Corn+Soybean Digest

Energy's Only Part Of Rising Costs

Rising grain production costs are attributable to more than what goes into your tractor's gas tank, says Gary Schnitkey, University of Illinois Extension farm management specialist.

Of the $50 increase in per-acre costs between 2003 and 2005, less than half are directly attributable to rising energy prices, he says, based on a recent study.

For northern Illinois grain farms, per-acre financial costs have increased from $349/acre in 2003 to $399/acre in 2005, an increase of $50/acre.

“Of the $50 increase, energy-related items account for $22/acre, or 44%, of the cost increase. Fertilizer is the leading cost increase category, with a $16/acre increase between 2003 and 2005. Fuel and oil costs increased by $6/acre during that time,” says Schnitkey.

Schnitkey co-authored the study with colleague Dale Lattz called “Cost Increases: It's Not Just Energy.” You can access the full report at www.farmdoc.uiuc.edu/manage/newsletters/fefo06_11/fefo06_11.html.

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