Updated

Updated · CBS New York · Jul 11

Louisiana Farmers Face $130,000 Cost Overruns as Iran War Lifts Fuel and Fertilizer Prices

Updated

Updated · CBS New York · Jul 11

Louisiana Farmers Face $130,000 Cost Overruns as Iran War Lifts Fuel and Fertilizer Prices

Q: As a global trade crisis cripples farmers, which domestic industries are unexpectedly thriving from the disruption?

The clearest domestic winner is the U.S. biofuels sector, with some spillover gains for domestic energy producers and transport operators. The farm story itself points to biofuels as a rare bright spot: despite collapsing margins for growers, high crude prices and the EPA’s March 2026 renewable fuel rule have strengthened demand for biodiesel and renewable diesel, helping support U.S. grain and oilseed markets, especially soybeans. That does not erase farmers’ pain from fertilizer and fuel costs, but it does create a domestic demand floor for some crops at a time when export-driven support is weaker. Searched reporting also indicates that U.S. oil and gas producers are benefiting from the same disruption that is hurting agriculture. With the Strait of Hormuz crisis pushing up global oil and jet fuel prices, domestic producers are profiting from higher prices and faster U.S. shale output. In practical terms, that means the energy shock squeezing Reed Keahey’s fuel bill is simultaneously improving conditions for parts of the domestic petroleum industry. There are also narrower gains in domestic logistics. As maritime routes become more expensive and unreliable, some freight shifts toward trucking, intermodal rail and warehousing, sectors that benefit when companies reroute cargo and hold more inventory. So while the dominant story is farm distress, the industries unexpectedly doing better are mainly biofuels, domestic oil and gas, and selected U.S. logistics businesses.

3 articles · Updated · CBS New York · Jul 11

$120,000 to $130,000 in extra urea costs has pushed one northeast Louisiana farm over budget, with the owners saying survival is "real close."
Jet-A fuel for agricultural flights climbed from $2.46 a gallon in February to a May peak of $4.11, forcing pilot Reed Keahey to spend just over $30,000 on a 7,500-gallon fill-up.
Those increases trace to the Iran war, which disrupted Persian Gulf shipping through intermittent Strait of Hormuz closures; the waterway carries about 20% of global oil, and the region supplies nearly half of urea exports.
Keahey said he is absorbing the higher fuel bill rather than charging farmers more, underscoring how little margin remains across the local farm economy.
The squeeze is hitting an already fragile sector: the American Farm Bureau Federation said U.S. farm bankruptcies rose 46% last year from 2024.