A new report shows net farm income in Iowa dropped by 53% between 2022 and 2024. The Iowa Farm Bureau Federation, Iowa State University and the Iowa Bankers Association commissioned the study.
Iowa State University ag economist Chad Hart said unlike the Farm Crisis of the 1980s, farmers aren’t carrying as much debt and the value of farmland is very strong, but farmers are facing a cash flow problem. “Sort of the idea that, ‘I’ve got a lot in my retirement account, but my checking account’s fairly low right now, so I’ve got a lot of value, but I can’t really access it to pay my bills,’” Hart said. “That’s the situation we’re finding ourselves in now.”
The report found that by the end of last year, nearly 20% of large and mid-sized farming operations in Iowa were financially vulnerable. Christopher Pudenz, an Iowa Farm Bureau economist, said the financial pressure is mounting. “If you don’t have enough money in your checking account year after year after year, eventually the wise thing to do is to tap into your…assets…That could lead to insolvency,” Pudenz said, “so it could lead to more bankruptcies.”
Some of the banking approaches that help financially stressed farming operations were developed after the Farm Crisis and Pudenz suggested the push to expand foreign markets for ag commodities helped revive the farm economy in the 1990s. “Long-term multilateral trade deals are a very effective way to increase farm incomes,” he said. “…The current approach to trade policy seems to be backtracking on that particular lesson that we learned after the ’80s.”
The USDA has not yet released its final report on farm income data for 2025. Pudenz said the estimate showing a slight increase in net farm income last year is almost entirely due to booming livestock prices and federal payments to farmers. “(Another round of federal payments worth) $11 billion is enough to make a difference, but it doesn’t fix the fundamental market issues that we’re dealing with,” Pudenz said, “which is our soybean trade portfolio is vastly different than what it looked like a few years ago.” And he citeed an estimate from Iowa State University’s Center for Agriculture Research and Development — that ethanol production will only grow by 8% percent over the next 25 years.
The report shows since 2021 the cost of producing corn increased 37%, but corn prices are lower today than they were five years ago.
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