could see an uptick in inflation again. Putting us right back where we were a few years ago and creating a need to quickly increase interest rates. PCE inflation August 2025:
The Fed is stuck between a rock and a hard place. However, I would like to remind you the Federal Reserve does not answer to or do the President’s bidding. It is their job to protect the economy. I hear from farmers all the time that Trump will get interest rates lower. He doesn’t have control over the interest rates or the Federal Reserve. Their interest rate decisions should not have an agenda attached to it.
10 year treasury bonds are around .20% lower than where we started the year, now at 4.70% (Source: Resource Center | U.S. Department of the Treasury). These has been a recent downtick in September, making land/housing purchases a little more affordable.
The farm (and commercial) economy REALLY needs rates to move down immediately and stay there for the next 6 months. The reason this is so important is because all the 2020 5-year low interest rates loans are repricing this year. Producers have tight cash flows today. They REALLY won’t like their cash flow once their land note reprices from a 3% interest rate to 7% interest, doubling the amount due next year. Without long-term rates lowering, we will see more land and commercial properties coming up for sale in the short term.
Land Prices
Early land sales and listings have been strong. Expect top quality ground to maintain its value and stay within 10% of the local highs. Depending on the amount of ground up for sale within a specific concentration, expect poorer quality ground to be off more from their highs. There still seems to be outside investor interest, which should help.
Talk of government payments makes negotiating land rent lower very difficult, despite the negative margins many are facing. Many rent conversations won’t take place until the conclusion of harvest. In my experience, landlords are often delayed in realizing when prices are moving lower and asking too much when putting out properties as a listing.
Yields
I only can speak for my very specific area. Nebraska yields appear to be above average. We went through a dry August, but heat was not overly excessive. That heat seemed to help the soybeans and there are some very strong yields on dryland acres. I didn’t hear of much sudden death or widespread disease in the beans.
Corn acres were nicked up with various wind and hail events, but the damage wasn’t widespread. Ears seemed to have filled out well and we will have to see what test weights look like. Just like in 2024, if you didn’t spray fungicide on the corn you could experience a 10-40 bu/a yield loss from southern rust and tar spot.
My understanding is that disease and drought damage were much higher in the ‘I’ states. However, I won’t speculate on their yield at this time. Just hoping for the best for them.
Equipment Prices
Dealerships are filling up, unable to move high HP equipment. It will be interesting to see if they push some lease deals again going into this fall to get equipment moving. Used equipment is moving quite well through auction and private party transactions.
Farmers knew their 2025 cash flow projections were negative, making it an easy choice to bypass any purchases until they see improvement margins in the crop again.
Operation Improvements
So many grain bins! While equipment hasn’t been moving, bins are going up all over. With poor commodity prices, farmers are planning to pack even more grain away and ‘hope’ we get back to some seasonal spring rallies.
Commodity Price Direction and Marketing
This one hurts. I hear rumblings that many producers are 10% sold for their 2025 crop being harvested this month.
Yes, it looks like the high yield estimates may have topped out and many are saying, “we can only go down from here”. You must be prepared if national yields don’t go down any further. If we go into the 2026 growing season with a +2B bu carryout, then prices absolutely can go lower and stay there for the entire year. Get some sales in. Get some targets in place. Work with a marketer. Have a plan. Stick to the plan. Please do something.
Weather
I get my weather updates from Eric Snodgrass with Nutrien Ag Solutions, you should sign up for his e-mail, eric.snodgrass@nutrien.com, and check out his videos here: Sep 25, 2025: Tropical Risk Increases for Carolinas | Very Dry Rockies to Appalachians ...
Long term forecasts are showing dry and favorable weather conditions for a speedy start to harvest.
Working Capital Trend
This is the $1M question. Were operations able to stem the bleeding and stabilize working capital? Or will this be the 3rd consecutive year of steep losses, pushing operations closer to an illiquid position. I will have a big update on this at our ’26 1st Quarter Outlook.
Early pricing on 2026 nitrogen has not been good, with many producers telling salesmen to ‘get lost’ until they can come back with a lower price. Seed prices are expected to be similar to 2025 figures.
Who I follow
I’m adding a new section here to give you access to resources that I believe can help your operation. I highly recommend you follow Joe Vaclavik on Twitter: @StandardGrain. He gives free marketing content daily at 5am, covering the most important topics that could impact your operation. He is very knowledgeable and efficient with your time. Home - Standard Grain
Overall Financial Picture
I’ve heard of a bank sending letters out to farmers, letting them know they won’t be renewed for an operating note for next year. This matches a similar approach that I saw in 2019, with banks pruning their balance sheet and getting out of their most risky accounts. 2019 was the bottom of the last downturn. We don’t know when the bottom will hit this time.
Make changes where you can. Try something new to improve margins without breaking the bank. Talk to experts to become a better farm manager. Many 2025 cash flow projections built last winter were negative, and that was with $4.50 cash corn projections. Higher fertilizer prices, lower commodity prices, and another year of wear on equipment means we need to be very cautious and risk off on our approach forward.
Final Summary
Every operation is different and needs alternative advice compared to their neighbor. Nothing mentioned above is a one size fits all approach. While I hope this is helpful, what is better for your operation’s well-being is to update your own financials, run them by a trusted financial advisor, make your own plan for the upcoming year, and adjust that plan when necessary.
If you want that financial advisor to be me, you can book me here:
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Have a great week!
Grant
