Farmers are experiencing significant financial difficulties, exacerbated by the ongoing conflict in Iran. Experts indicate that rising costs for energy and fertilizer are compounding existing challenges for farmers, who are already operating on thin margins. Tariffs on imported metals and adverse weather conditions in regions such as California and Brazil are also impacting agricultural production. John Hansen, president of the Nebraska Farmers Union, described the current situation as the most challenging financial period for agriculture since the 1980s farm crisis.
The national average gas price reached $4.22 per gallon recently, up from $3.14 a year ago, according to the American Automobile Association. Wisconsin dairy farmer Linda Ceylor noted that her diesel costs have increased to $4.45 per gallon, adding to her operational expenses.
Experts warn that the conflict will lead to increased transportation and processing costs during the upcoming harvest season. Agricultural economist Ricky Volpe highlighted that higher energy and fertilizer prices are already affecting the planting and early growth stages of key crops, such as corn and wheat. He stated that these costs are unlikely to decrease, as growers cannot offset the financial burdens they are facing.
While many farmers secured their fertilizer supplies before the conflict began, those who did not are now struggling with higher prices and the need to refinance loans. Hansen reported that the stress levels among farmers have risen, leading to increased usage of crisis hotlines for mental health support.
Consumers are also feeling the effects of rising food prices, with the USDA predicting a 3.1% inflation rate for food in 2026. The food inflation rate reached 3.2% in April, reflecting ongoing economic pressures. Kenneth Foster, an agricultural economics professor, noted that many of the current food price increases were already anticipated before the conflict, although the war adds to the inflationary pressures. He estimates that a prolonged conflict could increase food inflation by 3 to 6 percentage points over the next year to year and a half, particularly affecting lower-income households.
Both Foster and Volpe agree that an end to the conflict could provide some relief for food prices, although the mechanisms behind current inflation differ from past crises.