What is the impact of the war in Ukraine on farmers in Ohio?
CHILLICOTHE — The ongoing war in Ukraine is limiting the country’s exports, which means the cost of wheat and corn has risen. This could be seen as a good thing for local farmers since they can charge more for their produce.
So how much more can farmers earn from this market shortage? The answer is not as much as you think.
Due to the shortage of grain in the market, farmers may charge more for their crops, but it also costs them much more to produce those crops. Part of the increase in production costs is due to gas prices. In parts of Ross County, diesel prices have reached over $5 a gallon, making it difficult for farmers who use diesel to power tractors and other equipment used on farms. The sanctions imposed by the United States on Russia also increase the average cost of fertilizers.
Chris Bruynis, agriculture and natural resources educator for the Ohio State University Extension Office, notes that every farm is different. For example, older farmers may not need to earn as much because their equipment is already paid for, as they have fewer bills and will generate more profit per crop.
“Overall, the industry is doing well,” Bruynis said. “There are individuals who will do well, and some who will have a less than stellar year.”
He also notes that the cost of fertilizer and the possibility of it not reaching farmers is the biggest problem. Farmers use fertilizers to help grow bigger bushels of crops, if farmers are unable to grow big bushels, the demand for these products will only increase. Some crops also need fertilizer so as not to deprive the soil of nutrients. Farmers add fertilizers and chemicals to help keep the soil healthy and safe to use.
Local farmer Brad Ault works with his father to farm around 25,000 acres of land and they also raise cattle to freeze beef. The cost of farming for him has nearly doubled in the past year, with the cost of fertilizer nearly tripling.
“Everything we invested has grown tremendously,” Ault said.
Ault uses his corn crops to help feed the livestock he owns, so the rising cost of corn and fertilizer is then going to impact the cost of the frozen beef he sells. Ault believes prices for farmers will continue to rise, forcing farmers to pay more to continue farming.
“It’s an expensive business,” Ault said. “We have to be very careful in our decisions about how we spend money.”
Brice Acton is a fifth generation farmer who has just taken over his family farm. He harvests corn, soybeans and wheat. Acton also mentioned how expensive it can be to farm. From the price of machinery and parts to the cost of crop insurance, farmers have to pay high tariffs before they even start farming.
Crop insurance helps protect farmers and lenders in the event of poor crop performance. Many farmers are required to have it in order to be able to borrow money. This is an expense that has increased dramatically in recent years, but one that farmers need to maintain.
“There are so many variables that play into this,” Acton said of the profit margin for farmers. Farmers have to look at crop prices and try to figure out when is the best time to sell, try to cut costs, find ways to be sustainable while still being able to make a living. For every farmer, the cost of running a farm is different, so there is no one-size-fits-all plan.
Some of the fertilizers used by Acton are completely depleted. Any fertilizer he can get he has to buy at more than double the price he paid last year. This is because a lot of nitrogen fertilizer is petroleum-based because it costs more for farmers to pay more.
When Acton first sold crops this season, he called his father excited because he had never seen prices like this before. Now, with the added expense and inability to get materials, he doesn’t think this year’s profits will be any different than other years.
“It seems unbelievable right now, but overall profit margins will be the same as last year,” Acton said.
Ultimately, while the war in Ukraine and the sanctions imposed on Russia increase the price of crops here in the United States, local farmers do not see their incomes increase due to the ever-increasing cost of farming. Ault summed up the impact of the war on farmers perfectly when he said that “farmers manage more money now, but they don’t make more money”.
Shelby Reeves is a reporter for the Chillicothe Gazette. You can email him at [email protected]