Friday, September 17, 2010
Farm Input Costs Going In the Wrong Direction This Year
News of improved farm income numbers also reflect a rise in inputs.
While recent farm income reports showed a definite rebound over the last year, according to USDA Chief Economist Joe Glauber one farm income related statistic that also increased should not be taken as a good sign: the price producers paid for inputs.
"Certainly as the world economy has come back we've seen oil price rise again and that's had some effect," Glauber said. "And of course on the input side if you are buying feeder cattle or other sorts of things your costs up on that side as well."
Glauber says several categories with in the 2010 input forecast reflect an opposite trend from last year, especially when it comes to oil.
"In terms of cost side I think something buried in those numbers, we see that fuel costs are up about 22% from 2009," Glauber said. "So we saw those big drops in fuel prices, that was at least the one good news in the 2009 numbers, but they are up again."