USDA Breaks Down Farm Expenses

As Farmers Know, Production Costs Were Higher in 2022 -- Especially for Livestock Producers

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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Farm production costs in 2022 topped $452.7 billion, up 15.2% compared to 2021. USDA highlighted nearly every segment of input costs were higher, but livestock producers bore the brunt of higher costs, mainly due to higher feed values. (USDA National Agricultural Statistics Service chart)

OMAHA (DTN) -- Farm production expenses jumped more than 15% in 2022 with increases in every area tracked by USDA, according to a new report from the National Agricultural Statistics Service.

Farm expenses hit $452.7 billion in 2022, up from $392.9 billion in 2021.

The higher production costs fell the hardest on livestock producers. Feed costs were the largest overall driver of higher expenses, up 18.5% from 2021. Other "farm services" rose 10.8%, while livestock, poultry and related other expenses were up 10.1%. Labor costs were 9.2% higher.

The total farm expenditure per average farm in 2022 was $226,986, up 15.8% from $196,087 in 2021.


Livestock farms saw expenses increase 18.1% in 2022 to $218.9 billion. Feed topped the expenses at $81 billion, while other livestock, poultry and related expenses were $43.2 billion, and farm services were $20 billion. The average total expense for a livestock farm was $200,359.


Crop farm expenses were $233.8 billion, up 12.6% from 2021. Farmers spent $31.9 billion on fertilizer, lime, and soil conditioners; $29 billion on labor; another $28.6 billion on farm services; and $26.7 billion on rent. Combined crop inputs -- chemical, fertilizers and seeds -- cost $73.4 billion, or 31.4% of total expenses.


Total fuel expenses were $17.4 billion nationally. That includes $11.4 billion in diesel costs, which were $35.4% higher than 2021. Gasoline costs were $3 billion, up 22.2% from 2021. LP gas was $2 billion on costs, up 41%.

Fertilizer, lime, and soil conditioner costs topped $36.8 billion for the year, up $7.3 billion from 2021, or 19.8% higher. Farmers in Midwestern states accounted for $15.8 billion in fertilizer costs, about $4 billion higher than 2021. Nationally, fertilizer accounted for 8.1% of total expenses.

Fertilizer costs have been coming down over the past year as the DTN Retail Fertilizer Trends column highlights. See….


California had the highest expenses of any state in the country at $46 billion. Labor made up the biggest expense for farmers in the state at $12.36 billion.

Iowa came in second with farm expenses at $35.68 billion. Feed was listed as the largest expense at $7.9 billion. Other livestock-related expenses came in at $5.3 billion. Rent topped $4 billion.

Texas was third with expenses at $29.87 billion. Feed costs were the largest expense in Texas at $6.2 billion, while other livestock-related costs were $5.7 billion.

Nebraska was fourth with expenses listed at $28.53 billion. Livestock-related expenses were $6.7 billion with feed costs at $4.5 billion. USDA shows rent costs in Nebraska declined $50 million to $2.92 billion.

Kansas was fifth with expenses at $24.69 billion. Livestock-related expenses topped $7.1 billion with feed costs at $5 billion. Rent expenses in Kansas dropped to $1.41 billion from $2.1 billion in 2021.


While the average cost per farm was $226,986, nearly 62% of costs involved farms with $1 million in sales or higher.

Farms with sales from $1 million to $4.99 million accounted for 32.9% of farm expenses, or an average of $2.16 million in costs per farm. They made up the largest overall segment of farms with $149 million in overall expenses. Their average costs rose more than 18% over the year. Feed costs rose $6.8 billion for these producers. Fertilizer costs were up $3.2 billion, and labor costs also rose $2.9 billion.

Farms with sales topping $5 million accounted for 28.9% of all expenses, but their average expenses topped $14 million per farm. These farms accounted for $130.77 million in expenses. Their costs rose an average of 10.5%, year-over-year. Feed costs rose $7.4 billion. Fertilizer costs were up $800 million. Agricultural chemicals were up $600 million. Surprisingly, labor costs for the largest farms only rose $200 million to $17.7 billion.

For the full NASS expense report, go to….

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Chris Clayton