The 2025 corn harvest is capturing attention as the most prolific in US history. One would expect this to be beneficial news. However, rather than experiencing increased incomes, farmers are confronting financial losses, while taxpayers are staring at billions in necessary federal emergency funds. The underlying issue is clear: we are cultivating more corn than the market can handle, year after year.
Considering the current demand, it is estimated that corn growers could have maintained profitability instead of incurring losses had they reduced planting by approximately 11 million acres. This reduction would have led to a significant decrease in synthetic nitrogen fertilizer use, consequently preventing a staggering amount of nitrous oxide (N2O) emissions—17,000 metric tons of this potent greenhouse gas, equivalent to the annual emissions from roughly 1.1 million cars. Additionally, it would have kept 170,000 metric tons of nitrate from polluting drinking water in various rural wells, rendering it unsafe for consumption.
Rising input costs and a sluggish export market—both skewed by tariffs—are often cited as the culprits behind the sluggish agricultural economy. However, the more significant issue is structural. During the spring planting season, when farmers sow their crops, they were already anticipating a significant surplus.
Beyond the headlines, two critical issues plaguing the agricultural sector often go unnoticed: Firstly, farmers seldom see profits from corn. In most years, their revenues fall short of covering production costs, with taxpayers stepping in to bridge that gap.
Secondly, the environmental impacts of most corn production are dire. Many are aware that prevalent agricultural practices negatively impact pollinators (such as bees), contaminate freshwater supplies, and render lakes, rivers, and coastal areas hazardous. Yet, corn production also releases an astonishing quantity of N2O, primarily from synthetic nitrogen fertilizers used in the fields.
These issues stem from consistent overproduction. Agricultural economists propose a straightforward solution: plant less corn on fewer acres.
The Importance of Every Farm
We’ve already lost too many farming families, and every exit represents a setback for rural communities and our entire food system. The current agricultural economy is driving many farmers to the edge, as mounting debts and plummeting prices herald a wave of impending bankruptcies.
Policy should focus on ensuring the survival of every farm family and growing their presence. This means creating effective agricultural economics, not through endless subsidies or externalized environmental costs but through a just and efficient market.
How Does Excess Corn Lead to Reduced Farmer Profits?
The answer lies in the basic economic principle of supply and demand. Livestock, ethanol production, and products like sweeteners and oils utilize a significant yet relatively stable amount of corn. When farmers plant more than this market demand, the resulting oversupply drives prices down. (While not being the main subject here, the ethanol and livestock sectors are also characterized by extensive market distortions and environmental implications.)
Using recently released USDA data, it is estimated that the surplus corn leads to a decline in farm revenues to approximately $159.50 per acre below the breakeven threshold. In other words, corn prices would need to increase by 22% to merely cover farmers’ expenses. (Details of my calculations are outlined below.)
This implies that production exceeded demand by about 2.0 billion bushels—representing the output of around 11 million acres. If those acres had been previously omitted from planting, prices would have seen an upward adjustment, and average revenue from corn production would have sufficed to cover costs.
Excess Agricultural Output and Environmental Pollution
Reducing corn planting wouldn’t only mean fair compensation for farmers and avoidance of taxpayer bailouts—it would also significantly reduce environmental damage.
When assessing the pollution arising from the use of synthetic nitrogen fertilizers, it is estimated that planting corn on those 11 million acres resulted in approximately 17,000 metric tons of N2O (4.7 MtCO2e), pushing us away from climate objectives and inflicting damages estimated at around $940 million. This figure is likely conservative; recent studies indicate that soil microbes in US row crop fields convert synthetic nitrogen fertilizers into N2O at a rate three times higher than standard estimates suggest.
Regarding water contamination, this surplus corn leached about 170,000 metric tons of nitrate into freshwater supplies, ultimately making drinking water hazardous and adversely affecting aquatic ecosystems.
It’s vital to recognize that this pollution comes solely from the surplus corn acreage and doesn’t account for the damage from the additional 80 million acres planted across the nation.
Why Don’t Farmers Simply Grow Less Corn?
The answer partially hinges on their inability to do so—thanks to a phenomenon agricultural economists call “the treadmill of production.” Unlike Apple, which meticulously forecasts demand to match the production of iPhones, farmers operate individually. The suppliers and grain buyers—feedlots, ethanol refineries, exporters—are few but powerful, whereas farmers are numerous and disconnected. This disparity prevents farmers from collectively reducing supply to stabilize pricing.
Another contributing factor is—surprise—subsidies. As previously mentioned, farmers already were aware that they were overplanting and would not reach breakeven this year. Yet, instead of having the ability to align supply with demand—or receiving assistance from the government as was customary before agribusiness interests reconfigured the system—current farm policies offer little alternative but for farmers to sow as many acres as possible. Programs like crop insurance, price loss coverage, and marketing loans ensure that taxpayers cover the losses, creating incentives that perpetuate ongoing corn overproduction while sidelining alternative markets.
This denotes the significance of cooperatives and coordinated supply management (though neither is a panacea). For instance, through cooperative ownership, Organic Valley has successfully supported countless family dairy farms by forecasting demand and coordinating supply, ensuring prices cover the actual production costs.
Effective agricultural policy also begets results, just as it did with the Agricultural Adjustment Act of 1933 (AAA). By compensating farmers to reduce acreage, the AAA alleviated oversupply, increased farm incomes, and provided essential relief amid the dire circumstances of the Great Depression. Ironically, the current farm bill—an evolution of the AAA—has reversed this logic. Instead of stabilizing markets, the subsidized crop insurance, direct payments, and other forms of support, along with ethanol mandates under the Renewable Fuel Standard, now fuel the very overproduction that the original legislation aimed to curtail.
