Rising fuel prices could mean higher costs for producers and consumers
- Writer: Adam Russell, 903-834-6191, firstname.lastname@example.org
- Contact: Dr. Mark Welch, 979-845-1751, email@example.com
COLLEGE STATION – Rising fuel prices could mean higher costs for producers and eventually consumers, said a Texas A&M AgriLife Extension Service economist.
Dr. Mark Welch, College Station, said he saw indications of fuel prices bottoming out late last year. And since January, there have been signs of overall inflation within the economy.
Higher fuel prices will mean an increase in input costs for farmers who are preparing land and planting 2017 crops, Welch said. It will also likely mean higher costs for irrigation, fertilizer and chemicals that aid optimum field production.
He said the concern is what higher fuel prices will mean not only to production budgets but the overall costs of producing, shipping and storing commodities.
“It goes beyond the diesel in the tractor and gas in the truck,” Welch said. “When fuel prices are high, it costs more to make things and move them. It affects food prices. Everything is tied closely to energy.”
Direct fuel costs today make up a small portion of production budgets, Welch said. Farm equipment is more efficient in fields, covering more acres or doing more in a single pass.
Diesel and gasoline fuel costs amount to around $6 to $8 per acre for a typical dryland grain sorghum or cotton crop, according to AgriLife Extension-based budgets, Welch said. The cost of fertilizer is around $12 to $20 per acre, twice the cost of fuel.
For irrigated crops, direct gasoline and diesel are little changed but fertilizer increases to $50-$60 per acre and irrigation fuel adds $40-$50 per acre.
A larger impact for producers is how fuel prices can impact other costs, such as fertilizer, Welch said. Fertilizer prices are low now, but about 75 percent of the cost associated with producing anhydrous ammonia, a commonly used fertilizer, is natural gas.
Typically, there is a lagged commodity price response at market to fuel prices and other increased costs on the input side, Welch said.
“It can make things difficult for producers when commodity prices are falling and costs continue to rise,” he said.
AgriLife Extension district reporters compiled the following summaries:
CENTRAL: Everything was showing signs of a very early spring. Some farmers put their sorghum or corn in the ground, and some were waiting on rains. Plum trees were blooming, and other fruit trees beginning to bloom. Green Bermuda grass was in fields. Pastures were in good condition. Livestock were seeking green grass in pastures and were in good condition. Pastures had a lot of winter grass with weeds due to a warm February. Wheat fields continued to look good. Rust was an issue with warmer weather conditions. Septoria, a fungus that causes leaf spot, was also spotted in several fields. All counties reported good soil moisture. Overall crop, rangeland and pasture conditions were mostly good.
ROLLING PLAINS: High winds and warm weather were taking their toll on moisture levels in the district. Topsoil moisture levels were short while subsoil moisture remained adequate. Farmers began preparing fields for this year’s crop, but progress was slow. Livestock were in good condition. Wheat looked good with producers scouting for insects. New forage is emerging in dormant pastures. Conditions have put residents on alert for wildfire dangers. Some ranchers heeded warning signs and began clearing fence lines in case of wildfires.
COASTAL BEND: Rainfall helped improve growing conditions, and more rain was forecast. Soil moisture conditions were excellent and allowed corn and grain planting. Some hay producers were applying phosphorus/potassium fertilizer. Pastures were greening up nicely, and cattle remained in excellent shape.
EAST: Spring appeared early in the district. Green-up grasses were underway. Some areas have seen winter forages develop well while other areas with warmer temperatures have reported warm-season forages were germinating and starting to break dormancy. Pasture and rangeland conditions were very poor in Trinity County and excellent in Rusk County. Most counties reported conditions as good. Moisture was needed to grow grass in some areas. Subsoil and topsoil were mostly adequate, with Shelby County reporting subsoil as short. Smith County reported a light rain with totals from 0.50-0.75 of an inch. Trinity County received up to several inches of rain over most of the county. Jasper County reported a slow rainfall which made conditions excellent for growing crops. Farmers were preparing to plant spring gardens. Disease and insect issues were still being reported on various plants in Smith County. Wood County reported trees budding out and flowering. Cattle were in good condition, but some supplemental feeding continued. Cattle were seeking green grass and grazing more. Spring calving continued along with bull turnout and rebreeding. Gregg County reported cattle prices were holding steady or a bit higher. The Houston County cattle market was stronger, with calf prices higher compared to previous weeks. Wild pigs continued to be a problem. Shelby County reported they were very active. Upshur County continued wild pig and gopher control.
SOUTH PLAINS: The district experienced high winds and blowing dust. The dry and windy conditions were drying out the topsoil moisture. Wheat was at or nearing the jointing stage but needed more moisture to keep improving. Field activities included shredding stalks, shaping beds, putting out fertilizers or compost and herbicide applications when conditions allowed. Pastures and rangeland were in fair condition.
