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Archive for Sunday, October 23, 2005

High priced and growing

Farmers’ input costs threaten output

October 23, 2005

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Rising natural gas rates do more than drive up home-heating costs.

Try adding hundreds of dollars to Larry Landis' fertilizer bill.

"The prices - everything's going nuts," said Landis, who farms 260 acres in rural Lawrence. "I don't know what we're going to do next year. It's all so high."

Recent spikes in energy costs are feeding growing concerns in the agricultural community, which is finishing an above-average fall harvest that is fetching below-average prices.

And while reports of solid yields, good crop conditions and relatively few storage concerns are a bright spot for farmers, the skyrocketing price tags on farm inputs are positioning them for pain.

Fertilizer prices already are up 50 percent from a year ago, and could go even higher as natural gas prices - a key component in the production of crop nutrients - continue to rise.

A ton of nitrogen fertilizer that cost $175 in 2002 and started this year at $305 today is going for $400 or more, said Bill Wood, ag extension agent for K-State Research & Extension in Douglas County.


Larry Landis, right, watches soybeans pour from his truck bin as his father, Warren, sits alongside. They delivered soybeans to the North Lawrence Elevator with other farmers Wednesday morning, and already have worries about costs to produce next year's crops.

Larry Landis, right, watches soybeans pour from his truck bin as his father, Warren, sits alongside. They delivered soybeans to the North Lawrence Elevator with other farmers Wednesday morning, and already have worries about costs to produce next year's crops.

"And the projections are that by spring it could be up over $500," Wood said.

Such costs are pushing many farmers into an especially difficult position, Wood said.

Typically, farmers rotate their crops, so that land that might have been used for soybeans this year might be set aside for corn in the spring.

But soybeans typically don't require application of extra fertilizer, Wood said, while corn certainly does. And at about $33 an acre for fertilizing corn, the costs can add up.

"If you have 400 acres, that a $13,000 difference," Wood said. "You can see the temptation to plant soybeans rather than corn."

Soybeans already are the county's top cash crop, accounting for about half of all row crops planted, Wood said. Expanding that acreage even more could save farmers input costs in the short term, but end up costing them in the long term.

Failing to rotate crops, or having a lack of fertilization, can trim 12 percent to 15 percent from a crop's yield, he said. With less grain headed into the bin, that means less money going into the farmer's bank account.

Rob Smith, Pomona, works the scales at the North Lawrence Elevator. As he took time Wednesday to watch the weather information on his computer, area farmers raced to get the crops in before rain hit that afternoon.

Rob Smith, Pomona, works the scales at the North Lawrence Elevator. As he took time Wednesday to watch the weather information on his computer, area farmers raced to get the crops in before rain hit that afternoon.

Then there's the cost of diesel. The fuel for tractors, trucks and other farm equipment was going for $3.59 a gallon Friday at the Ottawa Co-op, after going for a little more than $2 a gallon a year earlier.

With the Douglas County farm economy estimated to generate more than $30 million a year, Wood said, the effects of such expenses can reach deep into the Lawrence-area economy.

"We're all facing higher gas prices, and higher fuel prices to heat our homes, but they're getting a double whammy - the input costs to make their living are going up, too," Wood said. "I don't face that. I don't drive a combine that uses 200 gallons of diesel a day. I use a computer.

"If we took a survey of all the farmers in the county, there are some who would say, 'I'm not sure how I'm going to make it.' "

Landis, for his part, figures he'll take a chance and not plant much corn this spring. Going a season without rotating is a chance that might be worth taking.

"Last year we cut down on our corn acres and planted more beans, because it was cheaper to put beans out there than it was to do corn," said Landis, whose fall harvest consists of 60 acres of corn, 100 acres of soybeans and 100 acres of hay. "I'm not going to put 100 acres of corn out, I know that right now. It'd cost too much."

Matthew Vajnar, who runs the grain operations for Ottawa Co-op, said that he'd heard from other farmers who were thinking about placing a heavier emphasis on soybeans for 2006.

"Guys have choices now," he said. "The costs certainly will cause them to rethink whether they want to plant corn."

Comments

just_another_bozo_on_this_bus 8 years, 6 months ago

What's required is a return to a solar-based agriculture, rather than the current petroleum-based agriculture. That would be more labor-intensive, but as globalization continues to suck jobs from this country, it would lead to a revitalization of family farms and rural communities.

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jrlii 8 years, 6 months ago

What I want to know is, howcome diesel is nearly 50% more than gasoline nowadays? They have always been pretty close, a few cents one way or the other, but a dolar twenty?

The now traditional two crop rotation has been showing its weakness for years now as chemical fertilizer and pesticide prices have climbed and worsining tilth has required ever more powerful tractors to pull the equipment through the soil.

It may be time for farmers to think seriously about switching to a three or four year rotation scheme like the extension folk were promoting back before chemical fertilzers became much less expensive in the late 40s and on therough the 50s.

This would require growing a high nitrogen demand crop like corn only every third or fourth year, with nitrogen fixing legumes planted in between.

While I'm a little vague about the details, it might work out something like this:

Soy beans Alfalfa hay (maybe two years) corn etc

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just_another_bozo_on_this_bus 8 years, 6 months ago

Ethanol and biodiesel can supply some of our energy needs as we begin the painful process of weaning ourselves from fossil fuels, but only as byproducts of food production. As Sean points out, it takes more energy to produce them than you get back if the crops are raised soley for fuel, expecially if the crops are corn and soybeans.

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sean 8 years, 6 months ago

This is why I have such a hard time believing ethanol is going to solve our energy problems in this country, like so many idiots have promoted. First, one gallon of ethanol has roughly half the BTUs of one gallon of gasoline. So, it takes twice as much to provide the same amount of energy. And, I seriously doubt that the equipment used to harvest the corn is run off of ethanol. Wes Jackson, the director of the Land Institute out in Salina figured (in the 1980s) that it would require nearly half of the land in agricultural production just to provide the ethanol required to harvest the corn!

Rising natural gas prices (due to depletion- forget the talk of Peak Oil for a minute- we are past peak production of natural gas in the United States) will continue to raise the cost of fertilizers and ultimately that of our food.

This is a very serious issue, but my fellow citizens have been duped into believing "tarra" is our primary concern, and have practically no basic working knowledge of our energy problems.

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