US farmers face worst crisis since 1980s as Iran conflict drives up diesel and fertilizer costs

Farmers across the Midwest are entering planting season under mounting financial pressure as the Iran conflict drives up diesel and fertilizer prices, deepening an agricultural downturn that some say is the worst since the 1980s farm crisis.

Mark Mueller, a northeast Iowa farmer and president of the Iowa Corn Growers Association, told Axios the current landscape is more challenging than at any time since the 1980s farm crisis, when interest rates soared and exports plunged, triggering agricultural bank failures. "There's going to be fewer farmers next year than there is this year," Mueller said.

Diesel averaged $5.67 per gallon as of May 14, up 60% from a year earlier, according to AAA. The spike is largely attributable to the shutdown of the Strait of Hormuz amid the Iran conflict. Meanwhile, 70% of farmers cannot afford the fertilizer they need, according to the American Farm Bureau Federation.

Cornell University agricultural economist Wendong Zhang said: "What makes this moment particularly hard is that farmers can't pivot quickly. Farmers have some tools, but none are quick fixes."

In Ohio, first-generation farmer Michael Kilpatrick said his fuel bills have risen from $400 to $700, and container costs have increased 30%. "If prices go up, we're eating that difference," he said. In Iowa, soybean prices declined from $13–$15 to around $10 per bushel as exports to China fell due to trade tensions.

The crisis is taking a toll on mental health in rural areas. Minnesota's farm and rural issues mental health helpline logged 314 calls in fiscal year 2025, the most in five years, and has already topped 279 in the first nine months of the current fiscal year.

For consumers, the impact is visible at the grocery store. The U.S. cattle herd is at its lowest level in decades, largely due to global drought, per USDA data. Ground beef averaged about $6.90 per pound in April, roughly 19% higher than a year earlier, according to Bureau of Labor Statistics data. Lower-income households are "doubly exposed" due to higher food costs and reduced SNAP support following cuts under the One Big Beautiful Bill, Zhang said.

Agriculture Secretary Brooke Rollins on April 28 outlined a plan including $900 million in grant funding for independent fertilizer companies, permit streamlining, and support for legislation to lower fertilizer costs. Trump announced an $11 billion "bridge payment" to farmers of row crops as they dealt with tariffs and falling crop prices. About $9.7 billion has been disbursed to 510,520 applicants, with 42% going to corn growers and 24% to soybean farmers, according to the USDA.

But Rob Haworth, senior investment strategy director at U.S. Bank Asset Management, said "additional federal or congressional support related to higher oil prices has been limited" for the agricultural sector.

Zippy Duvall, president of the American Farm Bureau Federation, told Trump in a recent letter: "When farmers face supply shortages or price increases, those impacts ripple through the entire food chain."