Corn grows in a field in southeastern South Dakota in August 2023. (Makenzie Huber/South Dakota Searchlight)
Farmers across South Dakota are seeing healthy crops, but abundant supply and weakening foreign demand are driving prices down, some of the state’s economic advisers said during a Thursday virtual meeting.
Karl Adam, South Dakota Bankers Association president and a Governor’s Council of Economic Advisors member, said many farmers have a great crop but are looking at losses of “$125 to $200 per acre” for their corn, due to prices falling from above $7 per bushel several years ago to less than $4 per bushel currently.
“On the ag side, I think we’re going to see a lot of balance sheets contract,” he said.
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Evert Van der Sluis, a council member and South Dakota State University economics professor, said the declining profitability of crops is likely why the S&P Global growth forecast for South Dakota’s 2025 gross domestic product — the sum of all goods and services produced within its borders — is 0.4%. National growth is projected to be 1.7%.
Van der Sluis warned that labor shortages in agriculture and construction could worsen the situation as federal immigration policies tighten and deportations increase. Several participants pointed to other federal policies as compounding the uncertainty, including tariffs pursued by the Trump administration.
A tariff is a tax paid by an entity importing foreign goods, with the cost often passed along in prices charged to domestic consumers, Van der Sluis said. He said the Trump administration’s approach to tariffs and international relations has hurt the U.S. on the global stage.
Roughly half of U.S. soybeans typically go to China, but buyers there have shifted some purchases to Brazil, which has rapidly converted land to agriculture and improved ports and rail infrastructure, according to council member John Hemmingstad of Elk Point, a director of Avalon Capital Group.
“China’s still eating and buying. They’re just not buying from us,” Hemmingstad said.
From June 2024 to June 2025, U.S. agricultural exports to China declined by 39%, according to an Investigate Midwest report citing data from the Census Bureau’s USA Trade Online database.
Despite the downturn in crop prices, farmland values remain strong, buoyed by investor confidence that federal lawmakers will step in with financial support, Hemmingstad said. But with a lot of industries suffering the effects of tariffs, he added, “there’s no guarantee we’ll get that same safety net.”
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