Agricultural Economics Department


Date of this Version

June 2006


Published in Cornhusker Economics, 06/21/2006. Produced by the Cooperative Extension, Institute of Agriculture and Natural Resources, Department of Agricultural Economics, University of Nebraska–Lincoln.


The increase in machinery costs this year has created uncertainty about what are fair costs for custom services. Fuel costs certainly are a major factor, but the purchase or “sticker” prices of machinery and the repair costs have increased as well. Fuel costs have increased about 46 percent over the past two years since the last Custom Rates surveys were taken in the Spring of 2004. Over the same period, overhead costs which include taxes, interest and insurance went up 14 percent and labor costs increased 10 percent. These increases are measured by input cost indexes reported by USDA’s National Agricultural Statistics Service. Fuel costs may account for less than 10 percent of the total costs of some field operations such as planting or as much as 20 percent of total costs for operations such as combining.