South Australian farmers are experiencing delayed fuel deliveries and growing concerns about availability and price in the lead-up to seeding.
In a survey by Grain Producers SA (GPSA), nearly half of the state’s grain growers expressed significant concerns about diesel supply due to panic buying, with 32 per cent of respondents currently having difficulty securing their diesel requirements.
The results were presented directly to Premier Peter Malinauskas and Treasurer Tom Koutsantonis at this week’s Roundtable on Fuel Security.
GPSA Chief Executive Officer Brad Perry said the survey results highlight the growing pressure on grain producers as they head into one of the most critical operational periods of the year.
“Right now, South Australian grain producers are spraying and preparing for seeding, which is one of the most diesel-intensive periods of the year,” Mr Perry said.
“At the roundtable, the Federal Government reassured industry that Australia holds more than enough diesel reserves to meet current needs and that some diesel has already been released from those reserves to regional areas to ease pressure.
“The message from the Federal Government was that this is primarily a fuel demand issue rather than a national supply shortage, but for farmers the immediate concern is still getting fuel delivered when they need it.”
The survey also highlighted how quickly operations could be affected if supply disruptions continue.
Fertiliser Prices Surge Ahead of Seeding
Six in ten of the 638 South Australian grain producers surveyed said their diesel deliveries had already been delayed, reduced or cancelled as fuel and fertiliser prices surge ahead of seeding.
Mr Perry said GPSA also raised concerns at the roundtable about fertiliser supply and rising prices.
“Cropping budgets are set months in advance, so sudden increases in diesel and fertiliser prices right before seeding can add hundreds of thousands of dollars to a farm’s operating costs almost overnight,” he said.
“With margins already tight following dry conditions and rising interest rates, grain producers are facing a triple whammy of higher diesel prices, higher fertiliser prices and higher finance costs as inflation rises.”
The survey found fertiliser prices have increased significantly compared with last season.
Mr Perry said growers understand global events can affect supply chains but need greater transparency around fertiliser pricing and supply.
“Grain producers need clear information from suppliers about fertiliser supply and pricing so they can plan their cropping programs with confidence,” he said.
“With seeding approaching, grain producers simply need certainty. Farmers need to know diesel will be delivered and fertiliser will be available so they can get crops in the ground and keep food production moving.”
Machinery Stops As Uncertainty Grows
One of the grain growers surveyed said they had already had to stop machinery in order to prioritise fuel for spraying.
“We would normally receive fuel within one to two business days of ordering, but that has been pushed out to a week, with no certainty that we will actually get it delivered.”
The grower said fertiliser prices had risen by up to $400 a tonne, resulting in a $450,000 cost difference for the season.
“Given we don’t get to pass on our costs with the sale of our product, we are once again being squeezed from both ends, not to mention the very real threat of not being able to put a crop in at all this year if we can’t get hold of fuel.”
For South Australian grain producers, the coming weeks will be critical.
