I’ll try to answer your question from a farming perspective moreso and financial less so.
Australia has mostly poor soil.
My family farms Beef now small scale, and used to farm dairy. They used to use a diesel pump to pump water around the dairy farm into paddock troughs. They do use urea on the grass each year to improve grass yield to ensure more feed to feed/grow more animals per acre. And to harvest more hay/silage per acre to cover winter and early spring feed deficit. Buying in feed can be horrendously expensive, especially when everyone wants it at the same time, and it is trucked from 100’s or 1000’s of km away - diesel once again. A while back coming into what looked like a dry spring/summer they sold off a few head to reduce pressure and cash in, and have now bought replacement stock back on.
Australia is a large country and there are idiosyncracies to each area and type and size of farming operation.
Local climates, rainfall or lack thereof, bushfire damage in one area, flooding in another area, both of which damage farm and minicipal infrastructure including rail, road and brisges, cost of fuel, distances - cost of transport for feed/fert inputs, spares, and transporting feeds and the end product from farm to market, saleyards, abbatoirs etc., to supermarkets or shipping overseas - oof. Everyone takes a cut which adds to consumer price, cattle truck, sale yard fees, selling agent fees, abbatoir processing fees, transport to supermarket. We really need to process on farm and sell local. But the rules are against that.
And farmers being the great folk they are, send their own stored hay as donations or sales to other farmers in those flooded/burned regions.
So a well stocked region can have recently divested itself of some of next winters cattle and sheep food security by donating hay and silage to recently burned areas. Many animals also need euthanasing on humane grounds after bushfire injury. And you don’t necessarily just go buy replacements when everyone else in the area want them too (or you have no feed growing back yet anyway) - supply and demand increases per head price just to restock what is lost. Reduced ewe and heifer numbers mean reduced reproductive capacity for the following year to simply building a herd back up to the numbers where it was, before even selling to other farms or onto the market for food. I think I read somewhere Australia has its lowest sheep stocking numbers on record. That does not bode well for the price or availability of lamb.
Fuel on farm is a lesser problem for beef or sheep farmers than croppers.
Animal farmers can manually roll out bales or let animals into a feed trough area to feed. It’s easier to feed out from a tractor but you can use manual labour if really necessary. Takes longer and is much harder physical work, especially in the middle of a cold, wet, muddy winter. Or after a bushfire. Ask me how I know. Aussies don’t barn their herds like some European countries do so winter weather really increases need for feed in some areas.
Croppers of grain and veg use huge amounts of diesel to deal with stubble from previous year, prepare the ground for a new season, sow broadacre seed and fertilise and spray against weed competition and insect pests.
There are parts of Aus at the moment where farmers are saying they do not have diesel to carry out cropping. Sowing time is sowing time. And they could be about to miss it.
Even if crops go in, there may not be fertiliser to spread, or fuel to spread it with, and there may be pest problems if spraying doesn’t occur.
These reduce crop yields one on top of the other.
Each farmer runs his own finances and some are more savvy and financially able to weather the financial implications of cost rises better than others.
Another problem here is when a farm price is contracted in advance for a yearly crop, the buyer knows what they need to pay, and the squeeze is on the farmer to produce and make an income even though his prices increase in that time beyond his forcasts.
Dairy farmers get an opening seasonal price from the factory, but if their electricity jumps 45% they don’t get to pass that on, they absorb it. Go big or go broke has really become the way due to the way our system is set up here.
The supermarkets are mercenary here. Farmers throw to rot fruit and veg that don’t meet size, shape and color requirements of the supermarket buyers.
Our Blackrock affiliated supermarkets also want to ensure they sell what they buy and continue making hideous profits, so want to keep prices low enough for consumers to buy. Even where they do raise prices, it goes to them not the farmers.
We have cucumbers, tomatoes and peppers grown under gas fueled greenhouses somewhat near me. If their pricing increases beyond their contracted selling prices it could send them to the wall. They can’t increase their yields, only their sale costs if they can. Australia had good labour rates and (reasonably) good protections for workers. Food doesn’t pick itself from the greenhouses and if consumer costs increase but low end wages do not, people will prefer job loss and Government benefits to physical labour jobs they can’t buy groceries with. Unemployment here comes with added bonuses that low wage jobs don’t. Concessions on bills and car regos, school kids bonuses and so on. Low wage work is for fools like me!
It’s a complex system.
And it’s fragile and punitive toward those who feed us.
The abundance we have is quite underpinned by diesel and fertiliser here in Aus.
I do my best to buy from a small local market held monthly. I can get veg, bread, chicken, beef, cheese, seedling and plants directly from those who make and grow them. Expensive but worth it.