From WisPolitics:
“We’re going to come out and your fertilizer prices are going to go way down just like they were four months ago. Your fertilizer’s down, your energy’s down, your oil, your gas is all coming way down. And frankly, I thought it would go much higher than it did,” Trump said during the visit, his first in Wisconsin of his second term.
So far, the situation has not been improving during the course of the war:
Figure 1: Ag Econ Barometer index (blue, left scale), log ratio of world price of agricultural commodities over fertilizer (red, right scale). NBER defined peak-to-trough recession dates shaded gray. Orange shading denotes Trump administrations. Source: Purdue/CME, World Bank, NBER, and author’s calculations.
Is it likely to improve soon? Here is the current betting on reopening by September 1, October 1, and January 2027.
Source: Kalshi, accessed 6/6/2026.
The prediction markets are suggesting non rapid resolution.
Not only have input costs risen as commodity prices fallen or stagnated, export opportunities have been further restricted after the closure of the Strait of Hormuz (WisPolitics):
Also on the call, Menomonie kidney bean farmer Cindy Brown said exports are a major part of her business and tariffs have hit them hard. She said Chippewa Valley Bean can’t ship to customers in Dubai amid a blockade in the Strait of Hormuz and that freight costs have increased.
“There’s no clear end in sight right now and the longer this goes on, the more money farmers lose and the darker the outlook becomes,” Brown said.
Preliminary March figures for Wisconsin nonmanufactured exports are out, but April data will only be released June 9th.
In light of the low likelihood for a rapid reduction in oil and fertilizer prices, and the reduced export revenue, it seems likely that Trump will return to buying off farmers with another dollop of federal funds (ProgressiveFarmer):
Trump touched on trade wars in his first administration, pointing to the $28 billion that went to farmers under the Market Facilitation Program (MFP). Trump then said his administration was looking at another payment program, coming off the $11 billion paid in March and April under the Farmer Bridge Assistance (FBA) payments. “We’re looking at increasing it,” Trump said.
USDA Economic Research Service forecasts direct government support for 2026 at 44.3 bn 2026$, up from 30.5 bn in 2025 (and $10.1 bn in 2024). I don’t know how ERS comes up with this particular forecast in the absence of legislation to authorize and appropriate (there being no five year budget in place).
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