Feedstuffs in Focus
Feedstuffs in Focus is a weekly look at the hot issues in the livestock, poultry, grain and feed industries. Join us as we talk with industry influencers, experts and leaders about trends and more. Feedstuffs in Focus is produced by the team at Feedstuffs.
Feedstuffs in Focus
Agribusiness under pressure
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Margin pressure in agriculture is not a headline, it is a daily operating constraint. When diesel swings, fertilizer tightens, and geopolitics disrupts supply chains, agribusiness leaders have to make decisions fast, often without the ability to simply raise prices and move on. Host Sarah Muirhead sits down with Jim Clark of Granite Creek Capital Partners to map the biggest challenges to growth in agribusiness in 2026 and the real-world choices operators face when input costs surge.
They dig into what has driven inflation across the last several years, from the pandemic and shifting tariff policies to conflicts that ripple through energy markets. Jim explains why products tied to petrochemicals, including fertilizer and crop protectants, can become both expensive and hard to source, and how fuel and freight can turn into a second profit-and-loss statement all by themselves. We also talk about the “pass-through” problem: many agriculture businesses are price takers, so protecting margins often means tough trade-offs between pricing, volume, and asset utilization.
The conversation breaks down which sectors appear to be getting hit harder, why row crops have struggled more than livestock in recent years, and where biofuels exposure can help soften the blow. We also explore practical innovation, including efficiency gains that make NPK products or crop protection work harder at lower rates, and how precision agriculture tools like drones can make post-emergence application more feasible and targeted.
If you want a clearer view of agribusiness risk management, commodity market realities, and the technologies shaping farm profitability, this one is for you. Subscribe, share the episode with a colleague, and leave a review with your biggest takeaway.
Welcome And 2026 Growth Headwinds
SPEAKER_01Today's agriculture is not without its challenges. Whether it's high input costs, export market restrictions, or weather extremes, bottom lines and margins are under pressure. Welcome to Feedstuffs in Focus, our podcast taking a look at the big issues affecting the livestock, poultry, grain, and animal feed industries. I'm your host, Sarah Muirhead. This episode of Feedstuffs in Focus is sponsored by United Animal Health, a leader in animal health and nutrition. You can learn more about United Animal Health and how they're working to advance animal science worldwide by visiting their website at unitedanh.com. Joining us today to talk about the top challenges to growth in agribusiness in 2026 is Jim Clark of Granite Creek Capital Partners.
Pandemic Tariffs And War Driven Inflation
SPEAKER_01So, Jim, let's talk about the current challenges facing the agribusiness sector. What's the U.S. ag sector dealing with and what's driving those changes?
SPEAKER_00Sarah, that's a great question. We can talk uh 2026 or we can we can talk the last probably half decade. Um needless to say, U.S. agriculture has had a hard time catching a break uh this uh this decade. Uh my heart goes out to the industry. Um you know they've had to manage through a pandemic, uh rapidly changing tariff policies, geopolitics in in the Ukraine, and now in the Middle East, uh it's it's uh uh not been a walk in the park for the the agricultural sector. Um and and really the net of it is all of these have been contributing to you know inflationary pressure over the last five or six years. Um and for agriculture, as everyone who probably listens to this knows, if you're a participant in the market, your ability to pass on those price increases into the market to downstream partners isn't always entirely your choice. Uh, so a number of businesses are are faced with a market that gives them a price, uh, but uh without the ability to manage or mitigate these inflationary pressures. Uh so it's been it's been a really uh tough go of it these last five or six years.
SPEAKER_01And kind of some things that, you know, they didn't even realize were on the radar screen. All of a sudden your input costs are are going up because of conflicts, and it's it's hard to plan for so you can't plan for something like that.
