Trump may see high gas prices as 'peanuts,' but they are squeezing lower-income Americans the most

Photo by Yassine Khalfalli, Unsplash

In a frustrated remark, President Donald Trump referred to surging gas prices across the U.S. as "peanuts" compared to the threat of Iran producing a nuclear warhead.

And while many Americans might agree that wallet-draining gas prices are preferable to horrific global outcomes, the war is costing poorer Americans a higher percentage of their income than it is wealthier Americans.

"For households in the bottom quarter of the income distribution — those earning roughly $40,000 a year or less — commuting fuel costs now consume an average of about 4% of their income," report Julie Z. Weil and Federica Cocco of The Washington Post. "For households in the top quarter, earning $100,000 or more, the same costs amount to less than 1%."

Lower-income workers get squeezed from all sides when gas prices increase. "They tend to live farther from their jobs, in areas with little or no public transit, and are more likely to drive older, less fuel-efficient vehicles," the Post reports. For most, working from home is not an option, leaving them unable to escape the need to buy gas — no matter the price. The only other option is to skip work, doctor's appointments or social outings that require a car fueled by gas.

The more than 40% increase in gas prices from May 2025 to the present has left some lower-income Americans facing tough choices. Debbie Zambrana, who lives on a fixed disability income, used to help her son out by driving his children to school events. Weil and Cocco write, "For the first time, she recently told him that she could only drive them if he covered the fuel."

With gas prices recently reaching $4.50 a gallon, there is little low-income workers can do to help themselves — even when they budget carefully. "Personal finance experts commonly advise that people shouldn’t spend more than 10% of their after-tax income on commuting expenses," Weil and Cocco add. "Spending 4% of income on gas alone can quickly throw everything out of whack."

Ag round-up: Nearly 70% of farmers can't afford fertilizer; union and JBS reach deal; real help for stressed farmers

Share of farmers unable to afford all required fertilizer. (American Farm Bureau Federation graph)

Nearly 70% of American farmers report they can't afford all the fertilizer they need this season because of increased input prices due to the war in Iran and an already stressed farm economy, according to an April survey of 5,700 farmers by the American Farm Bureau Federation. "Farmers in the Southern region reported the greatest difficulty securing fertilizer, with 78% unable to afford all needed inputs this season," reports Faith Parum of AFBF. "Producers in the Northeast and West also reported significant challenges, with 69% and 66%, respectively, unable to afford all required fertilizer, compared to 48% in the Midwest.”

In an effort to drill down into why fertilizer prices have increased so dramatically since 2021, the U.S. Department of Agriculture is "working with the Department of Justice and the Federal Trade Commission on ongoing investigations into fertilizer and other agricultural input costs," reports Chris Clayton of Progressive Farmer. USDA Deputy Secretary Stephen Vaden has "continued his criticisms about concentration in the fertilizer industry, calling out The Mosaic Company for announcing it will close phosphorus mines in Brazil. . . . Vaden argued the global market is signaling a need for more supply -- not less. He questioned why a major producer would scale back output under those conditions."

The Greeley plant can process roughly 6,000
cattle per day. (Photo by L. Angharad) 

The local union representing roughly 3,800 beef plant workers in Greeley, Colorado, and meatpacking giant JBS announced a new labor contract agreement early this week, reports Patrick Thomas of The Wall Street Journal. Beef plant workers went on strike on March 16, "seeking higher wages and other workplace changes. . . . The Colorado plant can slaughter about 6,000 cattle a day, representing roughly 5% of U.S. beef-processing capacity." The new agreement includes worker wage increases through 2027 and protects employees from having to pay for their own required protective equipment. The last slaughterhouse strike happened at a Minnesota Hormel plant in 1985. 

Despite the multiple pain points for American soybean farmers in 2026, some of the rising input costs and sinking soybean prices have evolved over the past several years -- only to be exacerbated by tariff levies and the war with Iran, report Eric Ferkenhoff of Lee Enterprises and Josh Kelety of The Associated Press. "Costs, such as equipment, have crept up over time while soybean prices have stayed low." Doug Bartek, a fifth-generation farmer, told reporters, "Our biggest struggles are our inputs, be it fertilizer, seed, chemical or parts. There has been so much drastic markup in all of these. And I just kind of feel like the farmer’s kind of painted in the corner." Many Midwest soybean producers share Bartek’s worries.

