LUBBOCK, Texas (RFD NEWS) — Rising activity in the oil and gas sector is signaling renewed pressure on farm input costs, as higher energy prices and production expenses begin to work their way back into diesel, fertilizer, and chemical markets.
New data from the Dallas Federal Reserve shows energy activity expanded in the first quarter of 2026, with its business activity index turning sharply positive. At the same time, input and development costs increased, reflecting a more expensive operating environment for energy producers.
That matters on the farm because fuel and fertilizer costs are closely tied to energy markets. Diesel prices have already moved higher, and fertilizer production — especially nitrogen — remains sensitive to natural gas costs.
Oil price expectations near $74 per barrel suggest energy costs are unlikely to retreat significantly in the near term, even as production levels remain mostly flat. Elevated uncertainty in the sector also points to continued volatility.
For producers, the shift reinforces the need to closely monitor input costs as 2026 budgets take shape.
Farm-Level Takeaway: Higher energy activity likely keeps fuel and fertilizer costs elevated.
Tony St. James, RFD NEWS Markets Specialist
The ACRE Act modestly reduces farmland borrowing costs now, with more savings possible once federal guidance clarifies which loans qualify.
November 15, 2025 03:00 PM
·
USDA released the November WASDE Report on Friday, the first supply-and-demand estimate to drop since September, just before the 43-day government shutdown.
November 14, 2025 12:22 PM
·
AFBF economist Faith Parum breaks down the potential impact of the proposed policy change to allow year-round sales of E15 biofuel.
November 13, 2025 02:34 PM
·
David Hardin with the Indiana Soybean Alliance discusses USMEF’s push to open new global export markets for both meat and soy-based feed.
November 13, 2025 01:10 PM
·
Some sustainability shifts are not particularly challenging and can be implemented with resources already available to farmers and ranchers on their operations.
November 13, 2025 01:00 PM
·
With the U.S.–Vietnam agreement nearing signature, U.S. cotton, corn, and soybean exporters could lock in new demand lanes just as global supply shifts.
November 13, 2025 11:33 AM
·
