Global demand also puts pressure on price, putting dent in farmers' profits.

By Dennis Pollock / The Fresno Bee

The nation's appetite for ethanol continues to bring consequences that ripple through the farm economy.

Growers planting nitrogen-gobbling corn needed to make the alternative fuel are causing prices for fertilizer to spike and farmers of many crops to grumble.

Dairy farmers earlier lamented a rise in feed costs of as much as 25% to 35% from a year ago. The Kiplinger Agriculture Letter said soaring ethanol output has reduced grain supplies, and droughts have cut hay stocks.

Now comes a chorus of complaints about nitrogen fertilizer costs, blamed not only on ethanol but also on global demand for fertilizer.

"Two years ago, the cost [for liquid nitrogen fertilizer] was $165 to $180 a ton. Last year it was $250 a ton. This year it's $340 a ton," said Paul Betancourt, who grows almonds and cotton in the Tranquillity area. He said the extra $10,000 he'll pay this year for fertilizer will put a significant dent in his profit.

Betancourt said part of the problem is that land across the country that previously had been used for soybeans, which don't rely on nitrogen fertilizers, is being used to grow corn to stuff the nation's voracious ethanol maw.

That appetite has helped push the nation's corn crop toward a record this year -- with farmers possibly planting as much as 90 million acres, or an area about the size of Montana, said Jay Yost, vice president for Independent Agribusiness Professionals in Fresno . That compares to about 82 million acres last year and would be at the highest level since 1944, when 95.5 million acres were planted. Yields per acre, it should be noted, have increased significantly in those more than six decades.

Corn requires more nitrogen than most crops, Yost said, and demand is particularly high in the Midwest, the nation's Corn Belt . In California , much of the corn grown is for silage, not grain.

Yost said worldwide demand, notably from, came even before the appetite heated up in the .

"When started buying big time, prices took off and haven't stopped," he said.

Yost said the fact that subsidizes farming also has tweaked the pricing picture: "If it were totally supply and demand, we would have seen some people back off."

The challenge to farmers, said Harriet Wegmeyer, a spokeswoman for the Fertilizer Institute, is "they are competing against farmers in and . It's a global market."

Yost said population growth and the need for food continues to drive the demand for fertilizer. And, increasingly, developing nations such as and have a stronger appetite for higher-quality foods, which often require additional fertilizer.

Other major consumers of nitrogen fertilizer include , the second-largest ethanol-producing nation in the world after the . produces nearly all of its ethanol from sugar cane.

According to Mosaic, a major producer of phosphate and potash headquartered in Minneapolis, corn used for ethanol production has increased from 700 million bushels in the 2001-02 growing season to a projected 2.2 billion bushels this year.

The percentage of the corn crop turned into ethanol has increased from 7% five years ago to 20% in 2006-07, the company noted in a report called "The Global Fertilizer Outlook: Implications for North American Retailers."

Wegmeyer said while there is not yet a shortage of nitrogen fertilizer, there is "very high demand and a very tight market."

Also contributing to the price spike is the cost for natural gas, which Wegmeyer said is the feed stock for ammonia used to make nitrogen fertilizer. The Washington, D.C.-based Fertilizer Institute she represents has supported efforts to develop more gas supplies to bring down the cost.

Lobbyists for the agriculture and fertilizer industries were major backers of a bill passed late last year to open land off the eastern Gulf of Mexico to gas and oil drilling.

In the short term, there is little farmers can do to get around the higher costs for nitrogen fertilizers.

Rod Yraceburu, a pest control adviser with Wilbur Ellis Co. in Helm, said nitrogen fertilizers account for about 10% of the costs of farming, although the percentage can vary from crop to crop and from one farming enterprise to another.

One of Yraceburu's customers, John Peelman, said he is trying get more bang for the bucks he spends on fertilizer this year by using a foliar spray in his vineyard in west Fresno .

The cost for that spray is now on a par with other applications, he said, and it should be more efficient to apply the nutrients to the plant rather than through the soil.

Gene Nord, a grower south of Kerman , said his added fertilizer costs will amount to nearly $5,000 this year, and he sees no end in sight: The nation is "going to need beaucoup fertilizer for the corn."

Jim Barham, a pest control adviser with GAR Tootelian Inc. of Reedley, said many fertilizer manufacturers are no longer in the . That means added costs for freight.

"California is 100% dependent on imports," said Renee Pinel, president and CEO of the Western Plant Health Association in Sacramento .

Some central San Joaquin Valley farmers can capitalize on another fertilizer source in their backyard: manure from poultry or cows. But use of those alternatives appears to be limited.

"Most dairy producers use all of their manure as fertilizer on their own farms, and that has helped them," said Michael Marsh, who heads Western United Dairymen in Modesto .

As the dairy operators use the manure, they must test for nitrogen content to make sure they are not exceeding levels that could be harmful for ground water or so high it could harm their crops.

Hanford dairy operator John Mello said he provides dried manure to a grower of cotton and corn in exchange for some "tractor work."

"There's more of a demand now because of the increased cost and because you get a lot more things out of the manure than commercial fertilizer; it builds the soil," he said.

In some part of the Midwest , the high cost of commercial fertilizers has increased interest in using poultry litter to grow crops. But in California, Bill Mattos, president of the Modesto-based California Poultry Federation, said he was not aware of any surge in the use of the manure in California as an alternative.