Gayle Kaalberg, a farmer, and president and CEO of Farmers and Merchants Savings Bank, Lone Tree, Iowa, operates in a region where processors and river terminals are having a tug-of-war over crops.
Growers will show good profits for the second year in a row in 2007, he
.That's in spite of some areas where four-foot-tall corn was submerged in water, yet later yielded 150-160 bushels.But the outlook for 2008 isn't nearly as cheerful.
"We're right on the bubble of higher costs," Kaalberg
said.Higher diesel prices mean he
paid $11,500 more to fill up a 7,000-gallon tank than he
did five years ago.Even when operators buy by the semi load to qualify for bulk discounts, pricing errors can turn into big-ticket expenses.
"If we have a big drop in prices today, a lot of operators would have trouble breaking even," he