Drought, fuel costs hit NC farmers hard

North Carolina farmers are being squeezed from every direction, between hurricanes and tariffs, with the latest attacks coming from drought and rising diesel and fertilizer prices, according to Steve Troxler, Commissioner of the North Carolina Department of Agriculture & Consumer Services.

“I talk with farmers just about every day, and the drought conditions plus high input costs, including fertilizer and fuel, are major concerns for them,” Troxler, told the Carolina Journal. “Both the high input costs and drought could have sizable impacts on the bottom line for growers. I don’t know if any farmers have a pencil sharp enough to pencil in a profit on commodity crops the way things are right now.”

As of May 12, much of the state has been in “extreme drought,” the highest category, with the remainder of the state being in “severe drought,” and a handful of counties being in only a “moderate drought,” according to the North Carolina Drought Management Advisory Council.

Mike Jones, a North Carolina farmer, located about an hour outside of Raleigh, told the Carolina Journal that water management has not been well executed at the state and national levels, and that here in North Carolina, water infrastructure has been built for centuries. North Carolina has had droughts for as far back as anyone can tell.

“In the 50s and 60s, they knew North Carolina was going to need more water, so not only did we not increase our water infrastructure to face rising demand, but we also reduced our existing capacity, so North Carolina has less water holding capacity now than it had 50 years ago,” said Jones. 

“Right now, North Carolina farmers are facing a perfect storm of challenges,” said Kelly Lester, policy analyst for the Center for Food Power and Life at the John Locke Foundation. “Ongoing drought conditions across much of the state are stressing crops, reducing yields, and forcing farmers to make difficult decisions about irrigation and planting. For many producers, especially smaller family farms, one bad growing season can have financial consequences, leading some to close up shop for good.”

“At the same time, diesel prices and fuel costs driven by global instability and conflict overseas continue to impact everything from running tractors and irrigation systems to transporting products across the country.,” she added. “Fertilizer, equipment, and other essential inputs are still far more expensive than they were just a few years ago, while farmers often have little ability to pass those costs on to consumers.”

Farmers are also facing rising fertilizer prices due to supply chain disruptions caused by global turmoil. 

“I put out some fertilizer in the fall of 2024, and I put some fertilizer out in the spring of this year, and both times when I put the fertilizer down, it did not rain for weeks and weeks. So, then your fertilizer doesn’t have the same impact because eventually it volatilizes, dissipates, or goes away,” said Jones. “It’s less effective if you really need some rain and really fertilize, and you talk about high fertilizer costs, well, fertilizer that has no effect is the most expensive fertilizer.”

Lester explained that global conflicts often create ripple effects far beyond the regions directly involved, impacting economies and consumers worldwide. She pointed to the current conflict involving Iran as a prime example, noting that roughly 20% of the world’s oil supply moves through the Strait of Hormuz, making instability there a potential threat to global energy prices and everyday costs.

“Diesel fuel powers nearly every stage of crop production, including soil preparation, planting, irrigation, harvesting, and on-farm transportation,” wrote Lester.  “As a result, fluctuations in diesel prices translate directly into changes in farm operating costs. Farm machinery such as tractors and combines consumes substantial volumes of fuel during peak production periods. In large-scale operations, even small increases in diesel prices can add thousands of dollars to seasonal operating expenses. Rising energy costs also indirectly affect agriculture by increasing the price of other key inputs, such as fertilizers, irrigation, and transportation services.”  

Jones told the Carolina Journal that he has been hit by rising diesel prices, both directly and indirectly. 

“Directly obviously, having diesel go up more than a dollar a gallon, I use a lot of diesel fuel so that was expensive, and then everybody that I work with now that they’ve raised their prices, like anybody who delivers, says we’re going to charge for delivery because fuel is higher, so both direct and indirect, the diesel prices have lowered my profitability.”

Jones had heard of several farmers in the area who, back at Christmas time, were still planning to farm but were unable to secure financing and had to auction off their equipment.

“Trade uncertainty and tariffs only add more pressure,” concluded Lester. “North Carolina agriculture depends heavily on access to foreign markets, particularly for products like pork, poultry, tobacco, and sweet potatoes. When tariffs and war disrupt those markets or create uncertainty for buyers overseas, it is often farmers here at home who pay the price. Agriculture is one of the most trade-dependent industries in our economy, so even small disruptions can have major consequences. It is baffling that farmers are expected to absorb all of these pressures at once while continuing to feed the country and keep rural economies alive.”

Jones warned that without policy or market changes, more farmers could be forced to sell their land to housing developers or larger agricultural operations, as smaller farms struggle to withstand mounting economic pressures. He said the trend could further shrink the agriculture industry and accelerate the loss of farmland in North Carolina, where preservation of agricultural land is already an ongoing concern.

“Drought, fuel costs hit NC farmers hard” was originally published on www.carolinajournal.com.