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Farmers' Fees Should Climb With Gas Prices E-mail
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Sunday, 06 November 2005
Farmers' Fees Should Climb With Gas Prices

11/2/2005

The Pantagraph (Bloomington, IL)

By Chris Anderson

If you've recently sent a bouquet of roses to someone you care for deeply, you may have paid a higher delivery charge given the cost of gasoline.

The same might hold true for that steaming pepperoni pizza delivered during Monday night football. With the price of diesel fuel mimicking gasoline, should farmers who perform custom work be thinking about following suit?

A study by University of Illinois Extension farm financial specialists points to just that fact. Whether you're a farmer hired for custom work or using the machinery strictly on your own fields, the diesel fuel hike means increased machinery costs.

The question is how much diesel prices have increased. Recently, diesel cost more than $3 per gallon. Gary Schnitkey and Dale Lattz, the U of I study authors, pointed to a variety of factors that might come into play when figuring added machinery costs -- equipment size, efficiency and type of operation.

For example, corn harvesting uses about 3.75 gallons of diesel per acre. That compares to just 2.67 gallons per acre for harvesting soybeans.

Similarly, plowing a field uses 2.36 gallons per acre compared to 1.33 gallons per acre to chisel plow, 1.64 gallons per acre for mulch tilling and 0.73 gallon per acre for disking.

If diesel costs $1.50 per gallon, the fuel cost per acre for corn harvesting totals $5.63. Increase the price of diesel to $3 per gallon, and that cost increases to $11.25 per acre.

Given those facts, Schnitkey and Lattz believe custom farmers should adjust their fees upward by using the actual fuel requirements and fuel prices.

Earthworm polluters?

Numerous soil scientists and farmers have sung the praises of earthworms. They can improve soil by loosening and aerating it with their burrows.

But a recent U.S. Department of Agriculture study out of Ohio puts a damper on the earthworm songs of merit.

Turns out their burrows may be funneling liquid manure and other contaminants into underground drainage pipes. The study was completed in no-till fields where liquid manure was applied.

Researchers Martin Schipitalo and Frank Gibbs found water moved through wormholes twice as fast when the holes were within 2 feet of drainage pipes.

The situation isn't without a solution. Farmers can install shutoff valves so they can turn off drainage pipes during liquid manure application and for a short time afterward. Some Ohio farmers have already incorporated shutoff valves through a cost-sharing project with the Ohio Department of Natural Resources.

Another solution would be to install catch basins at the edges of fields to capture water draining from pipes and hold it for reuse.

Worms are particularly attracted to no-till fields in areas that require drainage. That's because they like the combination of no-till, drainage pipes and liquid manure. Worms feed on leftover crop parts in no-till fields. They eat manure as well.

Drainage pipes aerate the soil making it nice and loose for worm digging. And the crop residue in the field provides a worm shelter. With no-till, in which crop residue remains untouched from harvest to planting, the worms have no fear of having their tunnels broken apart.

Comparing Your Farm to Others

Want to know how your farm stacks up against others like it? Go to www.farmdoc.uiuc.edu/finance/benchmarks.asp.

U of I Extension specialists have developed tools to make farm performance comparisons. The tools include a financial benchmark providing peer group financial ratios for farms by different characteristics.

Another tool provides a spreadsheet with key ratio calculations, historical trends and benchmarks for Illinois farms based on sales, age, farm type, tenure and all farms.

 
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