Production Expenses Move Higher
Figures from the USDA National Agricultural Statistics Services show farm and ranch expenses in 2022 were higher compared to 2021. Total production expenditures in Nebraska were $28.5 billion in 2022, up 16 percent. Total expenditures per farm averaged $644,018, up nearly $100,000. Livestock expenses (purchases of animals) were estimated at $6.70 billion last year, an increase of 3 percent. Expenditures for feed were $4.50 billion, up 52 percent. Crop producers saw expenses rise 14 percent for chemicals and 22 percent for fertilizers. Spending on fuel increased 22 percent. Spending on rent and miscellaneous capital expenditures were the only categories to show declines in spending in 2022 compared to 2021. The figures come from responses by Nebraska producers to the Agricultural Resource Management Survey.
FIGURE 4. BREAKDOWN OF NEBRASKA FARM PRODUCTION EXPENDITURES, 2021 & 2022
Source: USDA National Agricultural Statistics Service
Figure 5 plots total farm expenditures in Nebraska since 2003. After stabilizing between $20-$25 billion in the previous decade, expenses rose sharply in 2021. Since 2020, expenses have surged 41 percent. Supply chain problems, Russia’s invasion of Ukraine, higher labor costs, drought, and inflation have all contributed to higher costs for farmers and ranchers. Expenses will grow again this year when the final numbers are tallied, but lower fuel, feed, and fertilizer costs should dampen the increases. The risk for producers moving forward is prices received fall more quickly than expenditures.
FIGURE 5. NEBRASKA TOTAL FARM PRODUCTION EXPENDITURES, 2003-2022
Source: USDA National Agricultural Statistics Service
