Fuel and electricity prices are going up again, but farm income isn’t being pulled up with them.
American Farm Bureau Economist Betty Resnick says that’s taking a toll on producers nearing planting season.
“It does take a lot of fuel to do what we need to do. You also have things like the cost of electricity. That also impacts farmers a lot for their grain dryers, or if you’re a high-energy cost production, like poultry production.”
Resnick says electricity costs are also rising.
“Across the entire Midwest, electricity prices are up 5-and-a-half percent, year-over-year. And, in the Upper Midwest, that was even higher in Minnesota and the Chicago area.”
Resnick says farm income is declining at the same time OPEC production cuts, wars overseas and U.S. refinery disruptions are causing higher gas and oil prices.
“We are projected to have lower incomes, both year-over-year from last year, and it was also a decrease from the year before, so two years of declines in income.”
The U.S. Department of Agriculture forecasts about a 25% drop in net farm income this year.
On a positive note, Resnick says natural gas prices are declining, keeping ammonia and fertilizer prices in check. She also says USDA REAP grants and loans are available to buy renewable or energy-saving systems.
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