KDJ_Farm Special_031426

FARM

Farm economy enduring a generational downturn

The latest federal farm income forecast reinforces the difficult reality for U.S. agriculture.

Net farm income is projected to edge lower in real terms, cash receipts from commodity sales are generally expected to decline, production costs remain historically high and farm debt continues to rise.

The U.S. Department of Agriculture predicts net farm income will slip lower in 2026 and remain roughly $48 billion, or 24%, below the record highs reached in 2022 — underscoring a generational downturn in the farm economy.

broad improvements in market conditions.

Looking ahead to 2026, modest gains in cash income come alongside continued cost pressure, rising debt and tightening liquidity.

While commodity receipts are expected to soften for many products, elevated production costs continue to push breakeven prices higher, limiting farmers’ ability to rely on the marketplace alone.

Taken together, the outlook suggests a farm economy being stabilized by short-term support rather than strengthened by durable market recovery.

or resolve the underlying financial strain many farmers face.

Farmers need stronger market returns, so income comes from selling commodities, not aid — and that means improving the farm safety net through a fully passed farm bill, strengthening trade demand and addressing rising input costs.

Without stronger markets and a more predictable, effective safety net, uncertainty will continue to shape farm-level decisions heading into the next production year.

CATTLE HERD CONTINUES TO SHRINK

At the same time, USDA’s sharp downward revision to 2025 revenue — cutting net farm income by roughly $25 billion — underscores that last year’s anticipated rebound was weaker and more fragile than previously believed, shaped heavily by the timing of disaster and economic assistance rather than

USDA estimates net farm income at about $153 billion in 2026 and about $1.2 billion down from last year’s revised number. Production expenses are set to reach a record level at $477.7 billion.

Livestock receipts are expected to decline $17 billion. Crop receipts are expected to stay about even, but are still below break-even prices for farmers.

Existing federal assistance remains critical in the near term, but it does not close the gap between costs and returns

USDA’s new Cattle Inventory report confirms the U.S. beef herd remains in the contraction phase of the cattle cycle with little opportunity for meaningful expansion until at least 2028.

Declines in beef cows and the calf crop underscore just how tight supplies have become, even while modest increases in replacement heifers suggest farmers and ranchers are cautiously considering rebuilding.

The report shows the cattle inventory on Jan. 1 at 86.2 million head — down

300,000 head, or 0.3%, from 2025.

In the short run, fewer calves, limited feeder cattle availability and restricted live cattle imports will continue to constrain cattle markets.

These fundamentals have translated into historically high prices and pronounced volatility across both cattle and beef markets.

Strong consumer demand has allowed higher prices to persist — offsetting broader weakness in the agricultural economy and making beef cattle one of the few bright spots in agriculture.

Looking ahead, cattle producers still face substantial uncertainty that clouds herd rebuilding decisions.

Ongoing animal health threats, including New World screwworm, along with the potential for another severe drought year, continue to raise costs and production risk despite strong underlying demand.

James Henry is the executive editor of Illinois AgriNews and Indiana AgriNews.

RICH HANSEN

Designated Managing Broker Licensed in Illinois and Indiana

I WOULD RATHER BE ON MY FARM THAN BE EMPEROR OF THE WORLD. “ “

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FARM

Boost soil health with cover crops

By MARTHA BLUM mblum@shawmedia.com

SYCAMORE, Ill. — Regenerative agriculture is about mimicking nature’s principles, designs and patterns.

“It is not more difficult than that, put more ecology into your conventional system, more cover crops and stop disturbing the soil so much,” said Ray Archuleta, soil health specialist and founder of Understanding Ag LLC and the Soil Health Academy.

Archuleta has been on thousands of farms all over the wo-rld.

“The best thing we can do for compaction is plant a living cover that leaks acids and feeds the microbes,” he said. “I want fibrous roots leaking acids on every square inch because that is what changes clay soils and sandy soils.”

Plants capture light energy and move that energy into the root system.

“Most farmers are not feeding the microbes enough,” Archuleta said. “These micro cows are protozoa that are grazing around and eating bacteria.”

The fungi run the underworld, the soil scientist said.

“They release the nitrogen and bring the phosphorus and trace minerals,” Archuleta said.

“In the last 26 months, I have been on six continents and I’m going to share with you things that are common problems on a global scale,” he said during a presentation at the 2026 Conservation Cropping Seminar, coordinated by the Illinois Department of Agriculture, Illinois Environmental Protection Agency, U.S. Department of Agriculture’s Natural Resources Conservation Service, and Champaign County Soil and Water Conservation District.

The soil scientist has been to every state in the United States, as well as Puerto Rico, and he stresses that soil is alive.

“That is the No. 1 issue I have with producers globally — they think it is dirt,” he said. “If you don’t get the soil right, nothing else works.”

A tiny change can make a big difference in a biological system.

“Things are so connected that one little thing you do on your operation has a huge outcome,” said Archuleta, who has been working with soil health principles for 30 years.

“That’s why I love providence versus fate — fate is blind and providence is divine,” he said.

For example, Archuleta said, if a livestock farmer moves his cattle or sheep one more time in a pasture rotation, that can make a significant change in the operation.

“We cannot predict biological systems,” he said. “There is no soil test in the world that will predict your soil because it is too elegant and complex. A soil test gives you a snapshot — do not expect any more.”

Archuleta had been planting cover crop mixes since 2007.

“Nature is never na-ked,” Archuleta said.

“The more fungi you bring into the system, the weed population begins to shift because weeds love bacteria-dominated soils,” he said.

