FarmToFork Newsletter

The Farmers Digest

Fresh Food, Better Community

Greetings,

Week of July 20th • Presented by FarmToFork

Quick updates: The Farmers Digest hit 2,000 newsletter subscribers Thursday night, thank you for your support! Cofounder Chris Pigge recorded with bestselling Irish author Colman Power on his podcast "Colman Power," discussing our mission as well as sustainable and conventional farming issues.

U.S. Agricultural Trade Deficit Hits Record $49 Billion

America is heading toward a record $49 billion agricultural trade deficit in 2025—the largest in the nation's history. Agricultural exports have declined 13% since their 2022 peak while imports are projected to reach $219.5 billion, driven by demand for year-round fresh produce, coffee, and specialty foods. The U.S. maintained agricultural trade surpluses for decades until 2019, when it first recorded a deficit since at least 1967. Brazilian soybean exports to China have increased over 280% since 2010, while U.S. market share in China has stagnated amid ongoing trade disputes. Export-dependent corn and soybean farmers are facing pressure as some traditional export markets shift to alternative suppliers.

Fed Chair Uncertainty Affects Farm Lending Outlook

President Trump asked Republican lawmakers this week about potentially replacing Federal Reserve Chairman Jerome Powell, whose term expires in May 2026. Trump has called for immediate interest rate cuts and is reportedly considering appointing a "shadow chair" to counter Powell's policies. Market analysts warn that uncertainty around Fed leadership could affect financial markets and agricultural lending rates during critical planting and investment periods. If dramatic rate cuts are forced, long-term rates like the 10-year Treasury could rise as investors demand higher yields to compensate for inflation risks. Since many agricultural loans are tied to longer-term rates rather than the Fed's short-term rate, farmers could see borrowing costs increase even if the Fed cuts rates.

Pacific Northwest Faces Third Year of Catastrophic Drought

The Pacific Northwest is experiencing its worst drought conditions in decades, with 70% of the region now in moderate to extreme drought. Washington State has issued drought declarations for the third consecutive year, while Oregon and Idaho face similar water shortages. The Yakima Basin received only 45% of its normal water supply allocation for July through September. The drought is affecting crops that supply national markets, including wheat and apples. Commodity prices have risen in some sectors, potentially benefiting farmers outside the drought zone. Regional producers are weighing difficult decisions between maintaining crops with limited water or reducing planted acres.

ICE Raids Spark Chaos at California Cannabis Farms

Federal agents executed criminal search warrants at Glass House Farms cannabis facilities in Camarillo and Carpinteria this week, resulting in 319 arrests and one death. The raids uncovered at least 10 unaccompanied undocumented children working at the cannabis operation. Jaime Alanis Garcia, 57, fell 30 feet from a greenhouse roof and died Saturday from his injuries after breaking his neck and skull. The operations turned violent when protesters threw rocks and bricks at federal agents, who responded with tear gas and less-lethal weapons. According to Homeland Security Secretary Kristi Noem, immigration officers faced "assaults, violence, and even bullets fired at them." The FBI is offering a $50,000 reward for information about someone who fired a pistol at federal officers. California agriculture relies heavily on undocumented workers, with industry estimates suggesting nearly half the agricultural workforce lacks legal status.

Market Breakdown

Live cattle prices reached historic levels this week, with northern regions commanding elevated prices as packers bid aggressively to secure adequate cattle supplies. Weekly slaughter increased to 568,000 head—up dramatically from the holiday-shortened previous week, though still trailing last year by 37,000 head. Feeder cattle markets showed significant gains, with steers and calves posting notable increases. Current cattle pricing reflects tight supply conditions and strong demand from processing facilities. Packing plant margins have been under pressure due to high cattle costs relative to beef prices.

The ongoing tariff disputes have led to significant changes in U.S. agricultural trade patterns. China has reduced U.S. agricultural purchases, with hay exporters reporting Chinese customers canceling orders with two weeks' notice despite vessels already being booked. Soybean exports to China now face 71.5% total tariffs while cotton exports encounter 74% barriers. Agricultural exports have declined from their $196 billion peak in 2022 to a projected $170.5 billion in 2025. Brazil has increased agricultural shipments to China, with a record $60 billion in goods representing nearly a quarter of China's total farm imports.

Corn futures faced downward pressure this week, with both September and December contracts declining as export demand fell below analyst estimates. Brazilian safrinha corn continues showing strong yields that could impact U.S. export competitiveness. Soybeans demonstrated more resilience, posting modest gains during the week. A recent trade development with Indonesia generated fresh export optimism, while EPA's proposed biofuel blending requirements for 2026-2027 could significantly boost soybean oil demand with increased biomass-based diesel mandates. Fertilizer markets showed mixed movements, with UAN32 reaching levels not seen since May 2023. Seven major fertilizers now cost more than year-ago levels, with UAN32 and urea both showing significant annual increases.

Sources:

Getting Started with Cattle: A Beginner's Guide to Understanding the Basics

Learn the fundamentals of cattle farming with this comprehensive beginner's guide. Understand cattle terminology, behavior, nutrition, infrastructure, and marketing options for successful livestock operations.

Essential Estate Planning Documents: What Each One Actually Does

Understanding estate planning documents for farming families. Learn about wills, trusts, powers of attorney, and business succession planning to protect your farm and family.

LLCs for Farmers: Structuring Your Operation for Success

Learn how Limited Liability Companies can protect your farm assets, reduce taxes, and facilitate succession planning. Expert guidance on business structures for modern farming operations.

Sole Proprietorships for Farmers: The Default Choice

Learn about sole proprietorship as the default farm business structure. Understand the benefits, risks, and tax implications of this simple farming business setup.

Thank you for reading this week's newsletter and helping us grow. For any criticism, questions or comments feel free to reach out to me at:
chris@farmtofork.life

Have a great week!

Iowa City, Iowa