Here & Now

Darin Von Ruden on Fuel and Fertilizer Price Shocks to Farms

Frederica Freyberg:
Fuel and fertilizer: The cost of them has spiked due to the war in Iran that has disrupted crude oil fields and transport, as well as the export of fertilizer. On farms in Wisconsin, growers consider their crops and spring planting in the face of this price volatility. Wisconsin Farmers Union President Darin Von Ruden is here with more. He joins us from Westby, and thanks a lot for being here.

Darin Von Ruden:
Thanks for having me this morning.

Frederica Freyberg:
Fuel and fertilizer – the cost of them has spiked due to the war in Iran that has disrupted crude oil fields and transport, as well as the export of fertilizer. On farms in Wisconsin, growers consider their crops and spring planting in the face of this price volatility. Wisconsin Farmers Union President Darin Von Ruden is here with more. He joins us from Westby. And thanks a lot for being here.

Darin Von Ruden:
Thanks for having me this morning.

Frederica Freyberg:
So what are your farmer members saying about the price shocks happening right now?

Darin Von Ruden:
Well, lots of concerns. You know, some of our members actually were able to book their inputs last fall, so probably aren’t going to see that sticker shock this spring like we are amongst other members that don’t have the ability to because of cash flow problems by that. So they’re right now probably examining, do we stay with corn and need to put more nitrogen on the ground, or should we look at a, you know, small grain crop or do we plant more soybeans just because of that price of fertilizers has increased so much in the last two weeks here.

Frederica Freyberg:
What are the ways the increased cost of fuel impact producers?

Darin Von Ruden:
Well, in — really in all aspects, number one, it costs more to get the items that we need to produce the crops to the farm. There are surcharges that our co-ops in process or our delivery folks will be charging. It’s going to cost more to put the crop in the ground, if — unless you were able to book that fuel earlier, which doesn’t happen very often. And then just to get the products that we produce to the consumer through the processors and distributors. We’re probably going to be seeing surcharges on those deliveries too.

Frederica Freyberg:
Now the Trump administration just waived a 100-year-old shipping law to speed up oil and fertilizer shipments ahead of spring planting. How welcome is that?

Darin Von Ruden:
Well, you know, if it helps in that price of what the cost is to get — buy that gallon of diesel or that gallon of gas, you know, it certainly is welcome news, but I’m hearing that it’s — it probably will have very little impact on it because, you know, planting season is probably two weeks away in southern Wisconsin here right now. So can that really impact what’s going to happen on day one when farmers need to be in the fields? Big question mark there.

Frederica Freyberg:
Yeah, for sure. So how difficult is it to move from corn to soybeans or other crops just, kind of, on a dime here?

Darin Von Ruden:
The biggest thing is, is the availability of the seeds. So, you know, farmers generally try to have that contracted earlier delivery. You know, at this time of year, those seeds are being delivered to the farm. So if your supplier has adequate supplies of both, you’re in good shape. But some years they’ll — the people that we buy from are trying to guess what farmers are going to do. And so could be shorted one or the other. And small grains is another issue because a lot of suppliers don’t necessarily have large quantities of that seed available. So it might take two to three weeks to get that to come in from another source.

Frederica Freyberg:
So even ahead of the war in Iran, how have Wisconsin farmers weathered tariffs and resulting markets?

Darin Von Ruden:
Yeah, certainly, you know, last year was not a good year for farmers on the, on the economic side. A lot of farmers posted losses in corn and soybeans, especially because of that disruption in the marketplace and not having those overseas buyers to buy that. You know, we have weathered a little bit of that with the increased prices that we’ve seen after President Trump announced some of the trade deals with China, but we still haven’t seen all of those markets come back to the level that they were two, three years ago.

Frederica Freyberg:
How meaningful have one-time payments out of Washington to offset tariff losses been for farmers in Wisconsin?

Darin Von Ruden:
Well, you know, it certainly has helped ease some of the pain between the banker and the farmer because they were able to pay maybe a bigger portion of the operating loan that they had. But in reality, when you look at the real numbers, it was only about 15% of what farmers needed to pay for their production costs. So, you know, in the end, we’re still quite a bit behind on that process. And, you know, farmers generally want to receive our income from the marketplace and not depend on Uncle Sam to send us a check when we’re in dire need. And so with the trade war that we had, you know, those market conditions were really impacted in a negative way. And it’s really a frustration of farmers that we need to depend on the federal monies to come in in order to pay bills.

Frederica Freyberg:
All right. Darin Von Ruden, thanks for explaining all this to us.

Darin Von Ruden:
Thank you, Frederica.