“As the soils become more fungal, the forms of nitrogen shift to a more organic form, so I want more fungal dominance; I don’t want bacteria-dominant soils.”

“With tillage, you are disrupting all the workers, that’s why I love notill because a disk destroys the house,” Ar-chuleta said. “I’m not saying don’t use tillage, but use it wisely because it is a destructive tool.”

It is important for all farmers to know their context.

“Are you farming here or are you farming in New Mexico?” the soil scientist questioned. “The context changes, but the principles do not; they work in Brazil or in Europe.”

When Archuleta visits the farm, the first tool he uses is a shovel. He will take a soil sample from a fence row and have that sample evaluated with a Haney test.

“I want to get a benchmark condition of your operation before you start making decisions,” he explained.

“The Haney test is useful because it measures nitrogen in the organic form and all the amino acids,” he said.

Archuleta encourages farmers to be scientists and do their own research.

“Farmers don’t do their own research because they lack the margin,” he said.

The soil scientist works with innovators that are changing the community.

“We’re helping the soil to provide its own fertility using microbes,” he said. “We’re learning how to make the biology more active in the soil with cover crops, no-till and by growing your own biologicals.”

FARM

Former first responder responds to UAV need

By TOM C. DORAN tdoran@shawmedia.com

GIFFORD, Ill. — After spending 30 years as a paramedic and volunteer firefighter, Dave Burt “retired and got bored,” when an event in his area gave him an idea that sparked a new business.

“Someone’s pet went missing in our area. They brought in a company from as far away as Ohio to search for the pet using a drone. I’m like, ‘there wasn’t anybody close?’” he said.

Burt and his wife, Bethany, decided to fill the need for unmanned aerial vehicle services and started the process to open their own business.

“I went through the process to get my certification and to fly drones commercially and then built up the business from there,” he said.

Bethany is president and operations manager, and he is operations manager and certified Part 107 remote pilot of From Above Aerial Imagery, a business in Mahomet in east-central Illinois that began operations this past November.

From Above Aerial Imagery was among the new businesses with a booth at the Midwest Ag Expo.

With deep roots in central Illinois and decades of combined experience in public safety and management, From Above Aerial Imagery uses advanced drone technology to provide clear, actionable perspectives from above — helping farmers, homeowners, businesses, utilities and first responders make informed decisions.

The firm’s UAV services include precision agriculture, search and rescue and emergency support, inspections and infrastructure, renewable energy inspections, 3D mapping and modeling, and real estate aerial photography and video.

Precision agricultural services include crop monitoring.

“We’ll fly the field, take the photos, plug it into our software, we’ll stitch it all together, and it’ll tell you if there are any issues and give stand count reports,” Burt said.

“We want to be able to provide a service to the farmers at an affordable cost.”

“If there are any issues, we use a variable rate applicator calculator that I’ll be able to figure out how much they need to use and how much it’ll cost them.

Dave Burt FROM ABOVE AERIAL IMAGERY

“Once we’re done with all that, we’ll send the files over to the farmer, and if they’ve had any problems, then they’ll be able to address them.”

The imagery will be able to spot problems in specific locations in the field, ranging from nutrient deficiency to pests to drainage problems at the back of the field.

“It saves the farmer time from actually physically walking the whole field versus I’ll just send the drone up and fly the whole field, take the imagery, then they can review it themselves and go from there,” Burt said.

The UAV has real-time kinematic precision mapping capabilities with accuracy down to a centimeter.

“When I’ve set up the mission into the controller, it’s through Google Maps, so I’ll be able to plot exactly the precise area around the field and it’ll just take that area that I’ve set up for. That’s how precise it’ll be,” Burt said. “They recommend about 200 to 250 feet to gather the imagery.

“We don’t even have to take pictures. We have the capabilities for live feed if the farmer wants to be there and just wants to take a look at something in the field. We can set that up. He meets us out to the field, we’ll fly and take a look at it, and he can look for himself.”

The services are not limited to east-central Illinois.

“We want to be able to provide a service to the farmers at an affordable cost without breaking the bank for them to find out if there’s a problem and the solution to fix it,” Burt said.

Dave Burt (left) and Justin Slade were at the From Above Aerial Imagery booth at the Midwest Ag Expo near Gifford in east-central Illinois. Burt is the company’s operations manager and certified Part 107 remote pilot, and his wife, Bethany, is president and operations manager. Slade has seen the benefits From Above Aerial Imagery provides for farmers.

Justin Slade, a friend and associate of Burt who works for a farmer near Sadorus, was at the Midwest Ag Expo booth and has seen the benefits of the services.

“That’s kind of how we got into the precision ag side of it because we’re always looking for different ways. He’s got the capability and we’re looking to integrate it into our farm,” Slade said.

“He’s able to do a little bit of everything. He does cell towers, wind towers, you can do building inspections, for instance, if you have an old crib or something like that and you don’t want to climb up and check the roof — he can do that.”

“For anyone who has livestock they want to keep track of, we can fly over and check out the livestock for them. We can also look at the bins to see if

there’s any problems with them. We’ll tailor it to your needs,” Burt said.

EVER-EXPANDING

The capabilities of UAVs continues to expand.

“It just seems like every day when I do my due diligence and research on drone technology, there’s a new use for it that comes out,” Burt said.

“We offer search and rescue. We assist public agencies if they become overwhelmed should there be a disaster. We can use it to help with that.

“In the event of possible crop damage due to hail, for example, that may or may not be in an area of the field easily accessible, we can take images to assess the damage and send it to the farmer’s insurance company to file a claim.”