North Dakota farmers are confronting record-high diesel prices as fall harvest ramps up, with fuel topping $6 per gallon in many areas. This surge in costs, which for some farmers represents double what they paid last fall, is raising concerns about profitability as combines and semitrucks begin their heavy work.
AAA reported Wednesday that diesel prices reached a record national high of $6.31 per gallon, while gasoline averaged nearly $4.37 a gallon. Bryan Dean, a farmer from Velva in north-central North Dakota and a North Dakota Corn Growers Association board member, observed diesel prices as high as $6.53 per gallon on his drive to West Fargo this week.
Chris McDonald, a farmer from Leonard in southeast North Dakota and president of the North Dakota Soybean Growers Association, stated that diesel costs are about double what he paid last fall. McDonald, who anticipates starting soybean harvest next week and corn harvest in about a month, noted at the Big Iron farm show in West Fargo that such expenses "can erase your profit." Farmers ideally contract diesel prices before planting and harvest, but many waited this summer, expecting prices to drop after a spring spike tied to the U.S. war with Iran. McDonald explained that prices "never really did drop very much" and then "skyrocketed."
Dean mentioned he filled his farm's fuel tanks as soon as the war broke out, but those tanks are now empty after spring planting, fertilizing, applying herbicides and pesticides, and harvesting early crops like wheat. With about 70% of his land planted with soybeans and corn, and harvest approaching, Dean said he plans to buy diesel only as needed until at least the November election. He also noted that diesel used to be cheaper than gasoline but switched over "a few years back," leading him to switch to gas-powered pickups, citing ethanol's benefits.
Allison Thompson, a market analyst with The Money Farm in Ada, Minnesota, described the fuel market as "a headline-driven trade" during a panel discussion at the farm show. Recent headlines include the war with Iran heating up again, which has restricted oil shipping through the Strait of Hormuz and Persian Gulf. Dave Ripplinger, a bio energy economist and associate professor with North Dakota State University, told reporters that an attack on a Saudi Arabian pipeline "really jolted the energy markets this week." Ripplinger also highlighted that the Russia-Ukraine war is back in the news with attacks on energy facilities, and Russia announced Wednesday it would continue its ban on diesel exports. He warned that farmers are in "uncharted price territory" where "you don't know exactly how high they're going to go."
Some North Dakota soybeans are refined near Dickinson for renewable diesel. McDonald indicated he uses a diesel blend with 5% renewable content, but the price is essentially on par with traditional diesel. This differs from gasoline blended with corn-based ethanol, which often sells at a discount at the pump.
The critical role of diesel for farming equipment, providing power at low speeds and for pulling heavy loads in tractors, combines, and semitrucks, means these high prices are a significant operational challenge for producers across Burleigh and Morton counties as they strive to bring in their crops.
