Maine farmers feel sting of rising costs

The rising cost of gas has hit Maine’s farmers this spring with a triple whammy, from the higher price of diesel they use to run machinery to plant fields and clean barns, to the fuel used to create fertilizers and steel for machinery parts, to the increased costs they are paying for critical items such as grain trucked into Maine.

Looking ahead to harvest time, farmers around the state don’t think the situation looks any rosier.

They are fearful of what could happen to the fees that truckers charge to haul their harvested goods to market.

“We are being told that it could go up by as much as 30 cents per hundredweight,” said Don Flannery of the Maine Potato Board said.

Multiply that increase by the 17 million hundredweight of potatoes produced in Maine, and it could add $5.1 million in production costs this fall to an already stressed industry.

“We will have to move 65,000 acres’ worth of product out of here. Starting in December, we will be shipping seed to Florida,” Flannery said. “We struggled last year with truck shortages, and this will continue to be a serious issue.”

Meanwhile, many farmers are putting equipment purchases and even replacements on hold.

“The high steel prices are driving new equipment and parts through the roof,” Julie Marie Bickford, director of the Maine Dairy Industry Association, said. “I’m hearing that prices are up 20 to 30 percent.”

Brian Wright of the Wright Place in Clinton said he thought he was taking a chance last January when he ordered a used tractor, originally used to harvest sugar cane.

“Two weeks ago, the price went up about 10 percent,” he said. “Turned out to be a good decision.”

Equally as compelling as the concern about diesel fuel and replacement machinery parts is the high cost of grain, an increase not pushed by fuel costs but by a shortage of soy ingredients, Bickford said.

Still, a 5 percent gas surcharge has been placed recently on every bag of grain sold, said Arnold Marston of Blue Seal Feeds in Augusta.

“These poor farmers can’t catch a break,” Marston said. “Just when the milk prices finally go up for them, all their profit is eaten up by increased fuel and feed costs.”

Galen Larrabee of Thorndike said that when he first filled his 2,000-gallon diesel tanks at his farm this spring, the price was 97 cents per gallon. A gallon of diesel now averages $1.84 in Maine. And the cost of repair parts has him shaking his head.

“You can go and grab an armload of parts and spend $1,800 easily,” he said. “In the end, everything is going to catch up to us.”

Fuel, electricity and fertilizer account for about 15 percent of farmers’ manufacturing costs and as a result, energy prices are a critical cost of farm operations.

Directly affecting farmers has been the price of natural gas, which has been running two to three times higher than a year ago. Natural gas is the major component of making nitrogen fertilizers.

Flannery said many large-scale farmers already had locked in their fertilizer prices for this spring.

As farmers need to replenish petroleum-based fertilizers throughout the year, “the worst is yet to come,” he said.