Montana State University

Energy costs hit ag research centers, too

April 21, 2008 -- By Carol Flaherty


Dave Wichman harvests a small plot at the Central Agricultural Research Center near Moccasin. MSU photo by Stephen Hunts.    High-Res Available

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What happens when your farming costs go up, but you don't sell the crops you raise?

Farmers across America are coping with the repercussions of the high cost of energy, with the price of some fertilizers rising faster than fuel-cost increases. However, if the weather cooperates, they also may be able to sell their grains and livestock for record high prices. All in all, they may break even or do a bit better.

Agricultural research centers don't necessarily garner those higher commodity prices.

The seven research centers in Montana that are primarily associated with the Montana Agricultural Experiment Station headquartered at Montana State University make some money from the crops and livestock they raise, but their priorities are conducting livestock and crop research. In particular, their crop variety trials develop lines of seed that feed a pipeline of new varieties. A variety with a new disease or insect resistance or that yields better in our climate traditionally feeds producer profits rather than paying the bottom line at research centers.

"Our farming activities are not always production-oriented, so we don't catch all of the commodity price increases," says Mal Westcott, head of MSU's Department of Research Centers and superintendent of the Western Ag Research Center at Corvallis.

"We do have more leeway now to reap the benefit of our commodity sales than we did years ago," Westcott says. "That does help balance things, but some of the centers don't have enough hard-money budget to cover all the expenses of farming and keep the doors open. We end up going into our research grants to help cover the costs."

Another assistance this year is money approved during the last Montana Legislature. Legislators allocated $50,000 a year for two years to help offset increases in overhead charges. Of that, $40,000 was allocated to the research centers in proportion to each one's energy costs. That two-year aid is helping, Westcott said.

Still, David Wichman, superintendent at the Central Ag Research Center at Moccasin says that fertilizer that cost $150/ton four years ago now costs close to $1,000 per ton.

"High-priced phosphorous is a real problem," Wichman says. "We can increase nitrogen by legumes, but phosphorus affects everything from forage to peas to every other crop. Its high cost is a big deal to farmers and ranchers."

Phosphorus is important on seeded pastures for livestock, too, says Gregg Carlson, superintendent at the Northern Ag Research Center at Havre. Northern is the only research center that includes cattle research in both a rangeland and feedlot setting. It also has the largest acreage of the research centers, with about 125 acres in dryland cropping, 300 acres in irrigated cropping and about 6,535 acres of pasture and rangeland -- roughly comparable to a small Montana combined cattle and grain operation.

"The fertilizer side is absolutely unbelievable," Carlson says. He said overall energy costs at Northern, including electricity, natural gas heating, diesel and gasoline went from $24,760 in fiscal 2003 to $51,770 in fiscal 2007. The average per acre cost of blended fertilizer has gone from roughly $29 per acre four years ago to $86 per acre this year.

At first glance, you'd think roughly 13,500 pounds of manure a day from 300 cows in a feedlot would be a net benefit to offset some of those costs.

Think again.

"Manure is wonderful for its long-term effects on soil health," Carlson says, "but in terms of dollars for pounds of nitrogen, it's not all that wonderful. There are a lot of tons of manure to handle for the nutrient you get, and the management of the manure is highly regulated."

Darrin Boss, who oversees the animal science research at Northern, said that regulations require spreading manure broadly and only in amounts necessary for the following crop.

"Energy costs go up the more broadly you spread and the more you are moving the manure, and you are putting some weed seeds back onto the fields that are still viable after passing through the cattle," Boss said. He said he will compare the costs and benefits of composting the manure compared to spreading it on fields.

Jerry Bergman, superintendent of the Eastern Ag Research Center at Sidney, has an additional problem.

"We're having an oil boom and we are losing support staff because we can't compete with the oil industry salaries," Bergman said. "We have lost both of our field support technicians." A truck driving position for the oil industry was advertised at $21 per hour plus benefits, while starting field staff salary is less than $12 per hour plus benefits.

The superintendents also said that cropping trials away from the station on farmers' fields may suffer in the future due to fuel costs. Round-trip mileage to various off-station sites vary from 50 miles to 300 miles per trip, and often equipment has to be hauled to the site, further reducing the number of miles per gallon vehicles get. Each site requires a minimum of three trips per season: one to plant, one for maintenance and one for harvest.

The distance to sites is indirectly one reason they are selected for research -- the sites need to have different enough soil or climate conditions to provide alternative environments for crop testing.

Research center staff are searching for creative alternatives to reduce costs while continuing to serve their clientele, Westcott said.

"There are avenues for us to explore. All of the superintendents are keeping that in mind," he said.

Contact: Mal Westcott (406) 961-3025 or westcott@montana.edu, Gregg Carlson (406) 265-6115 or gcarlson@montana.edu, David Wichman (406) 423-5421 or dwichman@montana.edu, Jerry Bergman (406) 433-2208 or jerry.bergman@ars.usda.gov