Adopt cost-saving strategies
As I write this, crude oil prices are trading more than $100 a barrel.
Everyone has noticed that gasoline and diesel fuel prices have increased substantially in recent weeks. Some experts suggest that speculators investing in the futures market are to blame; others point toward civil unrest in foreign oil-producing countries.
Really, it does not matter what is causing the price escalation but, rather, now is the time to maximize the “do more with less” theory.
Agriculture producers will not be able to add a fuel surcharge on products leaving the farm but certainly will be paying fuel surcharges on materials, supplies and parts purchased.
I wrote a news release almost exactly to the day six years ago, reporting that crude oil was over $50 a barrel and gasoline prices at the pumps were at $2 a gallon.
It’s interesting that in six years time the end user is paying twice as much for gasoline and diesel.
Is there any shortage of crude oil? Are there new refineries being built or are existing refineries running at full capacity?
Is every effort being made to ease the pain at the pump on our entire society?
Until the answers to these questions are “Yes,” there will be little chance of any change.
Agricultural producers depend so much on energy to operate their farms it is essential. Consider that electric, natural gas, diesel, gasoline, oil, etc., are used every day and used to produce many related products such as fertilizer.
There really is not much producers can do other than to consider changing production practices. Examples include using no-till methods to plant; reconsider driving 60 miles to purchase parts and purchase over the phone, having the parts delivered.
It is easy to say do more with less, but now is the time. Trying to make management and production practice changes now will help to position producers when crude oil prices increase even more.
Report changesIf you have bought, sold or are renting different land, make sure you report the changes to the Farm Service Agency office as soon as possible. Failure to maintain accurate records with FSA on all land you have an interest in can lead to possible program ineligibility.It is producers’ responsibility to notify FSA of any changes in their farming operation or entity status throughout the year.Items that might affect a determination include a change in contract shares; modification of a variable/fixed bushel rent arrangement; a change in the size of the producer’s farming operation; a change in the structure of the farming operation, including any change in a member’s shares; a change in the contributions of farm inputs of capital, equipment, active personal labor, or management; and a change of farming interest not previously disclosed on CCC-902 or update, including the farming interests of a spouse or minor child.Luke Fritz is executive director of the Butler County Farm Service Agency.
