NASHVILLE, TN – U.S. farmers are expected to spend $5.3 billion more on fertilizer, lime and soil conditioners in 2026 as higher energy costs spread through agricultural production and transportation.
Dow Jones Energy says USDA projects those expenses will rise 15.3 percent from last year. Nitrogen fertilizer depends heavily on natural gas for both energy and chemical feedstock, while phosphate fertilizer relies partly on sulfur produced through oil refining and gas processing.
The report says fertilizer has historically represented about 17 to 24 percent of total corn production costs, making sustained energy disruptions a significant risk to margins, planting decisions and future input use.
Freight compounds the pressure because agriculture depends on trucks, railroads, barges and ocean shipping to move grain, livestock, feed and food products. Higher diesel costs can weaken export competitiveness and raise delivered costs throughout the supply chain.
Dow Jones warns prolonged energy costs could eventually move more visibly into wholesale and retail food prices as farmers, processors, transporters and retailers lose room to absorb additional expenses.
Farm-Level Takeaway: Higher energy prices are increasing fertilizer and freight costs that producers have limited ability to avoid.