Senate Ag Committee economist says energy prices to blame for rising input costs
The chief economist for Senate Ag Committee Ranking Member John Boozman says the rising cost of farming has the committee’s attention.
During the Minnesota AgriGrowth Ag and Food Summit in Minneapolis Thursday, John Newton said energy prices are a huge concern for farmers and ranchers.
“What’s one of the reasons behind that? We’re producing a million barrels (of oil) less per-day this year than we did before the pandemic. What are some of the reasons for that? No more permitting for oil and natural gas exploration. That was one of the first things President Biden did.”
He says oil, propane, and natural gas supplies are near five-year lows, while fertilizer prices are at 13-year highs.
“Natural gas is a key input for nitrogen-based fertilizers, and what did I just say about energy prices? They’re up, so natural gas prices are up. So energy prices are up, so fertilizer prices are up. That’s why farmers are concerned going into 2022, inflation.”
Newton says farmers are paying 51 percent more for propane compared to last year, 80 percent more for diesel fuel, and 130 percent more for liquid nitrogen.