Congress has passed the One Big, Beautiful Bill Act, a legislative package signed into law by President Donald Trump on July 4. While much of the attention focused on tax and spending provisions, including an extension of the 2017 tax law and new requirements for Medicaid and nutrition assistance, the act also introduces notable changes to federal agriculture programs.
The act was approved without Democratic support in both chambers. All six members of Arkansas’ congressional delegation supported the measure. Senator John Boozman, R-Ark., led efforts to draft the agriculture and nutrition portions as chair of the Senate Agriculture, Nutrition and Forestry Committee.
“We could have tweaked the 2018 farm bill very easily several years ago,” said Boozman. “Because of inflation, that’s what changed everything. The financial part of the farm bill became very expensive, and it was just always a challenge to come up with the dollars that we needed.”
According to analysis by the Congressional Budget Office, these changes will increase federal spending for agricultural aid—including crop insurance and disaster assistance—by $65.7 billion over ten years.
Boozman noted that higher input costs and low commodity prices have put pressure on producers: “The reason we were able to do it this time was Congress realized how difficult it is in the ag economy right now. With very, very high input costs and very low commodity prices, it costs more to produce a crop than you can sell it for.”
One key provision raises reference prices for covered commodities such as soybeans and rice between 10.1% and 20.7%, with further incremental increases beginning in 2031. These reference prices form the basis for risk management programs used when revenues or crop prices fall below certain thresholds.
Farmers have faced increased challenges from stagnant reference prices combined with rising costs; net farm income dropped from $228.4 billion in 2022 to $163.1 billion in 2024 according to U.S. Department of Agriculture data (https://www.usda.gov/). “It’s sad, but the last two years have been some of the biggest drops in agriculture income in agriculture history,” Boozman said.
Will Maples from Mississippi State University said raising reference prices should provide a stronger safety net: “Producers have been at a point where the cost of production has far outpaced prices for their commodities,” he said. “Increased reference prices is one of the biggest things they’ve been asking for in this new bill.”
Arkansas Farm Bureau executive vice president Jarrod Yates described ongoing difficulties facing farmers despite good yields: “The job that farmers are doing on the farm cannot be much better, but the price they’re receiving for such a great product is so minimal that they’re not able to make a profit and cover their costs,” he said.
However, payments reflecting these program changes may not reach producers until fall 2026 at earliest unless Congress takes further action; lawmakers previously agreed to provide $31 billion in relief last December (https://www.congress.gov/).
“A lot of farmers are going to be making decisions again after harvest about buying seed and preparing for next crop year…all those financial decisions are going to be tough…without some assistance between now and end of year,” Yates added.
The act also updates crop insurance programs—boosting benefits for beginning farmers—and launches a pilot insurance initiative for poultry growers following discussions between Boozman and Sen. Chris Coons (D-Del.). “We’re just really recognizing all sectors of agriculture need a safety net,” Boozman stated.
Some issues remain unresolved; lawmakers may consider additional legislation addressing rural development or loan limits within USDA programs later this year.
Senator Amy Klobuchar (D-Minn.), ranking member on Senate Agriculture Committee, expressed hope Congress might still pass bipartisan measures: “I think there’s hope for that because there’s still other work that we have to do…I will acknowledge some things I supported were in that budget bill.”
Trade policy remains another area affecting agricultural markets as recent postponement of tariffs with China leaves future actions uncertain (https://www.fas.usda.gov/). The U.S., which ended fiscal year 2024 with an agricultural trade deficit of $31.8 billion after recording deficits each previous year (https://www.usda.gov/trade), faces questions about whether new relief payments may be needed if export conditions worsen.
“We’ve got to find new markets…so we can sell our products overseas,” Boozman said regarding trade challenges facing American producers.
