Diesel price recovery won’t affect grain growers ahead of season

Diesel prices may have lifted from the lows reached last year, but grain growers aren’t expected to be hit hard by costs as sowing programs ramp up.

On the Move: For March this year, the average Melbourne diesel price was $1.20 a litre. Picture: Chloe Smith

WHILE   diesel  prices  have made a recovery from their falls in the midst of the coronavirus pandemic last year, grain growers aren’t likely to be set back significantly as sowing ramps up this season.

For March this year, the average Melbourne diesel price was $1.20 a litre, in comparison to the average in March 2020 of $1.13 a litre.

But it is still significantly lower than the March 2019 average of $1.35 a litre, according to Thomas Elder Market’s Andrew Whitelaw.

“It won’t be a huge issue for grain growers, it is slightly higher than this time last year but we have come off a good year and we have all the potential there for a good year this year,” Mr Whitelaw said.

online artwork april 21 diesel prices

“It is still relatively cheap compared to that last period for growers to fill up.”

For east coast growers, Mr Whitelaw said a lift in diesel prices won’t “make a huge difference” to grain grower’s profitability, in particular for NSW growers who are set up for a bumper year.

“The thing at the moment is — if we look from a national point of view — especially from the east coast, then diesel is a bit more expensive but the ground is still quite moist in areas,” he said.

Mr Whitelaw said the price lift was due to the recovery of the global economy over the past six months.

“Demand for energy has increased and so what we are finding is that demand, effectively when the economy is doing well, things like crude oil increase in value,” he said. “That increase in the crude oil price flows directly through to our price for fuel.

“It is one of these things where our price of diesel is driven by what happens overseas. As the world recovers from coronavirus, there’s more planes in the air and boats in the sea and cars on the road so that will mean that energy demand does up and the price goes up.”

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