Rising fuel costs adding an additional $6,000 per month to dairy farm expenses

A recent survey shows rising diesel costs are increasing production expenses by an average of $6,000 per month.

Sherry Bunting with the American Dairy Coalition tells Brownfield, “Some are being charged a fuel surcharge per mile on top of their hauling deduction. That would be about 13 cents from January to July and then that surcharge increased another 7 cents from July to October.”

She says it’s having an impact on farmer profitability.

“The mailbox price went from being 59 cents per hundred weight below the all-milk price to being 90 cents below the all-milk price,” she says. “Dairy farmers have ongoing, nonstop, non-crop costs.”

Bunting says the group would like to see producers benefit from the USDA’s Harvest Fuel Relief Program.

“They harvest corn silage and soybeans,” she says. “Those are title one crops, but those costs only represent 25 to 33 percent of their total fuel exposure.”

Bunting says the coalition is currently gathering additional producer responses to further understand how diesel cost increases have impacted their bottom line.