Montana Farmers Describe $12 Billion Federal Ag Bailout as a ‘Far Cry’ From Actual Losses

In the 1970s when the global demand for grains triggered a commodity price spike, American wheat exports increased dramatically and prices rose to roughly $4 per bushel in the early part of the decade.

Wheat prices fluctuated with that demand throughout the following decades in response to the market. But in the last two years, bushel prices have dropped to the same price that wheat was more than 50 years ago as the global supply ramps up and the demand plummets.

“Your commodity prices are the same price as they were in the 1970s – selling wheat for $4 per bushel,” said Tryg Koch, part owner of Heritage Custom Farming in the Flathead Valley. “But a new combine in the 1970s would be $8,000. Now, a new one is three-quarters of a million dollars to a million with the same prices of commodities. That’s the unfortunate part.”

Bushel prices must be $5.50 to break even, Koch said, and while low commodity prices that are hovering between $4 and $5 per bushel are hurting American farmers, additional costs driven by inflation and tariffs are only adding insult to injury.

While Montana’s exports aren’t as directly impacted by the Trump administration’s tariffs, things like the 50% levy on steel have driven equipment prices up dramatically while fertilizer prices are through the roof. Nitrogen-based fertilizer, for example, costs $660 per ton while phosphorus costs $875.

“The biggest front is our input costs due to unfortunate tariffs,” Koch said. “Our fertilizer was almost the highest it’s ever been in the history of farming. The steel tariffs raised your repair bills, your parts, anything that has metal in it. It jacked those prices up – it was very, very expensive.”

Earlier this month, the Trump administration announced the $12 billion bailout package that will include one-time Farmer Bridge Payments to American farmers. The relief is a “response to temporary trade market disruptions and increased production costs,” according to a U.S. Department of Agriculture (USDA) release.

Up to $11 billion will be used for the Farmer Bridge Assistance Program, which provides relief to row crop farmers, with payments distributed by early next year.

“The plan we are announcing today ensures American farmers can continue to plan for the next crop year,” USDA Secretary Brooke Rollins said in the release.

But Koch and agriculture economists say the plan hardly represents a bailout and will have little impact on Montana farmers as they brace for potential losses in 2026.

“Twelve billion dollars sounds like a lot of money when you have only 1.6% of the population who are feeding everybody,” Koch said. “It sounds like ‘Oh my goodness, $12 billion is bailing out the farmers – it’s going to make them whole.’”

Koch estimates the package will grant $30 per acre for row crop farmers who produce things like wheat, canola and pulses.

“The $30 per acre will help, but it’s a far cry from what the actual losses are,” Koch said. “We don’t need government bailouts – that doesn’t solve the problem and all it does is put a Band-Aid over it to keep up with inflation. We should be selling wheat for $8 or $9 per bushel.”

In Conrad, wheat farmer and Montana Farm Bureau Federation President Cyndi Johnson said the funds will barely cover fuel costs. While she doesn’t notice direct tariff impacts for exports, she too says input prices like high fertilizer and equipment costs have been her most significant overhead.  

While Johnson appreciates the efforts of the federal government, she describes the bailout as a “blip on the screen” as producers suffer losses and struggle to compete in the global market.  

With the expanded global supply of cheap wheat and other crops, Johnson said American farmers are pushed out of the market  as they compete with countries like Russia, Ukraine and Brazil who produce cheaper and lower quality products.

“We’ve lost a lot of that market share due to a lot of politics and the fact that it’s more expensive for someone in America to buy wheat,” Johnson said. “A box of cereal at the grocery store costs $6 or $7 – the amount the farmer gets is pennies.”

Eric Belasco, an agricultural economist at Montana State University, says as commodity prices hover around $5 per bushel, most farmers are either barely breaking even or experiencing losses.

“Margins are really thin,” Belasco said. “There’s a lot of global production and demand has stayed consistent. It’s a tight global market.”

The federal government has historically used the Market Facilitation Program to assist farmers during trade disruptions, which was authorized in 2019 to provide $14.5 billion in direct payments that included three rounds of payments at $15 per acre.

Those funds are funneled from the Commodity Credit Corporation (CCC), which is a Department of Agriculture program that uses money to implement specific programs established by Congress.

CCC funds typically account for $12 to $14 billion each year, according to Belasco, and are made available for disaster relief without the need for congressional approval.

“When you have a disaster, it’s helpful to have the executive branch get money out quickly and that’s the mechanism of that $12 billion – it’s about what’s in the account,” Belasco. “It’s what they can give out without needing the approvals. They used that $12 billion number rather than try and calculate the actual losses.”

For Koch, he said most producers can handle a few years of poor commodity prices, which is covered by crop insurance. But if losses stretch three or four years, some farmers won’t be able to continue operating at such thin margins.

“All commodity prices are suffering; all of them,” Koch said. “There isn’t really anything that pencils out for this upcoming year. Banks are really going to be looking at people’s budgets extremely closely, and most farmers – if not all – will be putting their budgets together for the year at a loss and asking, how do I lose the least?”

[email protected]