PANHANDLE: The weather was windy, warm with no rain in the forecast. Conditions were extremely dry with high fire danger. Producers started some field work in preparation for planting season. The winter wheat was holding on with some pivots starting to irrigate. Some wheat growers were starting to spray for spider mites and were also finding aphids in wheat. Warm days were helping wheat and pastures progress. Cattle conditions were expected to decline until precipitation arrives. Cattle on wheat were okay, but wheat fields needed moisture. Cattle on grass were still being fed hay or cake.
NORTH: The topsoil and subsoil moisture levels ranged from mostly adequate to short with a few counties reporting surplus. Widespread drizzle to light rain was received. Temperatures varied from the high 80s during the day to the low 40s at night. Warm and windy conditions predominated most of the reporting period and dried out much of the moisture received recently. Trees started to bloom and leaf out. The pine trees started to produce pollen and shed. Wheat and ryegrass pastures looked good and were starting to produce some forage. Livestock were in good condition and handling the variations in temperatures well. Wild hog activity was high, and some were seen moving during the daytime.
FAR WEST: Temperature highs were in the 80s and lows were in the 40s. Precipitation was reported but averaged less than 0.03 of an inch. Windy conditions continued. Producers continued to prepare fields for spring planting. Wheat made great progress due to unseasonably hot weather. However, fields were also drying out on top fairly quickly. Farmers began to plow fields and were getting ready for the next cotton crop. Rangeland and pastures were starting to show effects of the lack of moisture. All perennial plants remained dormant. Spring calving continued. Lambing and kidding was in full swing. Producers continued to feed wildlife and livestock.
WEST CENTRAL: Unseasonably warm, spring-like daytime temperatures continued with cool to cold nights. A few areas reported some light rain showers. Soil moisture levels increased some with recent rainfall. Continued low humidity and high winds caused elevated fire dangers. Field work increased as the weather warmed up. Producers were preparing for spring planting. Row crop producers were plowing ground, spraying for weeds, and will start planting corn soon. Many ranchers started to spray broadleaf annual weeds along with prickly pear. Some producers were finishing up hay production. The cotton harvest was complete. Some ginning was left to be done but was expected to be complete soon. Wheat was in fair to excellent condition. Rangeland and pasture conditions were good to excellent with continued green-up. Cool-season forages continued to grow. Some warm-season grasses were beginning to break dormancy. Livestock remained in fair to good condition. A lot of cool-season annuals were available for grazing in pastures. Supplemental feeding continued but was decreasing. Cattle were fat. Demand was strong at auction, and the market was active. Fruit trees were beginning to bloom. Growers were worrying about a late freeze. Mesquite trees also began to bud break which was very early for the season.
SOUTHEAST: Livestock were in good condition. Row-crop producers were planting their driest ground and moving fast. Rain showers helped keep good moisture in the ground. Soil moisture levels throughout the district ranged from adequate to surplus with most ratings in the adequate range. More rain was expected and will likely slow planting. Soil moisture levels and temperatures were conducive to fast, uniform emergence and strong stands. Plants and trees are budding out. Walker County reported excellent growing conditions. Waller County reported more rain which restricted field work. Wet field conditions in Brazos County continued to delay the planting of corn. In Montgomery County, light rains helped with dry conditions.
SOUTHWEST: Rainy weather made for continued high topsoil and subsoil moisture. Pasture conditions started to improve, which was helping animal conditions. Body conditions were great for early spring time. Fields were very wet and muddy and not allowing farmers to work as planned. More rain was in the forecast. Lambing and kidding continued.
SOUTH: Weather conditions were up and down throughout the district. Temperatures were mostly in the 90s throughout the day and 70s in the evenings. Rainfall amounts ranged from 1.5 inches to more than 3 inches in some areas. Overall, rangeland and pastures were green, plush and full of good forage for livestock throughout most of the district. Crop production was fair, but fields still needed additional moisture for good development. Wheat, oats and potatoes were under irrigation. Field work increased in preparation for corn planting. Body condition scores on cattle remained fair. Soil moisture conditions ranged from adequate to short with most reporting adequate levels. Live cattle market pricing remained quiet with prices remaining where they were in the beginning of the year. Grasses and native plants were showing signs of germinating, though they have not grown much due to the lack of rainfall. Good progress was made on planting corn and some grain fields in Jim Wells County. In Zavala County, late-season spinach harvesting was active and was expected to extend another four to six weeks. Cabbage and onion fields also made good progress. Sorghum planting continued in Cameron County. The germination of corn and sorghum plants was good. Some irrigation occurred throughout. Some cotton planting was underway, and livestock conditions were fair. In Hidalgo County, row-crop planting continued and was very active. Harvesting of vegetables, sugarcane and citrus continued.