High fertilizer prices could reshape US planting decisions in 2027 – USDA

High fertilizer and fuel prices could affect the US crop mix in 2027. USDA Chief Economist Justin Benavidez warns that rising production costs are putting increasing pressure on US farmers’ margins and could prompt them to reconsider which crops to plant next season.

One of the key factors has been shipping disruptions through the Strait of Hormuz, which normally handles around one-third of global seaborne fertilizer trade. Disruptions along this route have also supported higher energy prices, adding further pressure to agricultural production costs.

Even after shipping fully resumes, fertilizer supplies will not return to normal immediately. According to USDA, it could take 4–6 months for shipping to return to normal. US farmers could therefore face elevated costs during fall fertilizer applications, potentially influencing planting decisions for the 2027 crop.

Meanwhile, US wheat production in 2026 is at historically low levels due to reduced acreage, lower yields and increased crop abandonment. This is supporting domestic wheat prices but at the same time making US wheat less competitive on the global export market.

The outlook for corn and soybeans is more favorable due to strong demand. Corn is supported by active purchases from Mexico, while the renewable fuels sector is generating additional domestic demand for both corn and soybeans. USDA notes that amid high production costs and intensifying global competition, US farmers are finding it increasingly difficult to rely on higher agricultural commodity prices alone to improve profitability.

Tags: USDA, planting, prices, soybean, farmers, fertilizers, Hormuz, corn