This story was originally published by Carolina Public Press.
With spring in full swing, many North Carolina farmers are preparing their fields for the corn planting season. But the diesel fuel and liquid nitrogen fertilizer required for the task have spiked in price and put pressure on those farmers for a reason halfway across the globe: war in the Middle East.
Those elevated input costs, paired with a severe drought that’s currently impacting vast swaths of the state, couldn’t have come at a worse time for corn producers who are coming off back-to-back years of disappointing yields.
“This is one of the toughest times I’ve seen in agriculture,” said Ron Heiniger, an extension specialist with N.C. State University and one of the nation’s leading experts on corn production.
“We’re right on the planting season for corn or even early soybeans,” he continued.
“(Farmers) have got to get these planters in the field, and they’re stuck having to pay a higher price for fuel than they want to. Even if the war ended today, by the time the fuel price came down, they would already have had to put this crop in the field, so it’s caught us at the worst time, farm-wise, you could imagine as far as using fuel.”
Corn has been an attractive field crop for farmers the past several years because its price has remained high relative to cotton and soybeans, Heiniger explained. But corn is also sensitive to weather conditions and requires lots of liquid nitrogen fertilizer, which is not easy to come by right now.
Iran’s closure of the Strait of Hormuz, a key global trade route, during its war with the U.S. and Israel has choked off fertilizer shipments that American farmers rely on. On top of that, spiking energy costs have raised fertilizer prices along with it.
Alex Jordan, a Columbus County farmer and president of the North Carolina Corn Growers Association, told Carolina Public Press that he’s seen the price for liquid nitrogen more than double compared to last year. Aside from the price hike, it’s also become more difficult to source.
He had bought a load of it earlier in the year before the supply chain was disrupted, but it won’t be long before he runs out of his current supply, he said.
“If I can’t tie down another load of fertilizer, I just couldn’t plant (corn) because there’s no option,” Jordan said.
“My fertility program depends on that product. Never had problems getting it in 30 years.”
That’s affecting Jordan’s decision making when it comes to how much corn he intends to plant. He’ll probably cut down on some of that crop and replace it with soybeans, he said, and he likely won’t be alone in that decision.
Jeffrey Dorfman, a professor of agricultural and resource economics at N.C. State, told CPP that higher oil and fertilizer prices may encourage farmers to shift some acres away from corn. Soybeans, which require less fertilizer and are more forgiving when it comes to drought, are a logical replacement.
“In general, these higher prices mean a 3-5 percent increase in production costs for most crops, which is very unwelcome after production costs have already risen about 65 percent in the last five years,” Dorfman said.
“So it’s also possible farmers will reduce total acres planted or try alternative crops outside the main row crops.”
Ironically, some economists suggest that crops used in biofuel production – which includes corn and soybeans – could see their price increase alongside energy costs, potentially alleviating some of the pain from higher production costs. But that scenario is contingent on prices remaining high through the harvest, which is half a year away, Dorfman said.
Farmers may also try to make a go at it with reduced fertilizer or alternative sources of soil nutrients, according to Dalton Suits, an extension agent in Chatham County.
“Like with any curveball, farmers try to do the best they can, but honestly most will try to reduce fertilizer inputs by utilizing poultry litter or reducing total amount of fertilizer used, even at the cost of reduced yields,” he said.
North Carolina is also suffering through troubling drought conditions after an unusually dry winter. At least 15 counties are now experiencing extreme drought, and most others are facing severe or moderate drought, the North Carolina Drought Management Advisory Council said last week.
If those conditions continue, it could mean poor growth for farmers at the start of the growing season, or delays in planting, DMAC Chairman Klaus Albertin said in a press release.
But at least for now, the drought hasn’t significantly affected farmers yet, according to Heiniger.
“We don’t usually enter the season with groundwater levels as low as they are right now, so that’s certainly a problem,” he said.
“But most of our crop is actually made on rainfall that occurs through the season.”
Although reliant on favorable weather, it’s still possible for the corn crop yields to bounce back this year, Heiniger said. An end to the war in the Middle East and a resulting stabilization in oil and fertilizer prices could also bring welcome relief to farmers.
“You know, if a farmer thought he wasn’t going to make more this year than he did last year, he’d probably quit a long time ago,” Jordan said.
“So the eternal optimist in me says, yeah, it’s going to be a good year.”
