Taming Farm Fuel Costs Using Farm Level Planning

By Jonathan LaPorte

The recent conflict with Iran and restricted passage through the Strait of Hormuz have led to increases in diesel fuel costs. National prices of diesel fuel have steadily increased by almost 40% since the beginning of the conflict, with Michigan prices showing similar trends. Purchases of farm (off-road) diesel fuel have not been immune to these increases. With higher fuel costs, many farms are trying to determine how best to adjust their cost of production estimates. Michigan State University Extension recommends that budgeting start with farm-level planning.

Farm-level planning focuses on the typical field operations for each intended crop. Identifying the fuel usage for an intended crop offers several important considerations.

• Are the tractors being used older or in good repair?
• Are field operations the farm has typically used necessary this year?
• Are there opportunities to reduce or combine field operations?

The answer to these types of questions could help to significantly reduce fuel usage and overall cost. Especially as farms consider the types of soil in the fields they operate and their impact on fuel usage. The first step is to identify fuel usage by field operation, then adjust usage based on soil type.

Tractor condition and fuel usage

Fuel consumption often varies between tractors. Older tractors or those in poor mechanical repair may use 10% or more additional fuel. There are also differences in fuel efficiency between different-sized tractor engines and the fuel needed to move the tractor. However, tractor size is not often a significant consideration, according to Purdue University.

While smaller tractors use fewer gallons per hour than larger tractors, they have to run longer hours to cover the same acres. Often, the gallons per acre between small and larger tractors are similar enough to ignore when estimating fuel usage. Instead, the cost of fuel (gasoline or diesel) is correlated to the field operation, or production activities that each farm uses to grow a crop.