The Chelsea Standard
A Heritage Newspaper
Weekly Publication
Prices, expenses soaring on the farm
By Edward Freundl, Staff Writer
PUBLISHED: May 29, 2008
Farmers are being caught in the same downward spiral of the economy that every individual and every business is facing these days, and there doesn't seem to be an easy answer in sight.
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It's easy to complain about paying $4 a gallon for milk or $3 a loaf for bread, especially when you hear that farmers are getting record prices of $11 a bushel for wheat and soybeans or $6 a bushel for corn.
But you have to keep in mind that the farmers at the production end of the process have little control over the prices paid at the consumption end.
Indeed, the farmers are themselves consumers at some level.
"The prices we get (for milk and grain) keep going up, but so do our expenses," said Jerry Huehl, a partner in Huehl Acres on Fletcher Road in Freedom Township.
Taking a break from planting corn last week, Huehl looked at his diesel-powered tractors and diesel-powered pickup trucks and commented on soaring fuel prices.
"It'll hurt when we get a refill (for the farm's fuel tank)," he said.
"We bought 2,500 gallons a couple of months ago, and it cost us more than $9,000."
And the price of diesel has gone up about a dollar per gallon since then, an increase of almost 25 percent.
Even though the Huehls grow hundreds of acres of alfalfa and acres of corn for silage to feed their dairy herd, they still have to supplement that with commercial feeds.
"The last feed bill for the cows was $4,000, and that's enough to last about three weeks," Jerry said. "A year ago that would have been $1,800. It'll probably be $50,000 or more for this year.
"Those are the expenses people don't see."
Jerry's brother and partner in Huehl Acres, Denny Huehl, criticized the current state of the industry for straying too far out of balance.
"It seems like supply and demand has lost its foothold in the marketplace, with speculators deciding how much we're going to pay for everything," Denny said.
"Investors all feel they need a 10 percent return on their investment right away, and companies are struggling to do that - I don't know where it's all supposed to catch up."
He then shared his "big-picture" view of the economy, and suggested global trade may be part of the problem.
"They're all concerned about market share and keeping stockholders happy; I'm sure it's happening to all companies," he said.
"Part of the reason is our dollar is so low is that foreign investors have lost faith in it and devalued it. I'm not sure how much the general public is aware of how the world market works."
Huehl predicted dark days coming if the economic situation does not return to some sort of rational order.
"There's some real uncertain times we're looking ahead to," he said.
A time to sow
Despite the economic uncertainties of the global marketplace, there is still work to be done on the farm - namely, planting soybeans and corn.
Prices may be a constant concern, but a more immediate worry is with the dry weather we're encountering.
Wind and lack of rain have made conditions less than perfect for planting, and it's nearly impossible to see the tractor for the clouds of dry dust kicked up as it travels the rows and deposits the seeds.
"We're about where we're supposed to be, it's just the cycle going around," Deny Huehl said.
"We tried to spray (fertilizer and pesticide), but it all just blows away. We have to wait until the wind dies down, and we can easily waste a half a day."
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