$7 Diesel Price Forecast Sparks Concern for Farmers

Kansas State University ag economist Gregg Ibendahl has predicted that diesel prices could hit $7 in 2027. He attributes this forecast to ongoing global production and refinery issues, which would take an additional 12 months to resolve even if solved today.

Ibendahl points out that the lack of U.S. refining capacity, the conflict in the Middle East, and the Russian/Ukraine war have contributed to higher prices. He notes that Russia's diesel exports have been severely impacted by the ongoing conflict.

Ibendahl emphasizes that farmers are limited in their options for reducing costs due to the essential nature of diesel fuel for grain production. According to him, 'You really just can't say I'm going to cut back because we're already doing a lot of no till or minimum till.'

The economist recommends allowing the market to act independently from government involvement, rather than attempting to mitigate prices through intervention.