Fuel costs expected to increase harvest prices

Rod Bentley checks wheat Friday in his field near Dighton. Rising fuel costs are expected to increase the price of harvesting wheat. But farmers should be able to to pay the higher prices because prices for the wheat also have increased. To read more about how farmers are being affected by the economy, see Sunday's Journal-World.

? Custom cutters and farmers alike are bracing for what will likely be the most expensive winter wheat harvest ever amid record high fuel prices.

“We don’t even know to hardly price the deal this time. Is there going to be hard feelings? I am sure there is. Our costs are so high and farmers are going to be against it. Everything went up,” said Steve Shepherd, president of U.S. Custom Harvesters, the Hutchinson-based industry trade group.

Shepherd, a custom cutter from Onida, S.D., has been harvesting crops in Arizona and California for three weeks. In that time, gas prices have risen 65 cents a gallon, he said.

And it is not just fuel that is going up – equipment and other costs are rising as well.

“It is going to be the most costly harvest,” said Kevin Dhuyvetter, a Kansas State University agricultural economist who produces the U.S. Custom Harvester’s annual Custom Harvester Analysis and Management Program report.

Farmers can expect to pay between $7 and $10 per acre more to cut their wheat this year than a year ago, said Robert Belt, a custom cutter from Kingman.

The cost of custom cutting is figured based on negotiated prices for cutting and hauling the crop per acre, and considers the yields in the calculations. And then there is the fuel surcharge. All told, it may cost farmers around $35 per acre to cut a typical 40-bushel-per-acre field, Belt said.

Belt said it costs him between $700 and $800 a day in fuel to run one of his big combines, meaning he spends between $3,500 and $4,000 a day just for gas for his five combines – not including the gas he puts into the grain trucks that haul the crops to elevators.

“Those numbers are realistic – they could be spending that much,” Dhuyvetter said.

But this season’s harvest costs will be eased somewhat by the soaring prices farmers are getting for those crops.

Farmers who have normal yields this year – and sell their crop at current prices of around $7.50 a bushel – are going to be making money despite the higher harvest costs, said Dhuyvetter.

With the winter wheat harvest at least three weeks away in Kansas, some farmers are also concerned about whether there will be enough custom harvesters to cut the wheat crop in timely fashion.

Cool, wet weather has delayed crop maturity in southern counties where the harvest typically begins, said Dusti Fritz, chief executive officer for Kansas Wheat.

“We are probably going to be harvesting in all four corners of the state at the same time,” Fritz said.

Winter wheat harvest is now under way in southern states like Texas and Oklahoma.

On Thursday, The Kansas Department of Commerce announced it had partnered with Kansas Wheat to connect wheat farmers with custom cutters looking for work. The Kansas Wheat harvest program includes a toll-free number (817-251-4328) and daily harvest reports. Kansas Wheat is the cooperative representing the Kansas Association of Wheat Growers and Kansas Wheat Commission.

In the past 10 years, membership for U.S. Wheat Harvesters has been halved as custom cutters left the business, Shepherd said. But bigger, more efficient machines have helped fill the gap.

Belt said if the Kansas wheat crop matures all at the same time as expected, there should be enough harvesters to cut the crop – but it may not be done in as timely a way as everybody wants.

“If it is a good crop,” Belt said. “It is going to take more time and more combines to cut.”