COLUMBUS, Ohio — Price increases, due to supply chain disruptions, are affecting agriculture producers and consumers alike, according to a quarterly report by rural creditor CoBank.

What You Need To Know

  • In this week's edition of Ag Report, anchor and reporter Chuck Ringwalt and agriculture expert Andy Vance discuss a quarterly report by rural creditor CoBank

  • The report states supply chain disruptions are causing price increases for businesses and consumers

  • Each week, Ringwalt and Vance discuss a topic of importance within agriculture

"It’s a really challenging time for a lot of industries,” agriculture expert Andy Vance said. “Everything from energy costs to input costs — we could be talking about steel. We could be talking about lumber. We could be talking about energy. [Energy] is a big one.”

The report is titled, "Adapting to Persistent Supply Disruptions."

"Rapidly rising input costs and product shortages are hitting agriculture particularly hard," the report said. "Robust agricultural exports have kept much of agriculture in the black, however, and credit conditions remain strong as harvest season enters full swing."

According to Vance, farmers utilize a host of industries that are being stressed, including steel and lumber.

"[Steel and lumber] are important in building farm buildings, grain storage, farm equipment and so on," he said.

Energy costs are also up, according to the report.

"Natural gas is a big one," Vance said. "If you look year over year, natural gas prices are up about 150% just since April, let alone where they were a year ago. When you've seen price increases like that, those of us who live in town, so to speak, might think about natural gas just in terms of heating and cooking, but it's a vital input in producing some important nitrogen fertilizers — some of the most important fertilizers that farmers use to grow crops, to then feed livestock, to make our meat, milk, and eggs and so on. When you're seeing those fertilizer prices shoot up like that, it makes it a lot more costly for farmers to produce food."

Vance said both producers and consumers will continue to feel the economic pinch.

"Producer prices, this is what farmers are paying to make the food that we're eating. Those prices are up about 20%. What farmers are paying to produce food is up about 20% year over year, while what we're paying as consumers is up maybe 3.5% to 4.5%."