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Archive for Saturday, April 22, 2006

Farmers contend with record-high fuel costs

April 22, 2006

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Todd Howard hooks up machinery with a fertilizer tank. Soaring fuel costs have made it more expensive for farmers to do business.

Todd Howard hooks up machinery with a fertilizer tank. Soaring fuel costs have made it more expensive for farmers to do business.

Put fuel prices next to the weather on the list of things that farmers worry over but can do little about.

"You just have to bite the bullet and hope for better times," says Mike Wintermantel, a corn and soybean farmer in Douglas County.

High costs of fuel, fertilizer and irrigation in other areas of Kansas are set to wallop farmers across the state this year.

"Because fuel is a variable input, when it goes up, it naturally takes away from the bottom line," says Jason Flory, another Douglas County farmer.

Last fall, when fuel prices skyrocketed after Hurricane Katrina, things looked pretty grim for farmers.

The picture has improved somewhat in recent months as fuel costs dropped from historic highs and crop prices inched upward, according to Kevin Dhuyvetter, professor of agricultural economics at Kansas State University.

However, Dhuyvetter says, "In northeast Kansas, corn and soybean markets are above their five-year average but not near enough to offset higher fuel and fertilizer costs."

Additional fuel costs will add to higher farmer costs, about $15 to $18 per acre, he says.

"It's just like you or I," says Bill Wood, Douglas County extension agent. "If we have to pay more for gas to drive to work it costs us more. And if we don't get a raise, it costs even more."

Source: Kevin Dhuyvetter, Samuel Funk, Terry Kastens and Michael Langemeier

Source: Kevin Dhuyvetter, Samuel Funk, Terry Kastens and Michael Langemeier

In Douglas County, farmers plant approximately 40,000 acres of soybeans, 25,000 acres of corn and between 7,000 and 9,000 acres of wheat.

The prices of diesel and natural gas hit record 10-year highs in 2005, and while having decreased, some remain historically high, according to a report by Dhuyvetter and Terry Kastens, also a Kansas State professor. Nitrogen fertilizer prices at a record 10-year high in February 2006.

Farmers like Flory and Wintermantel have taken actions to lessen their costs, such as switching to no-till farming. This reduces fuel use and cost by as much as one-fourth per acre, according to studies, and reduces soil erosion.

"If you have been thinking of no-till but have been reluctant to make the change - now might be the time to make the switch," Dhuyvetter says.

Dan Nagengast, a sustainable agriculture proponent in Douglas County, says reducing the impact of fuel costs would require major changes in the farming system over the long term.

He was among a group that included leading state agricultural officials to look at fuel costs. "We all kind of moaned about it. I think you need a big head to think of these things, and I don't see anyone smart enough to figure it out yet," he says.

Dhuyvetter says if the additional fuel costs hit consumers in the grocery, it wouldn't be for the farmers' benefit.

"If we start seeing higher prices, it's not because of fuel and energy for the farmer. It's more of fuel prices are higher from the farm gate forward, including the truckers and farm processors," he says.

Comments

Reality_Check 7 years, 12 months ago

$50 says the farmers will get a new subsidy from the National Debt to help them pay the higher fuel costs. Pork...I smell pork! What about it Ryun? Brownback? Put some pork in the pan.

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just_another_bozo_on_this_bus 7 years, 12 months ago

As Wes Jackson pointed out in his talk last evening, the industrial agricultural system that is so reliant on massive quantities of fossil fuels is the equivalent of burning the furniture to heat the house. And we're just about to run out of furniture.

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