Crop price rally offers hope, but $6 diesel leaves Midwestern farmers squeezed

A recent spike in corn and soybean prices is delivering Midwestern farmers a brief window of relief, but surging diesel costs threaten to erase those gains.

According to Business Insider, corn and soybean prices are the highest they’ve been since 2023. The spikes are partially due to strong global demand fueled by China. In July, China committed to purchase U.S. soybeans for the first time since May 2025. The country had been the largest buyer of U.S. soybeans since 2016, but it boycotted last year because of trade tensions caused by President Donald Trump’s tariff policies.

With China back in the soybean market, U.S. farmers are enjoying a slight bump in profits. However, the price of diesel is also at a $6.39 national average (as of Sept. 17), up from $3.70 a year ago. With diesel being the predominant fuel for farm equipment, Soy Transportation Coalition Director Mike Steenhoek told MPR News that it could eat into farmers’ profit margins.

“You can’t just really curtail the amount of fuel that you consume,” said Steenhoek. “You have to harvest your crop. You have to transport that crop. And machinery that has diesel engines is the way that that occurs.”

The financial squeeze goes beyond the pump. Steenhoek told SFN Today that farmers are also being hit by fuel surcharges from transportation companies.

“And one of the things that we witnessed, so a lot of transportation providers, railroads included, when fuel costs go up, they will institute a fuel surcharge,” Steenhoek said. “Looking at some data from the U.S. Department of Agriculture, what we’re seeing is from this point this year to the same point last year, you know, we’ve seen fuel surcharges increase from say $160 a rail car now upwards of $600 per rail car. So you’re seeing easily 100%, 200%, even north of 300% increases in fuel surcharges.”

Some farmers remain optimistic, including Minnesota Farm Bureau President Dan Glessing.

“Quite honestly, the rally will get us to that break-even mark,” Glessing told MPR. “Every farm is different on that break-even mark, but it will be for us. We’ll be at that break-even or a little better. So that has been encouraging, even with the higher fuel prices.”

According to the American Farm Bureau Federation, Chapter 12 farm bankruptcies increased by 46% in 2025 compared to the previous year.