Drought prompts federal agency to offer emergency loans to New Mexico farmers

The United States Agriculture Department on Tuesday declared a drought disaster in all 33 New Mexico counties, making farmers and ranchers who suffered livestock or other losses eligible for low-interest emergency loans. 

The USDA’s two disaster declarations cite the United States Drought Monitor, which on Thursday shows all of New Mexico in some stage of drought, with most of the state experiencing “extreme” or “severe” drought.

Because of the USDA’s declaration, farmers and ranchers are eligible for loans up to $500,000 covering a range of costs at lower-than-market interest rates. For example, producers can receive a federal Farm Service Agency loan for operating costs at 4.75% interest, according to a USDA fact sheet. 

The loans can pay for production costs associated with a disaster, essential living expenses, farm reorganization costs or the refinancing of certain debts, according to the USDA. 

The federal deadline to apply for the loans is Dec. 24, 2026. USDA officials directed farmers and ranchers interested in the loans to their local Farm Service Agency officers for more information. 

Extremely low snowpack this winter exacerbated ongoing drought in New Mexico and across the West. Recently, Gov. Michelle Lujan Grisham declared a drought and wildfire emergency, which directed a state task force to help local governments as much as possible. 

The governor’s declaration also coincided with the publicization of a new website — the Drought Information Portal — that contains an array of state and federal resources regarding the ongoing drought, weather conditions and fire risk.

A recent industry report found that New Mexico’s food and agriculture industries generated more than $50 billion in economic activity in 2025, including employing 146,000 people statewide who work in farm or food industries and earn $5.9 billion in wages.