Real Farmer Care wants to give farmers the means to
care for themselves. (Graphic by A. Dixon, Offrange)

Are you a farmer in need of some downtime? Do you know a stressed-out farmer who might be forgetting to care for themselves because they're tending to everything else? If either answer is yes, consider nominating yourself or another farmer-in-need-of-care for one of Real Farmer Care's $200 microgrants, writes Nicole Caruth for Offrange. "Think a stress-relieving massage, a pair of sturdy work boots, or just a dinner outing with friends. The grants are small, but can potentially have a big impact." From squeezing tariffs to eye-popping fertilizer costs, U.S. farmers are having a rough year. The brief nomination form is here. 

Why the closed Strait of Hormuz will increase grocery prices and add to world hunger

Goods and fuel normally flow out of the Persian Gulf and through the Strait of Hormuz. (Wikimedia map)

As the U.S.-Israeli conflict with Iran continues through the spring planting season, Americans and the world at large are likely to see food costs increase as farmers who would normally be fertilizing their soils for corn seed may change their planting choices, writes Aya S. Chacar, an expert on how institutions affect businesses and supply chains, for The Conversation.

Part of the increased expenses will come from fertilizer costs or from reduced crop productivity due to reduced fertilizer supplies during planting season. "Three staple crops – corn, wheat and rice – supply more than half of the world’s dietary calories. To maximize production, those crops need three main nutrients: nitrogen, phosphate and potassium," Chacar explains. "The closure of the Strait of Hormuz has reduced the supply and increased the cost of all three."

Faced with soaring fertilizer prices, farmers will have to choose how much nitrogen-hungry seeds like corn to plant and when. "Reducing nitrogen application by 10% to 15% or delaying application by 2 to 4 weeks can reduce corn yields by 10% to 25," Chacar writes. Less food for people also changes what foods are available for livestock and its cost. Higher grain costs to feed cattle, for instance, will increase the price of beef. In the end, consumers will see prices increase.

While Americans have seen gas prices increase in real time as the war continues, more expensive food prices will take longer to emerge, but they will come all the same. Chacar adds, "In March 2026, the U.S. Department of Agriculture used data from before the Iran war to project a 3.1% average increase for all food prices."

Beyond fuel costs, corn prices are likely to be a primary driver of grocery price increases. "Corn tortillas and other relatively lightly processed corn foods are more likely to show price responses within a few months after corn prices increase," according to Chacar. Cereal and meat price increases will take a bit longer to reach consumer pocketbooks.

Should the Strait of Hormuz remain closed, the resulting fertilizer shortage will be a global problem, as it will affect American crop choices and yields. Chacar writes, "More than 300 million people worldwide already do not have enough food. The U.N. World Food Program predicts an additional 45 million could join them by the end of 2026 if the conflict in the Middle East continues into the middle of the year."

Farming fertilizer stuck in the Strait of Hormuz leaves U.S. farmers roughly 25% short of needed supply

The U.S. fertilizer supply system doesn't have fertilizer 
reserves. China's does. (Photo by L. King, Unsplash)

As the U.S.-Israeli conflict in Iran continues into its third week, fertilizer supplies needed by U.S. and Canadian farmers remain strangled in the Straight of Hormuz. 

The loss of fertilizer imports in March catches farmers at a time when they are planning their spring planting rotations, reports Ed White of Reuters. "More than 30% of world nitrogen fertilizer exports, as well as fertilizer components like sulfur, pass through the now effectively closed Strait of Hormuz."

Besides delaying fertilizer supplies, the war has caused existing fertilizer prices to surge. White writes, "Any available [fertilizer] supplies have spiked more than a third since the war in Iran paralyzed global trade."

Farmers in both countries can scarcely afford the disruptions, since high input, labor and fuel costs already have many farms operating with razor-thin profits or at a loss. Unlike China, U.S. fertilizer suppliers "do not hold strategic reserves of fertilizer," White adds. The lack of reserves leaves American planters vulnerable to global supply chain shortages and price volatility.

Corn and wheat crops require liberal doses of synthetic urea to grow healthy yields. White reports, "The U.S., which in some years imports half of its urea fertilizer, is about 25% short of the usual supplies that farmers buy for spring planting, according to The Fertilizer Institute, which represents the U.S. fertilizer supply chain."

Even if the Strait of Hormuz opened today, some of the fertilizer bottle-necked there might be rerouted to countries willing to pay more. Josh Linville, a fertilizer market analyst at StoneX, told Reuters, "Not only am I worried about incoming vessels being turned around to other, better-paying destinations, there's ⁠an argument to be made, if somebody was willing to go and buy up (supply on) barges, to load them onto a vessel and export it."

"The American Farm Bureau Federation warned that fertilizer supply shortages could hit the ⁠U.S. food ​supply," White adds. "Most fertilizer needs to be applied before the crop starts growing, so any supplies arriving ​too late cannot be used ⁠for the 2026 crop."