The USDA projects the 2025/26 marketing year average farm price for corn at $3.90 per bushel, down 30¢ from last month's estimate. For many growers, that dip signals shrinking cash flow and tighter credit conditions at a time when input costs and land rents remain high.

Farm CPA Paul Neiffer warns that in the short term, two realities dominate: heavier reliance on government payments and more difficult conversations with ag lenders.

Government Payments: A Safety Net with Delays

For every 10¢ decline in corn prices, U.S. producers can expect about $1.2 billion in government program payments, Neiffer explained. His estimates suggest about $15 billion in ARC and PLC payments could reach farmers in October 2026.

While this relief is substantial, the lag in disbursement leaves farmers exposed during the marketing year. Neiffer emphasized that higher yields could soften the blow: "If farmers bring in an extra 20 to 40 bushels per acre, even at $4 corn, that adds up to meaningful cash receipts."

Still, he noted the possibility of additional Market Facilitation Payments, particularly if trade disputes reignite.

Landowners vs. Renters: Uneven Resilience

Not all producers face the same risks. Neiffer stressed that farmers who own their land are positioned far better than those renting 70% to 90% of their acres. This mirrors patterns seen in the 2014-2019 downturn, when tenant-heavy operations struggled most.

Data from the 10th District Federal Reserve backs this up: 60% of lenders said owner-operators' finances remain modestly stronger than renter-operators, who lack equity to leverage against declining profits.

Bankers Tighten the Credit Spigot

With credit demand rising and repayment rates slipping, rural banks are under pressure. Neiffer urges farmers to approach lenders with transparency:

• Be upfront about financial realities

• Share a clear operating plan

• Stay realistic about viability

He cautions that delaying hard decisions can turn equity losses into bankruptcies.

A recent provision in the One Big Beautiful Bill Act allows banks to reduce the taxability of interest income, potentially lowering borrowing costs by 20-25 basis points. Still, Neiffer says this offers limited relief and primarily benefits loans with commercial banks rather than Farm Credit institutions.

Crop Struggles vs. Livestock Strength

Despite tightening crop margins, the livestock sector remains profitable, supporting many rural banks. Yet Federal Reserve reports show farm income and loan repayment rates continuing to decline steadily across the 10th District.

"If prices stay low into 2026, more rural banks could start feeling the squeeze," Neiffer warned.

For now, U.S. corn farmers must balance government support with realistic financial planning. Strong landowners and livestock producers may weather the storm, but renter-heavy row crop operations remain the most vulnerable if low commodity prices persist.