We asked Michael “Bo” Stone how inflation affects his farm.
Inflation hits farmers like a late April frost – unexpected and expensive. Spreading fertilizer feels like slinging gold dust, and let’s not even talk about seed costs. For equipment and supplies, you can expect inflation to add 5% to 10% every year. You know it is bad when you begin to consider WD-40 a luxury item! Inflation affects labor costs, too. Wages must increase to keep good workers, but higher payroll eats into already thin margins. Like everyone else, we are paying more at the grocery store, for a haircut or for other ordinary expenses. The problem is that there is no cost-of-living adjustment on the farm. We are dependent on the outside markets, which set the prices for the grains we grow and sell. Even if inflation affects input costs, prices don’t rise with inflation. In fact, they are off by about 35% since this time three years ago. It’s difficult to laugh when your costs grow faster than your corn, but what else can you do?
