By Scout Nelson
Nebraska agricultural producers are facing higher diesel costs this planting season as fuel prices continue to rise. Corn and soybean growers in the state spend about $110 million more on diesel fuel compared with the same period last year.
Grant Winterer, host of All Things Considered at Nebraska Public Media, reported that the increase places Nebraska among the states with the largest rise in diesel spending. Nebraska ranks fourth nationally, behind Illinois, Iowa and Minnesota, based on research from AAA, the U.S. Department of Agriculture and Iowa State University Extension.
Higher fuel costs are creating additional pressure for farmers because grain prices are not increasing at the same rate. In previous years, rising diesel prices were often balanced by stronger grain prices. This year, that balance is not happening, making higher fuel costs more difficult for producers to manage.
Iowa State University Extension specialist Ann Johanns said diesel prices normally increase over time. However, farmers usually have better grain prices to help offset those higher expenses. The current market does not provide the same level of support.
Diesel prices have increased by nearly 50% since last fall. The rise is linked in part to uncertainty surrounding the Iran war and possible effects on shipping through the Strait of Hormuz. Changes in global energy markets can quickly affect fuel prices paid by farmers.
Recent crop market reports provide some hope for producers. Crop supply and demand conditions are becoming somewhat more positive, which could provide some support to farm markets. However, higher production costs remain a major concern.
Machinery is one of the largest areas of farm production spending, and diesel represents an important part of those costs. For Nebraska agricultural producers, diesel can account for about 25% of machinery-related production costs.
Although diesel may not be the largest expense across an entire farm operation, the higher cost has a noticeable effect on farm budgets.
Farmers continue to manage tight margins while dealing with higher fuel and other production costs. Even if crop markets improve, producers are likely to remain focused on controlling expenses and protecting farm income.
The current situation shows how changes in energy markets can directly affect agriculture. For Nebraska farmers, diesel prices remain an important cost to watch as they move through the 2026 growing season and prepare for 2027.
Photo Credit: istock-i-stockr
Categories: Nebraska, Crops, Corn, Soybeans, Energy