SPEAKER_00Agreed. And and again, there there is the usual, you know, um, it's like in retail, you can always say my sales were good or bad because of the weather. And agriculture, you're always going to be managing weather events, whether it's this year, you know, drought in the southeast or being too wet in the upper Midwest that's delaying planting, um, you know, kind of a cadre of various uh disease states that, you know, kind of flow through the livestock sector, avian flu, African swine fever, the latest being the the new world screw room. Uh, but I think participants in the agricultural market are used to navigating those things because they're an annual
Petrochemicals Energy Shock And Availability
SPEAKER_00occurrence. As you said, there's things that are that are more episodic happening these days. Um, obviously, with uh the latest and the the conflict in the Middle East with Iran and the Strait of Hormuz impacting product availability, um, any any product or byproduct that is tied to or derived from petrochemicals, uh, fertilizer crop protectants have just seen, you know, you one, you can't either get the product or the price is is doubled or more. And then obviously just fuel or energy costs, you know, particularly in you know, everyday Americans see it at the gas pump or you know, truck drivers see it with the the cost of diesel, these fuel and energy costs are um are really are really tough to manage and swallow.
SPEAKER_01Pretty challenging to the the bottom line of agribusinesses as well, as I would imagine.
SPEAKER_00Yes, I mean the the short answer is is margins are getting hit. And as I said earlier, certain businesses are are um limited in their ability to pass on price increases. Some can and and some have. Um, you know, but most companies are faced with, hey, what can what can we tighten the belt on? What can we rationalize or cost cut? Um if there is a ability to do a price increase, you know, uh how much, what on what and when, is it just in a fuel surcharge? Is it on the everyday price? Is it permanent? Is it is it temporary? Um, and and again, obviously, you know, there is the the knock-on effect that you know if you do that to manage uh your your PL on the on the on the cost side, is that gonna uh hurt the downstream demand? If you have a higher price, are you gonna suffer in volume? And a lot of agriculture are high fixed cost businesses and and where asset utilization and volume really matter. So uh you may recover uh something on a unit price, but you may lose it because you you uh produce or sell less volume, which hurts you on your asset utilization. Um you know, there are just certain things that are hard to manage and outrun. Uh, I was checking in with one of our CEOs this week and made the comment that the fuel surcharge on a on a on a specific haul or trucking run was now as expensive as the underlying price of the haul. And again, there's only so much you can do with that um in the market other than try to um get through it until hopefully things normalize.
SPEAKER_01Are
Row Crops Versus Livestock Resilience
SPEAKER_01you seeing that any sector out there is is getting hit harder than another by these challenges?
SPEAKER_00Based off farm income data, uh the row crop side uh is being hit harder than the livestock side. And that's not a new new uh phenomenon. That's been the last uh you know several years. Uh if you're you know growing you know corn or beans or or wheat, your your um your PL is not uh has not looked as good as it did, you know, five, six years ago. Um, and and as a proxy for that, if I look across you know, Grandite Creek's, you know, you know, six, seven portfolio companies in the space, those that are are more closely tied to what is happening in the livestock sector have been able to manage these more choppy times uh better and had uh more consistent results than those that are selling products or services into uh row crops, just because their their customers are are trying to find efficiencies and figure out what they can and can't do. And that's not an easy person to try to convince to you know, sell more products or services to unless you have a very clear value. Um, so again, I as as as a small proxy, that's what we're seeing. Um, you know, one green shoot on the on the row crop side is uh, you know, obviously anyone that is um you know has exposure to the the the um biofuel market has benefited uh with the the large run up in fossil fuel prices. So that has helped um even if you know whether you're you're you're more traditional end markets where uh your your your crop output have been impacted or or muted, uh biofuels has been has been one thing that has been able to help uh uh lessen the blow.
SPEAKER_01Good point.
Efficiency Tech NPK Boosters Drones
SPEAKER_01So is there any are there any technologies that are helping agribusinesses um out there that that we should know about?
