Overview
Growing concerns over sharply higher input costs tied to the U.S.-Israeli conflict with Iran and persistent weakness in grain prices have prompted U.S. growers to reconsider planting plans for the coming season, analysts say. Preliminary estimates compiled ahead of the Department of Agriculture's prospective plantings report indicate fewer acres will be devoted to corn, spring wheat acreage will likely fall to multi-decade lows, and soybean seedings are expected to increase as farmers respond to changing economics in the field.
Survey timing and market skepticism
The USDA is scheduled to release its annual prospective plantings report on Tuesday at noon ET (1600 GMT), the first officially surveyed view of intended crop acreage for the year. Analysts caution the survey, which drew on farmer responses collected in the first half of March, may not fully capture the subsequent cost and supply disruptions set off by the conflict that began when the United States and Israel launched airstrikes across Iran on February 28.
Terry Linn, an analyst at Linn & Associates in Chicago, said the market is likely to treat the planting intentions data with caution because the timing of the survey coincided with the war's outbreak and the rapid escalation in input costs. "This particular planting intentions report, right out of the gates, is going to be viewed somewhat skeptically by the trade just because of the timing of the survey with the start of the war and how things have changed in terms of costs," he said.
Analysts' acreage projections
Analysts polled by Reuters on average forecast U.S. corn plantings to fall to 94.371 million acres, down from 98.788 million acres in 2025. Soybean seedings were projected to increase to 85.549 million acres from 81.215 million a year ago. Spring wheat plantings, concentrated in the northern Plains, were expected to drop to 9.843 million acres from 9.990 million last year, a level that would be the smallest since 1970.
The anticipated decline in spring wheat acreage follows a sharp fall in prices for the high-protein grain after a record Canadian harvest last year. Those price pressures have made the crop less attractive for growers in its core producing regions.
How costs are shifting crop choices
Profit expectations and input expenses are key determinants of whether farmers adhere to traditional rotations, typically alternating corn and soybeans in the Midwest to preserve soil health and maximize yields. When fertilizer and fuel costs rise relative to expected outputs, producers may deviate from those rotations and alter acreage choices on some fields.
Rich Nelson, chief strategist with Allendale, pointed to fertilizer cost and availability as the principal drivers behind acreage shifts. "The fertilizer cost and fertilizer availability are the main drivers right now," he said. "But I would point out that we have questions about whether the USDA's report will show the true story."
Economists at the University of Illinois reported that prices for urea fertilizer are roughly 40% higher since the start of the conflict and that anhydrous ammonia costs are up nearly 20%. Because soybeans generally require less nitrogen fertilizer than corn, those increases in nitrogen fertilizer prices could encourage farmers to put more acres into soybeans and pull back on corn plantings, the economists said.
U.S. Agriculture Secretary Brooke Rollins this month estimated that about 75% of farmers already had their fertilizer needs booked, a figure officials have cited in discussions about how sustained input cost pressures might affect planting decisions.
Fertilizer sourcing and alternatives
Most widely used ammonia fertilizers are synthesized using natural gas, which links fertilizer prices to energy markets. The current surge in input costs has accelerated efforts to find alternatives that would both reduce exposure to natural gas price swings and lower carbon intensity in production.
In Minnesota, a coalition of agriculture and conservation organizations launched the Minnesota Made Ammonia project on March 5 to pursue local ammonia production facilities powered by renewable energy, according to a statement from the group. Proponents argue such projects could help insulate farmers from global price volatility, although the initiative's prospects and scale remain framed by the limited information provided in participants' statements.
Regional planting shifts and alternative crops
Outside the Midwest corn and soybean belt, growers have more options and may pivot toward crops such as hard red spring wheat, durum wheat, canola and cotton depending on local conditions and relative returns. In North Dakota, analysts expect that higher fertilizer costs and continued trade uncertainty could lead some farmers to favor corn or canola over soybeans and spring wheat. North Dakota is a leading spring wheat state and supplies soybeans that move to China through Pacific Northwest ports.
Jim Peterson, executive director of the North Dakota Wheat Commission, noted the steep increase in urea prices since the conflict began. "The price of urea fertilizer has jumped at least $200 per ton since the start of the war," he said. Peterson explained that, on typical yields, growers need a higher grain price to offset those added input costs: "On a 50 bushel (per acre) wheat yield, you need another 40 or 50 cents a bushel to just cover that cost."
Canola, which is produced in the northern Plains and neighboring Canada, remains a viable option despite elevated fertilizer expenses due to robust demand for vegetable oil used in biofuel production. The article's reporting notes that demand for biofuels has risen as prices for petroleum-based fuels climbed, supporting stronger returns for oilseeds relative to some other crops.
Delta region and cotton
In the Delta, analysts expect low cotton prices combined with higher input costs to push cotton plantings toward their lowest level in a decade, as growers consider shifting ground into soybeans where returns may be more attractive. Barry Bean, president of Bean & Bean Cotton Company, said that if soybeans continue to look substantially stronger through March and into April, acreage will likely move from cotton to soybeans.
Government aid and farm income outlook
Despite near-record government payments to crop producers, forecasters expect U.S. net farm income to decline this year, reflecting the fourth consecutive year that crop farmers face tight margins driven by high production costs and low commodity prices. The Trump administration has been distributing $12 billion in aid to U.S. farmers, and farm groups have urged Congress to consider further assistance as the economic fallout from the conflict reverberates through agricultural supply chains.
Market and policy uncertainties
Beyond input cost volatility, long-term trade questions continue to cloud planting decisions. The article notes lingering uncertainty over the U.S. trade relationship with China amid the trade dispute initiated by President Donald Trump’s administration with the top soy importer. That ongoing tension complicates planting choices for soybeans, which rely heavily on export demand for market clearing.
Conclusion
Farmers are entering the critical spring planting window amid an unusual convergence of geopolitical disruption, sharply higher fertilizer and diesel costs, and muted grain prices. Analysts' pre-report projections point to a rotation in acreage away from corn and spring wheat and toward soybeans, but questions remain about how accurately the USDA's survey captured the rapid shifts in economics since the conflict began. Efforts to diversify fertilizer sourcing and expand renewable-powered ammonia production are underway, but how those initiatives will influence planting decisions this year is unclear based on the information available.
Key data points repeated for reference
- Analysts' average projection for U.S. corn plantings: 94.371 million acres (down from 98.788 million in 2025).
- Analysts' average projection for U.S. soybean seedings: 85.549 million acres (up from 81.215 million a year ago).
- Analysts' average projection for spring wheat plantings: 9.843 million acres (down from 9.990 million, the smallest since 1970).
- U.S. government aid in distribution: $12 billion.
- Estimate of farmers' fertilizer booked: about 75% (U.S. Agriculture Secretary).
- Reported fertilizer price moves: urea up about 40%, anhydrous ammonia up nearly 20% (University of Illinois economists).
- Reported urea price increase in North Dakota: at least $200 per ton since the start of the war (North Dakota Wheat Commission).