Often neglected in the management of production costs, total petroleum expenditures actually match seed costs in agriculture. Here's why you should pencil them in and track those older # 2 diesel-gulping engines in the field.
Fuel may be considered the lowliest of inputs. Just dump it in and go. However, new research, new engine technology and new petroleum products put it back on the front burner.
"We find very few farmers who know what any one machine will burn," says Kent Lynch, product service engineer, Caterpillar Ag Products. He quickly calculates that at 19 gal./hr, a tractor is burning fuel at $15.20/hr. At 500 hrs. of annual use, that subtracts $7,600 from the bottom line.
"The difference between burning just two gallons per hour less fuel is about a thousand dollars a year and would be more with more hours of use," Lynch says. "I would think that would be worth something to most guys."
Caterpillar isn't the only company drawing attention to fuel and fuel usage. Kinze is also alerting farmers that fuel consumption can be reduced, often dramatically, through newer engine technology. It was an unexpected side benefit of its engine repowering efforts. "Farmers come to us because they want more horsepower. But they're amazed at how much less fuel they burn," says Jim Spaid, head of Kinze's Power Products Division.
Illinois farmers David and Mike McGee were amazed. They first repowered an older 4-wd tractor and then repowered an older 2-wd tractor. "This new engine is even better on fuel efficiency than the other repowered tractor," Mike says. But, like most farmers, the McGees didn't keep any detailed records.
"We're really pleased with that tractor, but have no specific data," Mike says. "But I can tell you that we farmed about 1,800 acres in 1996. And we farmed about 75 acres more in 1997. We used less total fuel with more acres last year."
Newer engines burn less. Driving this renewed awareness to fuel efficiency is a new generation of engine technology. And some of that technology is a result of new emissions standards. As a result, newer diesel engines pack more power in same-size or smaller displacement packages, and have improved combustion and cylinder head airflow. Computer technology is allowing for smarter engines.
Tying it all together is something called electronic unit injectors (EUIs). These diesel engine fuel injection systems can crudely be likened to what happened when automobiles went from carburetors to fuel injection systems. While all engine manufacturers put their own spin on it, EUIs are injectors that electronically spray diesel fuel into each cylinder, individually, on a cylinder-by-cylinder basis, often inside the cylinder head instead of on the outside of the engine. In many cases they are controlled electronically, by a computer chip.
The added heat of the cylinder head, electronic control and individual metering make for super-efficient, precise diesel engines. They are cleaner burning too.
Engines - all agricultural engines - are at least 50% more fuel efficient than just a few years ago, points out Mike Lockart, manager of new market development for Growmark. "It is phenomenal the small amount of fuel they burn."
Injector madness. That same fuel precision, however, can play havoc with injectors and injector pumps. Tractor companies and fuel suppliers both cite injector problems as their number one challenge.
"We do see a lot of injector problems," Lockart says.
He explains that tiny injector tip holes are smaller than the naked eye can see. A drop of water that makes it to an injector tip can instantly turn to steam, due to the high heat, and blow the side right off the tip. At that point the injector shoots a lot more fuel into the cylinder. "It is a melted piston waiting to happen," Lockart says. "I've seen it many times. It is a very expensive repair bill."
Part of the problem, claims Chuck Hamilton of Farmland Industries, is that the higher temperatures inside the head, while beneficial to reduced emissions and fuel efficiency, can potentially cause more oxidation of the fuel. "Temperatures may reach 180 to 212 degrees," he explains.
And repair costs are high. "An injector tip repair used to be in the $35 to $65 range," Hamilton points out. "One of these newer systems can be $350 to $400 to repair, and I've heard costs as high as $900."
However, Neal Ament, senior marketing consultant at Caterpillar, points a finger of blame directly at fuel suppliers. "We find the fuel isn't as clean as it should be. All tractor manufacturers have had problems with injector failures. The petroleum industry has not done a good job of policing itself."
He says that in the last two years, Cat has had to add a double filter system to its engines. It has added a 10- micron primary and 2-micron secondary filter to reduce erosion in injectors.
"One of the leading causes of injector failure is dirty fuel," Lockart admits. "And they (engine manufacturers) don't make any bones about it."
New fuel standards. To do a better job of policing, in July the National Conference of Weights and Measures (NCWM) will vote to adopt testing criteria for what determines a premium diesel fuel. Currently there is no national standard for consumer awareness.