SPEAKER_00Well, uh what what what we've heard or and and seen in our own investment activities and in you know just following the markets as we do is it is really down to um what can improve or enhance what you're doing. Like on the row crop side, if there is something that improves the efficacy of an NPK product or a crop protection product, such that you may not have to, you know, you may only, you know, if you were applying it just as a standalone, you might only be able to apply 80% of what you previously applied and enhance it with with some, you know, kind of side by side with it that makes that 80% perform like it was 100%. You know, that's really where we're seeing um people in the market looking for efficiencies in an edge. Uh I had a was having a conversation uh with another another individual on, hey, post-emergence and you know, post you know, later stage growth. Um, you know, you know, how do you you know apply an herbicide or whatever, you know, when you no longer can drive a drive a tractor over it. And and you know, helicopter application and fixed wing application is cost prohibitive, and drone technology is making, you know, more uh precision farming and precision application uh later in the growing cycle post-emergence uh more feasible if there is a portion of land that is under more duress or or at risk. Um, you know, those are the things, you know, a couple examples of things that I've heard that that uh participants are looking at.
SPEAKER_01So,
Balance Sheets Lobbying And Hard Cuts
SPEAKER_01how best then for agribusiness owners to to overcome some of the challenges that we've been talking about here?
SPEAKER_00I mean, you know, it it is it is it's a hard question. Obviously, you know, some of it starts with their financial wherewithal, right? There's only so much that the market's going to be able to do and bear and in the in the environment we're in. Obviously, there is, hey, you know, make sure you have um an eye on uh your balance sheet, an eye on your kind of exposure to certain customers and their ability to to pay you and satisfy their obligations. Um just be a good fiduciary. Obviously, there is um you know things they can do for you know lobbying, you know, their their government officials at the state, local, and and federal level for you know additional support and subsidies, um, you know, you know, to help kind of bridge these more more difficult times. And then obviously there is going to be you know that those hard discussions on do we need to uh change what we plant? Do we need to reduce the number of animals we grow just to be responsible given where we're at in the market? Um and and what we've seen. Supply exits probably too slowly in these markets uh to you know uh uh to help normalize the the market trading price. I mean, ultimately things would be a lot better if you know every price for every commodity uh on the row crop or livestock side was up 10 or 20 percent. But those are global markets and they're not. So a lot of times to to basically you know help push push the market price up, supply has to leave, whether that's less planted acres or less animals. And those are those are things that typically take longer than anyone would would care to admit.
SPEAKER_01Nobody about nobody wants to be that one to to cut back first. Correct.
Long Term Bull Case Closing
SPEAKER_01So so what final thoughts, key takeaways do you want to leave our audience with here today?
SPEAKER_00Um, you know, I think you know, we we at Granite Creek still remain very bullish on the sector. We're looking at this in longer time horizons. Um, we still think the macro um themes are are there and consistent, you know, whether it's changing diet, protein consumption, you know, limited arable land, you know, again, I mean, there's always going to be these short-term, you know, one month, several month, several quarter annual cycles, but we just think over over the long term, you know, five, 10, 15, 20 years, uh, we we think this this the agricultural market is remains exciting and uh remains a place where there is opportunities for innovation and to um generate you know really nice businesses and you know growth and and top line and bottom line. And and again, we're we're we're here for the the the full ride. Um and again, you know, obviously we would hope some of the macro conditions would be a little more favorable, but uh it is what it is, and you just have to uh be eyes wide open and and manage, manage, actively manage through it.
SPEAKER_01Great points. And as we all know, agriculture feeds the world, so there's always a always a need for agriculture. Absolutely. Thank you so much for your time today, Jim. Thank you, Sarah. This episode of Feedstuffs in Focus is sponsored by United Animal Health, a leader in animal health and nutrition. You can learn more about United Animal Health and how they're working to advance animal science worldwide by visiting their website at unitedanh.com. I'm Sarah Muirhead, and you've been listening to Feedstuffs in Focus. If you would like to hear more conversations about some of the big issues affecting the livestock, poultry, grain, and animal feed industries, subscribe to this podcast on your favorite podcast channel. Until next time, have a great day and thank you for listening.