Direct Farm Fuel Expenses, Results from a Large Farm Survey

1
Direct Farm Fuel Expenses, Results from a Large
Farm Survey

• Robert W. Dubman
• Survey and Data Coordinator
• USDA/Economic Research Service

2
Which farms are most vulnerable from rising
prices of fuels?

• Direct immediate impact
• Excludes effects on fertilizer expenses or other
  inputs
• Excludes product price changes
• Assumes farmers may be purchasing in bulk or from
  cooperatives

3
USDAs Agricultural Resource Management Survey
(ARMS)

• Roughly 10,000 samples annually
• Phase III
• Collects farm financial data
• Produces Income statements, balance sheets, and
  measures of financial performance
• Personally enumerated

4
Questions on whole farm fuel expenses asked
annually
Details asked in most years Gasoline Diesel
Natural gas LP gas Other fuels Electricity
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Since 1991, about 5 cents of every dollar of cash
expenses went to purchased fuels (gas, diesel,
natural gas, LP gas, lubes, and other fuels)
Source 1991 to 2002 ARMS/FCRS
6
Diesel fuel appears to have gained favor. In
2000-2002 average diesel expenses were twice
average gasoline expenses
Source 1991 to 2002 ARMS/FCRS
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Survey can categorize farms many ways
Region/State Size of operation Major commodity
produced Farm operator typology
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• In 2002, average diesel expenses were highest in
  Northern Plains.
• Average gasoline expenses were highest in the
  mountain region

Source 2002 ARMS
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• Gasoline as part of total cash expenses was
  highest for farms in the Delta region
• Diesel as part of total cash expenses was highest
  for farms in the Southern Plains

Source 2002 ARMS
10
Larger farms, based on sales, spent more on
diesel fuel than gasoline in 2002
Source 2002 ARMS
11

• Diesel and gasoline expenses as a percentage of
  total cash expenses are lower for the larger
  farms

Source 2002 ARMS
12
Rice, Cotton, Peanut, Vegetable, and Dairy farms
had the highest average diesel and gasoline
expenses
Source 2002 ARMS
13

• Rice, wheat, peanuts, and soybeans specialized
  farms have the highest proportion of diesel
  expenses to total cash expenses
• On average, specialized crop farms show higher
  diesel and gasoline expenses compared to total
  cash expenses

Source 2002 ARMS
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• USDAs Agricultural Resource Management Survey
  has a wealth of data on farm fuel expenses. Much
  more than can summarized in a presentation.
  Multiple years, more breakdowns of fuel types,
  different categories, and links to the financial
  performance of the farm operations are available.
• Expenses can be translated into physical units
  and into BTUs.
• Please contact me at ERS if this data could help
  your research.