Fuel demand to rise as harvest begins

Boom harvest will pressure fuel suppliers to meet demand, but Caltex says it’s ready despite concerns from Victorian Farmers Federation

By Ruza Zivkusic | October 18, 2010

Truck drivers’ fuel tanks will not run dry as they prepare to deliver what is expected to be a bumper harvest.

Drivers will not be hit by a diesel fuel shortage despite the Victorian Farmers Federation (VFF) warning they will need triple the amount of fuel to meet demand.

Caltex Australia spokesman Sam Collyer says he is aware of the increased demand for fuel at harvest time but believes diesel supply will meet forecast demand.

"Such a large volume of grain brings with it challenges for everyone in the supply chain, especially on the back of several of years of below-average production," Collyer says.

"As the transport and logistics industry rapidly ramps up its efforts to handle the increased volume, so too does Caltex prepare for and monitor its supply of diesel and other products."

Collyer says Caltex keeps in regular contact with customers and undertakes demand forecasts based on information from clients.

He says freight contractors are on standby for peak times to ensure continuity of supply.

Diesel prices have been stable for some time and temporary spikes in demand from agriculture do not tend to have an impact on the prices, Collyer says.

"Transport on agriculture products makes up only a fraction of Australia’s diesel demand and therefore does not have a material impact on prices," he says.

VFF Vice-President Peter Tuohey says he was told there might not be enough of diesel fuel for farmers.

"My understanding is that the suppliers are working on a normal year’s capacity but it’s such a big harvest so there will be more than three times use by farmers," he says.

"People have been coming to us saying their supplier have said they won’t have enough of diesel."

Tuohey believes a fuel shortage will delay harvesting, causing anger to farmers.

Tuohey uses up to 1200 litres of diesel fuel a day during harvest time on his farm in Echuca.

Belford Petroleum’s General Manager Alan Smith says his suppliers have not advised him of possible diesel fuel shortages.

"We’re only a distributer but from what I understand there’s no word that there’s going to be any shortages," Smith says.

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