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Overall farm production costs up 5% from previous, NASS report says

Agriculture.com Staff 08/04/2006 @ 12:34pm

Fuel prices led the rise in farm production costs for 2005, according to the latest U.S. Department of Agriculture-National Agricultural Statistics Service U.S. Farm Production Expenditures Report released yesterday.

Total farm production expenditures for the year totaled $223.1 billion, up 5.3% from the 2004 total. Fuel costs contributed to the total at the highest level, with an increase from the previous year of 26.3%. On the average U.S. farm, $106,499 was spent in production costs last year, compared to $100,498 in 2004. Other upward pressures on the cost to produce ranged widely.

"The rise in fuel expenditures was expected given the 2005 rise in crude oil prices and increased global demand for oil," according to the report. "Other upward influences on farm expenditures were biotech seed costs, increased broiler chick price, alfalfa winterkill in the upper Midwest requiring greater forage purchases, higher prices for dairy replacement females and repairs caused by storm damage in the South and Plains."

Conversely, four capital expenditures were down from the previous year. Feed, farm machinery, tractors and self-propelled machinery, and trucks and automobiles were all slightly lower in 2005, from a 5.1% slide in feed costs to a decline of 2.1% in trucks and autos.

Unchanged from 2004 were the three areas of greatest financial expenditure on U.S. farms, according to yesterday's NASS report. "Farm services" remained number one, accounting for 13.2% of all production costs while feed and labor rounded out the top three at 12.6% and 10.7% respectively.

Fuel prices led the rise in farm production costs for 2005, according to the latest U.S. Department of Agriculture-National Agricultural Statistics Service U.S. Farm Production Expenditures Report released yesterday.

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