At 8.5 percent, the general inflation rate is at its highest level in years, but Bell Bank Senior Vice President of Agribusiness Development Lynn Paulson thinks the inflation rate for production agriculture is much higher. “When you’re talking about doubling the price of fertilizer, chemical, fuel and all of the things that go into raising crops or livestock, inflation rates are higher,” says Paulson. “The other part is with 8.5 percent inflation, at some point that will start reducing demand for high end agricultural products like beef and other things that aren’t necessities.” Without question, this will be the most expensive crop in history to produce. The high commodity prices are offsetting concerns for this year, but the worry comes late. “In 2023 and 2024, if commodity prices reset; input prices take longer to reset. We’re making long-term decisions on short- term events and that’s something we probably need to pump the brakes on a bit.”
