Herb Kohl: “It might be of interest to the chairman, and other Senators, to share some information I have received from the USDA…”

“It might be of interest to the chairman, and other Senators, to share some information I have received from the USDA Office of the Chief Economist on the question of how energy costs affect various types of farming operations. I asked the Chief Economist if he could provide the amounts that farmers pay for direct fuels costs, electricity, and indirect energy costs such as those associated with the production of fertilizer and chemicals. According to that office, using the most recent year for which these amounts are available, 2004, producers of so-called program crops, including wheat, corn, feed grains, rice, cotton oilseeds, and peanuts, paid a total of $9.9 billion for these sort of energy inputs. Of that total, corn had the highest energy costs with $4.9 billion. Cotton producers came in second at $1.7 billion. On the other hand, peanut producers paid $145 million for these same costs. The average energy cost for these seven different commodities, by commodity, was $707 million. However, I would like to point out to my colleagues that the energy costs of dairy producers, as described by the USDA Office of the Chief Economist, was $2.2 billion. While dairy production was not the highest single commodity for energy costs, it did come in second and was three times greater than the average. While these costs were high in 2004, we all know what has happened, and is continuing to happen, to energy costs since then.…”