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February 28, 2003   Email to Friend 

FARMERS FACE HIGHER FUEL AND FERTILIZER PRICES
Debra Davis
(334) 613-4686
February 28, 2003

Dale County farmer Chris Thompson fills up in preparation for planting. This year his fuel is costing him 67 percent more than a year ago.
MONTGOMERY, Ala. - Consumers aren't the only ones getting hit hard by soaring fuel prices which have climbed steadily for the past two months. According to some Alabama farmers, prices for off-road diesel have gone up nearly 70 percent since this time last year, and because nitrogen is a petroleum derivative, it's also jumped in price.

Gasoline prices have increased nationwide for nearly 10 straight weeks to an average of $1.66 per gallon, up 54-cents from this time last year. With farmers preparing their land for spring planting, the price jump couldn't have come at a worst time.

"This time last year, I was paying an average of 75-cents per gallon for (off-road) diesel, and now it's costing me $1.25 per gallon," said Dale County farmer Chris Thompson, who grows peanuts, cotton and corn on his 4,000-acre farm.

Alabama Farmers Federation President Jerry Newby has asked the Alabama commissioner of agriculture to investigate skyrocketing fuel prices to make certain the increases are legitimate.

"Unlike a lot of businesses, farmers can't pass along their increased costs of production," Newby said. "When you experience an increase of this magnitude for one of your major input items, it will seriously affect your ability to make a profit or even stay in business."

Commissioner of Agriculture Ron Sparks said his office is investigating the price increases to make sure they are justified. "It is an unfortunate situation for everyone," he said. "We have not found any cases in Alabama of a merchant taking advantage of farmers or consumers. Prices are generally the same across the state without one particular dealer or area charging more than others."

One of the coldest winters in recent years also has caused increased consumption and higher prices for greenhouses and poultry farmers. According to the U.S. Department of Energy, crude oil prices were $21.29 a barrel a year ago, now they are up to $35.05 a barrel. Likewise, natural gas that cost an average of $2.22 per thousand cubic feet a year ago now costs $6.30. Several factors contributed to the prices jumps, according to energy department experts. A colder than expected winter, the loss of Venezuela's production and worries about war with Iraq all complicate the situation.


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