Higher input costs could lower farm income potential next year. Fertilizer costs are getting a lot of attention. “Almost all fertilizer products are up double what they were compared to one year ago.” MinnStar Bank Farm Management Analyst Kent Thiesse says almost every input expense for crop production is expected to increase in 2022. This includes diesel fuel, propane, labor, custom work, repairs and chemicals. There could also be a boost in land rental rates. “Especially in those areas with better than expected crop yields and strong commodity prices. We’re seeing at least a ten percent or more increases in land rental rates.” A combination of higher crop input costs and a boost in land rents will put more pressure on crop breakeven prices for next year. Higher commodity prices can help offset higher input costs, but Thiesse recognizes the market volatility. As farmers sit down to pencil out their cost of production, Thiesse says they should consider the number bushels of corn, soybeans or wheat necesary to cover expenses at various crop price levels. “If you haven’t totally decided what crops you’ll plant, sit down and analyze with your management team.”
News Categories
Latest RRFN Podcasts
Subscribe to RRFN
Get a weekly digest from RRFN to stay up-to-date on all the latest news in agriculture.