Farms spend More On Indirect Energy Inputs Like Fertilizer Than Direct Energy Inputs Like Fuel

The agricultural sector uses energy both directly (in the form of fuel and electricity) and indirectly (through use of energy-intensive inputs, such as fertilizers and pesticides). Data from the Agricultural Resource Management Survey show that on average, the share of operator expenses for indirect energy (about 17.1 percent) exceeds the share of expenses for direct energy (about 8.5 percent) among U.S. farm businesses, across all farm sizes.

Small farm businesses have the highest share of direct energy expenditures (about 12 percent of all small farm production expenses), while medium-sized farm businesses have the highest share of indirect energy expenditures (about 22 percent of expenses).

Large farm businesses have the lowest share of energy-based expenses, since large farms typically have higher expenses for labor than smaller farms, reducing energy’s share of total expenses.

Source:usda.gov