A huge fuel tank greets you at the top of the driveway of John Austin\u2019s Te Awamutu contracting company.<\/p>\n
It holds 40,000 litres of diesel, and in peak season, can get re-filled nearly every day.<\/p>\n
When last Sunday\u2019s delivery rolled in, Austin said the bill made for tough reading, an extra 50.9 cents on every litre.<\/p>\n
\u201cI actually heard from one of our customers that fuel was going up, I didn\u2019t even realise or know. <\/p>\n
\u201cWe were down, it was on a weekend, so our next shipment … for every 10,000 litres was another $5000.\u201d<\/p>\n
The busy time of year means Austin\u2019s company does work for up to 50 farmers a day, operating combine and forage harvesters, tractors and trucks to help with their harvests.<\/p>\n
John Austin’s Te Awamutu contracting company. Photo \/ RNZ, Evie Richardson<\/p>\n
\u201cIt\u2019s huge, one of our forage harvesters would use well over 1000 litres a day, probably 1500 litres.\u201d<\/p>\n
With weeks of the peak harvest still to come, Austin has had to think fast about how they\u2019re going to cope with the massive price spike.<\/p>\n
But with so much uncertainty, it is impossible to know how things will pan out.<\/p>\n
\u201cIt\u2019s very hard for the business to be fair to the customers and work with the customers when you\u2019ve got such a huge input to the business like fuel when there\u2019s uncertainty around supply and price.\u201d<\/p>\n
While some of the cost will be absorbed, the company can\u2019t afford to absorb it all, and has put a fuel surcharge on to customers.<\/p>\n
\u201cIt\u2019s impacting them already, it\u2019s costing them extra on their farm when they drive their tractors, when they drive to town, it\u2019s costing them extra, and there\u2019ll be lots of different ways our customers are impacted. <\/p>\n
\u201cIt\u2019s just not good for NZ, it\u2019s not good for the world, it\u2019s not ideal.\u201d<\/p>\n
Gordonton farmer Donald Stobie. Photo \/ RNZ, Evie Richardson<\/p>\n
An hour north, at his Gordonton farm, Donald Stobie is preparing to harvest 200 hectares of maize and grain.<\/p>\n
It\u2019s a busy time of year, with all his machinery burning around 3000 litres of fuel a week, which he reckons is costing him an extra $1000.<\/p>\n
But unlike contractors, he has no immediate way to offset the cost, and it is being absorbed by the business.<\/p>\n
\u201cThe crop prices are set in the springtime at planting time, and then the crops grow for six or seven months before you harvest, there\u2019s like two-thirds of a year there where if things change, you can\u2019t do anything about it.\u201d<\/p>\n
Like many farmers, he is also worried about the cost of fertiliser shooting up, with the Middle East a critical supplier.<\/p>\n
He has started stockpiling for the planting season later in the year, in the hopes of mitigating some of the price spikes.<\/p>\n
Alongside fuel, he is concerned about what impact these costs will have on his business if this continues for some time.<\/p>\n
\u201cIt\u2019ll certainly chew away at our bottom line, and I guess that\u2019ll mean we won\u2019t have money for our repairs or maintenance or any capital projects we wanted to do. <\/p>\n
\u201cIt\u2019s not just fuel, there\u2019ll be all sorts of other price increases affecting us too from all our suppliers at that, so there\u2019ll be cost increases across the board.\u201d<\/p>\n
Business manager at contracting company, Gavins, Chris Paterson. Photo \/ RNZ, Evie Richardson<\/p>\n
Down the road, the price spike has contracting company Gavins considering its options.<\/p>\n
Business manager Chris Paterson said they have been forking out an extra $60,000 a week since prices went up.<\/p>\n
While they don\u2019t want to pass costs on to their customers, most of whom are farmers, they may be left with no other choice.<\/p>\n
\u201cA likely outcome as it stands today would be for us to suck it up a bit and some of our charge-out rates to go up a bit.\u201d<\/p>\n
Paterson said they are waiting to see how prices evolve over the next week or so before making any decisions, but the price rises are impossible to ignore.<\/p>\n
\u201cIt is creating a dent today … there\u2019s a real impact immediately, we\u2019re burning fuel each day, the impact is immediate, but the size or scale of it will evolve over time.\u201d<\/p>\n
– RNZ<\/p>\n","protected":false},"excerpt":{"rendered":"A huge fuel tank greets you at the top of the driveway of John Austin\u2019s Te Awamutu contracting…\n","protected":false},"author":2,"featured_media":333788,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[806,138,802,24364,12967,2678,8594,4508,16609,111,139,69,3333,24365,6926,13744,1515,1524,6149],"class_list":["post-333787","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-as","tag-business","tag-costs","tag-evie","tag-farmers","tag-fuel","tag-harvest","tag-hits","tag-iran","tag-new-zealand","tag-newzealand","tag-nz","tag-price","tag-richardson","tag-season","tag-shock","tag-surge","tag-waikato","tag-war"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/333787","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=333787"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/333787\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/333788"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=333787"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=333787"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=333787"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}