Congress didn’t pass a budget by the October 1 deadline, and that’s sent the federal government into shutdown. For agriculture, this is more than just a paperwork delay, it puts critical services on pause, from loan processing to conservation payments, right when many farmers need them most.
With key USDA programs paused and FDA activity scaled back, the shutdown is already changing how ag producers, processors, and exporters operate. From halted loan processing to food safety gaps, here’s what the shutdown actually means for agriculture on the ground.
Services Paused or Delayed
Without new funding, many USDA operations have stopped. More than 42,000 employees, about half of the agency’s workforce, are now furloughed. This directly affects the processing of:
- Conservation program payments
- Cost-share assistance
- New loan applications
- Research projects tied to soil, pests, and crop development
Agencies like the Natural Resources Conservation Service (NRCS) and Farm Service Agency (FSA) have scaled back to only essential duties, mainly tied to disaster response or preserving government assets. That means routine support services and general customer communications are offline.
If you’re waiting on a conservation payment, trying to finalize a new equipment loan, or depending on updated agronomic data this fall, expect delays.
Inspections, Safety, and Trade
While some government functions are still running, they’re doing so with smaller crews, and that’s already affecting day-to-day operations across the food and ag sector.
Meat, poultry, and egg inspections are continuing, which is good news for processors. But the teams handling these inspections are operating with fewer staff than usual. Bottlenecks are likely to be caused by hiccups such as illnesses or local emergencies, particularly at busy plants.
Exporters should also brace for delays. At ports, inspections and permit reviews are happening, but with skeleton crews. Delays in inspection timing inevitably affect producers shipping perishable goods like livestock or specialty crops.
As for the FDA, they’re focused on urgent public health issues like recalls or foodborne illness. However, most other work has been put on hold, including food policy work, routine laboratory testing, and reviews of new products or ingredients.
Federal Research and Regulatory Activities
With most USDA and FDA research programs paused, several long-term projects are now in limbo. That includes studies focused on pest resistance, crop disease, soil health, livestock genetics, and food safety innovation. These aren’t just academic; they’re the backbone of many extension recommendations, input trials, and animal health tools producers rely on.
For many farmers, the more immediate issue is the freeze on permit approvals. Whether it’s a water access permit, infrastructure upgrade, or an input-related authorization, the approval process has been halted unless it’s tied to an emergency. That means some on-farm improvements may be stuck in neutral, or need temporary workarounds, until federal offices get back to full capacity.
Where Farmers Might Feel It First
While emergency programs like SNAP and wildfire response continue for now, the everyday services that support farm businesses like data reports, grant program support, technical assistance, and loan processing, are offline.
Some specific impacts to expect:
- Conservation payment delays for NRCS programs
- No new farm loan approvals during the shutdown window for USDA and FSA loans
- Interrupted crop and labor market data due to possible Economic Research Service (ERS) and National Agricultural Statistics Service (NASS) furloughs
- Slowdowns in H-2A wage rulemaking and foreign labor certifications
- Permit backlogs for USDA-reviewed bioproducts or research trials.
How Long Will It Last?
That depends entirely on Congress. The last major shutdown in 2018–2019 lasted 35 days. A shorter shutdown could cause only minimal disruption, but a prolonged lapse will likely create months of downstream delays in research, program payments, and regulatory activity.
Shutdowns don’t stop agriculture. But they do slow the government’s ability to support it.
Final Thoughts
Farmers aren’t new to working through uncertainty, but this shutdown affects some of the very tools that help manage risk. With so many USDA and FDA functions paused, producers will need to be patient, creative, and alert to new developments.
In the meantime, keep close tabs on your conservation contracts, upcoming loan obligations, and potential delays to inspection or export clearance. When federal services return, there may be a backlog. Preparing now will help you respond quickly later.
Conterra is dedicated to financing American agriculture, offering specialized agricultural loans tailored to meet the specific needs of farmers and ranchers nationwide. Our people, products, and process-driven approach to lending makes us unique.
Disclaimer: Please note that the information provided in this article is for educational and informational purposes only, and should not be construed as financial or investment advice. While we have made every effort to ensure the accuracy and reliability of the information presented, Conterra Ag Capital and its affiliates make no representation or warranty as to the completeness, correctness, timeliness, suitability, or validity of any information contained in this article. You should always consult a qualified financial advisor, tax professional, or other qualified professional for advice on your specific financial situation.