Of course, food dynamics differ from those in electronics, given its role in nourishing individuals. Nonetheless, the irony lies in the reality that a significant portion of US corn doesn’t directly feed people. Approximately one-third is converted into ethanol, while much of the remainder is allocated to livestock feed and processing into sweeteners and oils. If Apple operated its production of iPhones similarly to our corn growth practices, it would inundate stores with unwarranted devices, selling them at a loss while taxpayers absorbed the deficit.
This encapsulates the basic supply dilemma. The more severe truth, however, is that once the United States became trapped in persistent corn surpluses, markets and policies evolved to absorb this surplus. Ethanol arose as a government-facilitated outlet while livestock operations consolidated and intensified to take advantage of the cheap feed. Marketing campaigns like “Beef. It’s What’s for Dinner” and “Got Milk?” serve to generate demand for mountains of excess meat and dairy produced on artificially inexpensive grain.
A More Intelligent Route Ahead
The remedy is as straightforward as it is challenging: cease overproduction. By planting fewer corn acres, farmers could achieve fair compensation without relying on taxpayer bailouts, while pollution levels would substantially decline. Genuine transformative change will require time but initiates with addressing the issue and rallying around farmer-driven solutions that restore both the land and the livelihoods of those who cultivate it.
Indeed, feeding an expanding global population remains a legitimate concern; however, we are far from addressing that issue at the present. The real crisis currently is overproduction, which compromises societal health and the environment while pushing skilled farmers out of the industry.
This is not an extreme idea. It mirrors the operational logic of every robust sector of our economy. No automobile manufacturer churns out limitless vehicles simply because it’s feasible. They gauge demand, regulate supply, and adjust pricing accordingly. Agriculture deserves to enjoy the same level of rationality and fairness.
Ultimately, every individual farm holds significance. If we truly want to see an increase in the number of farm families—rather than a decrease—we must push for policies that help transform that vision into reality.
Calculating the Details
Below, I outline the calculations used to estimate the oversupply’s ramifications for farmer income and environmental effects.
Step 1: Understanding Farmers’ Financial Standing. According to the USDA’s 2024 Costs and Returns data, the average cost of cultivating corn is $887.63 per acre when considering total economic costs (not merely out-of-pocket expenses). In 2024, the average gross revenue was merely $757.48 per acre, which indicates a loss of around $130 per acre. To forecast the net profit for 2025, we will rely on 2024’s cost estimates until the USDA publishes the latest figures in January. Anticipating cost increases (particularly in fertilizers) this year, this will offer a conservative perspective. For 2025, the USDA’s September WASDE report predicts a yield of 186.7 bushels/acre at a price of $3.90/bushel, translating to approximately $728 per acre. This results in a projected shortfall of around $160 per acre in 2025.
Step 2: Price required for farmers to break even. The lost $160 per acre needs to be accounted for in revenue for farmers to reach a breakeven position. When distributed over 186.7 bushels per acre, this indicates that prices would require a rise of $0.85 per bushel, roughly 22% (increasing from $3.90 to $4.75 per bushel).
Step 3: Assessing the required contraction of supply. Prices increase when supply diminishes, but the extent of this decrease depends on demand elasticity. For corn, an average elasticity of -0.548 reflects applicable estimates (such as this and this). (This indicates that a 10% price increase results in approximately a 5.5% decrease in demand.) Using this elasticity value, to achieve a 22% price surge, supply would need to decline by around 12%. For a national corn yield of 16.8B bushels, this translates to about 2.0 billion bushels in surplus supply, representing the yield from approximately 11 million acres.
Step 4: N2O emissions stemming from the excess corn. Corn producers apply an average of 151.8 lb of synthetic nitrogen fertilizer per acre across the ~95% of corn fields that receive fertilizer. Multiplying this by 11 million acres reveals that about 1.6 billion lbs of nitrogen (N) was applied to fields that were unnecessary to plant.
- Field emissions: Existing data shows that in the U.S., around 1.3% of synthetic nitrogen applied is emitted directly as nitrous oxide (N2O-N), which equates to approximately 20 million lbs of N2O-N. This percentage varies, with higher rates in wetter conditions (1.6% on ~74% of corn acres) and lower rates in drier areas (0.5% on ~26% of acres), but is often considered underestimated.
- Water emissions: The IPCC estimates that 24% of applied nitrogen leaches into water (~370 million lbs N). Going further, the IPCC indicates that 1.1% of this is emitted as N2O-N, leading to an additional ~4.1 million lbs of emissions.
- Total N2O-N output (from both field and water sources): Combining the two emissions gives us approximately 24 million lbs.
- Total N2O: When converted, this translates to ~38 million lbs of N2O, equivalent to ~17,000 metric tons of nitrous oxide. This equates to about 4.7 MtCO2e when assessed through the IPCC’s global warming potential factor (273).
- Considering the EPA’s value for the social cost of N2O being set at $54,000 per tonne, the cumulative climate damages tally up to roughly $940 million.
Step 5: Addressing Nitrate Contamination. The noted 370 million lbs of nitrogen lost to waterways as nitrate (NO3-N) (~170,000 metric tons) represents a staggering quantity of nitrate entering rivers, lakes, and drinking water systems.
