Source: Radio New Zealand
JTC Viticulture machinery in operation. Supplied
The rural sector says it is being challenged by soaring diesel prices, the likes of which one operator says it has never seen before.
JTC Viticulture in Marlborough is partway through a busy grape harvest, with 14 harvesting machines and 28 tractors running 24 hours a day.
“We have about 90 people to run that operation,” managing director Jason Tripe said. “Our diesel price has increased sort of 90 percent over the last two-and-a-half weeks, pretty much.”
Tripe said the company was used to fluctuating fuel prices, but nothing like this.
“Fuel is a large part of our cost, and the biggest challenge about this has been the short nature, it’s happened so quickly.
“And we’ve quoted or priced work based on a known number and fuel has been part of that, we’ve been seriously impacted by that because of the speed it’s gone up.”
Tripe said the immediate impact had been “incredible”.
JTC Viticulture machinery in operation. Supplied
“So it’s been pretty difficult to manage that, our clients have been very open to discussions about it but they’re under pressure as well because our industry is facing a few headwinds at the moment and our returns are down, so this is just another hit to us basically.”
He said clients were being asked to consider paying more, but it was a double-edged sword given the challenges they were facing themselves.
“But our clients for the main part have been understanding, and we’ve sort of soaked up what we can and we’ve sort of met in the middle.”
Asked if he had seen anything like the surge in diesel pricing before, Tripe said “nothing even comes close” in the time the company had been operating.
“It’s staggering, really.”
Tripe said every load of diesel being delivered was a different price and going up several times a week.
The sooner harvesting was complete the better, he said, and added his supplier had already said diesel supplies were getting tight.
“We’re dealing with the increased costs, but in the background is concern about supply. We’re using large volumes daily, and if we can’t get that fuel delivered then machines will come to a halt.
“We’re just hoping we get the harvest completed before things really start to bite from a supply issue, not to mention the cost.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
