Companies, workers cope with high gas costs

0 Comments | USA TODAY, May, 2006 | by Sue Kirchhoff

WASHINGTON -- High energy prices are increasing farmers' production and living expenses, adding burdens at a time when agricultural income is already coming off recent record levels.

Farm fuel costs are expected to rise at least 10% this year, with prices 113% above 2002 levels.

Energy inflation might be affecting planting decisions. A March U.S. Agriculture Department survey found farmers intend to plant 5% less corn and 7% more soybeans this year than in 2005.

One possible factor is that soybeans, which can convert nitrogen from the atmosphere, cost much less than corn to plant and fertilize. Pricey natural gas accounts for the most of the cost of producing nitrogen fertilizer.

Fertilizer could cost 10% to 15% more than in 2005, and is up 70% from...