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Arkansas farmers face critical year as multi-year losses, high costs threaten profitability

The CEO of AgHeritage Farm Credit Services says multiple years of losses, high input costs and ongoing global uncertainty means farmers in Arkansas face a critical year ahead.

“This is the worst I’ve seen since the mid-1980s from a profitability standpoint.”

Greg Cole says all crops had losses this year, especially rice and cotton, and many farmers are running out of lendable equity.

“This past year, we’ve had around 70 farm equipment sales in eastern Arkansas.”

The loan renewal season is underway. Cole tells Brownfield many farmers should be able to farm again in 2026, but it’s not going to be easy. He says it will be challenging for beginning farmers and older generations.

“There are farmers in their tenured years of farming, maybe in their 60s. They don’t have a succession plan or someone to come back to the farm. And with these losses and the outlook not looking any better, some might choose just to retire.”

He says survival will depend on expanding markets for crops and government support, but the situation is fluid.

“Our average loss coming into 2025 was $150 an acre, and receiving that ECAP payment from the USDA gave farmers about $50 (an acre). Our pre-government intervention last winter was $200 an acre, and we’re still seeing losses this year.”

He says farmers are using all tools available to restore profitability or reduce losses.

“Looking on the market side, with the soybean uptick recently, maybe there’s some opportunity there, but farmers are also having to pull other levers. We as lenders encourage cutting any unnecessary expenses, discarding non income producing assets, delaying capital, capital purchases and looking at land rental structures.”

Cole says there might be fewer farmers on the other side of this cycle in agriculture. However, the farmers who do survive will be better managers and will likely have larger farms.