Last week I was driving north on Hwy. 1 in Mississippi, and my truck’s fuel gauge indicator had slipped well below my personal comfort level of an eighth of a tank. In the town of Rosedale, I finally found a gas station that took a credit card and subsequently suffered the humiliation of ringing up $90 and some change at the pump.
That’s right, ninety bucks.
As of today, $90 will buy dinner for me and my wife at a very nice restaurant, or a month of cable, or a night at the movies for a large family with popcorn and soft drinks, or three or four nice cotton shirts, or a 30-second lecture from my doctor.
But to spend $90 all at once on fuel is ludicrous. In 1971, a quarter and a 1965 Volkswagen would take me from one side of Memphis to the other. Today’s quarter would turn to fumes before it hit the bottom of the gas tank.
Of course, what I spend on gasoline hardly compares to what is spent to manage and produce a commodity crop, especially when things turn dry like they have. Over the last few weeks on parched Mid-South soils, diesel power has been pushing water down the rows or spinning it in constant circles.
Some farmers have already run through their fuel budgets with half a season or more to go.
Fuel costs, which have almost tripled since 2001, have become an incredibly large expense item for farmers. To survive the high cost environment today, farmers not only need continued high commodity prices, but they have to be efficient, well-financed and dialed into making the highest yield possible. The profit margins may be better than they’ve been in a while, but the margin for error is significantly greater.
U.S. farmers aren’t the only ones hamstrung with high costs. Poor farmers in developing countries want to take advantage of high commodity prices, but simply can’t afford to plant anything. It speaks of a world economy spinning toward a crash or major correction.
Either way, this might be a good year for putting a little cash away — something a little rainfall could help.
Along that line, meteorologist Jed Lafferty, managing director of life sciences at Planalytics, a private company that provides weather intelligence and insight to a wide range of businesses, says the United States will return to more traditional weather patterns in July.
The focus of the heaviest precipitation will be “out of the Plains and into Texas and the Southeast where we will see continued improvement in recovery from the drought that hit the region last year. Unfortunately, the potential for tropical storms will be elevated compared to normal.”
Let’s hope he’s right about getting adequate precipitation throughout the South and wrong about the possibility of more hurricanes.
Meanwhile I have a 5-gallon gasoline container for lawnmower use that still contains some precious fuel purchased last year at a little over $2.25 a gallon. I’m thinking I should just keep it as an investment. Unless someone can recommend a good mutual fund that’s appreciated 77 percent.