Depending on how it plays out, the upshot of the action could result in a posting at gas-station pumps indicating that what you're putting in your tank is indeed a premium diesel. Like many of these kinds of regulations, this one is embroiled in controversy. At odds are NCWM's recommendations and the Engine Manufacturers Association (EMA) version of what constitutes a premium diesel.
In simple terms, the engine manufacturers' standards are much more extensive than the NCWM's proposal. The EMA's proposal would have refiners meet a full slate of criteria in addition to those of the NCWM.
Any labeling, however, will only appear at the commercial pump level. It does not apply to bulk delivery, which is even more of a reason to buy your diesel from a long-standing reputable supplier you know and trust.
Designer diesel fuel. Diesel fuel suppliers, especially farm cooperatives, argue that their premium-brand fuel is now at or above all standards set by the engine manufacturers and will perform trouble-free in all of today's engines. "And a very high percentage of our buyers do purchase our premium-grade diesel," Growmarks' Lockart adds. "It accounts for about 90% of on-farm sales.
"Agricultural cooperatives as a whole are head and shoulders above everyone else in marketing a premium fuel," Lockart emphasizes. "I think a lot of it goes back to a 'righteous buying attitude,' meaning farmers have pride in their equipment and are very quality conscious. All co-ops have marketed to that way of thinking."
Lockart also says the co-ops "have done a good job of marketing. We've explained the benefits of what's in a premium fuel in the way of additives and benefits to our customers."
Farmland's Hamilton and Mike Derickson, refined fuels marketing manager for Cenex, agree. "Our people will always supply a premium diesel, which already meets or exceeds guidelines set by the engine manufacturers." Farmers need to look for and invest in, according to the co-ops, their respective brand-name premium diesels.
What farmers can do. Besides buying from a high-quality supplier, there are many things farmers can do to keep fuel expenditures and repair costs to a minimum.
Lockart, however, believes the current focus on costing out engine fuel efficiency is being overplayed. For example, he says, "when figuring fuel as a percentage of total input expenses, it is hard to see much difference. And when you consider ground conditions, weather and other factors, fuel efficiency is awfully hard to measure.
"I tried to calculate it for a friend of mine who farms about 1,000 acres and it figured out to about one-half of one percent of total expenditures. Even he was surprised it was that low."
By comparison, Lockart says, fuel cost can range from 25 to 30% of total expense for truckers. "It boils down to three or four gallons per acre for an entire farming operation. You can't even measure it!" he says.
For that reason, Lockart believes, farmers should not be concerned as much with fuel efficiency as with fuel quality and usage. "With the cost to your farming operation that low, it is even more reason to buy top-shelf," he says. The package that is sold to farmers will save money over the long run in maintenance, repair and smooth operation. "The backdoor benefit to that is fuel efficiency."
Caterpillar's Ament disagrees. "All you have to do is look at the drawbar horsepower for the gallons per hour you use. How much work you do with a gallon of fuel is very hard to dispute."
An even simpler way to figure it, Ament says, is by tracking gal./acre. "It is probably the easiest way to figure fuel usage and it doesn't matter what tractor you're running." He encourages comparison so farmers start to know what they burn.
Tidy tips. No matter how much fuel farmers burn, Lockart believes that the petroleum industry needs to build awareness of how farmers store and handle fuel. And it is not just the storage tank sitting in their yards either.
"Transfer tanks, the kind like you take to the field in the back of your pickup trucks, are the absolute worst," Lockart says. "They are far worse than storage tanks." Water and dirt are the top two enemies of diesel fuel. And, a surprise to many farmers, water poses more harm than dirt, Lockart explains.
Hamilton agrees. "Even small amounts of moisture in a fuel tank can cause algae to develop in summer months," he says. "And it can cause ice crystals in the winter. Many times winter fuel problems are frozen water crystals. This is often confused as 'gelling.' Changing filters before winter can often prevent any problems," he says.
To prevent fuel headaches, Hamilton recommends changing fuel filters often. He advises twice a year, before each busy season. Drain the water from all tanks and fuel systems at least twice a year. And, always buy a premium fuel and keep it clean and dry.
"There is a lot of misunderstanding among farmers about the fuel they purchase," Hamilton continues. "If you are buying a premium diesel, you do not need to add extra additives."
In most cases pouring in over-the-counter additives to a premium product will only antagonize the already conditioned fuel. It also adds unnecessary cost to a premium-priced product. Leave your premium diesel alone, Hamilton advises.