Cost of oil draining ‘lifeblood of the American farmer,’ NJ family owned-business says
The farmers warn they will be forced to pass increased input costs to consumers
Fuel 'lifeblood of the American farmer': NJ farm owner
The brothers who own Doladson farms in N.J. discuss the impact of inflation and warn that they will have to pass on rising costs to consumers.
The brothers who own Donaldson Farms in New Jersey discussed the impact of skyrocketing inflation on their business and warned that they will have to pass on rising costs to consumers.
In interviews with former congressman and Fox News contributor Sean Duffy, which aired on "FOX Business Tonight" on Wednesday, Gary, Greg and David Donaldson explained the impact of their increased input costs for everything from oil to labor.
Fuel "is probably the lifeblood of the American farmer," the Donaldson brothers noted, stressing that they use it "every day for just about everything we do."
They said that last year a 25-pound bag of fertilizer cost them $30 a bag, and now it’s around $50 a bag.
The brothers pointed out that the cost of plastic, used in planting pots and greenhouse coverings, is soaring as well.
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The brothers provided the insight one week after it was revealed that inflation hit a fresh 40-year high in February.
Donaldson Farms in New Jersey (Google Maps / Google Maps)
The consumer price index climbed 7.9% on an annual basis, according to data released last Thursday by the Bureau of Labor Statistics. Month over month, inflation rose 0.8%.
From January to February, nearly every category of goods and services got pricier, with gas accounting for almost a third of price hikes. Grocery costs jumped 1.4%, the sharpest one-month increase since 1990, other than during a pandemic-induced price surge two years ago. The cost of fruits and vegetables rose 2.3%, the largest monthly increase since 2010.
For the 12 months ending in February, grocery prices leapt 8.6%, the biggest year-over-year increase since 1981, the government said.
The February data was taken before Russia's invasion of Ukraine, which caused the price of oil to surge further.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| USO | UNITED STATES OIL FUND - USD ACC | 72.10 | -2.15 | -2.90% |
| BNO | UNITED STATES BRENT OIL FUND - USD ACC | 29.07 | -0.75 | -2.52% |
On Thursday, U.S. West Texas Intermediate (WTI) crude topped $100 per barrel, while Brent, the global benchmark, hit $105.
The Donaldson brothers pointed out that increased labor costs in the area are impacting their business as well, noting that a department store nearby now has a starting wage of $24 an hour, which makes it hard for them to retain workers unless their wages are on par.
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They also said that taxes and regulations add other challenges, noting that they would like to expand upon their retail business, "but with the regulations and getting approvals, sometimes it just puts that cost that much higher."
The brothers also pointed to problems with the renewable energy push from the government, noting that solar panels "are going up all over on farms [and] are taking up prime farmland."
While they are moving towards renewable energy, they urged the government not to "shove it down our throats" and to "see what’s going out here in the real world."