While Thunder Bay-area farmers have been trying to salvage a harvest following an unusually dry summer, one thing has begun to feel normal: the rising cost of diesel fuel for their combines, tractors and heavy trucks.
“It is what it is,” Jason Reid, who operates a beef farm on the edge of the city, said on Wednesday.
With a reliance on diesel fuel for heavy machinery, “agriculture is no different from any other major industry, just like forestry and mining,” Reid added.
Reid said he can’t remember exactly when diesel prices started going through the roof. He said it feels the price hike harkens as far back as 2022, when the Russia-Ukraine conflict escalated into full-scale war, rupturing global fuel supply chains.
Across Ontario, prices for diesel fuel have been hovering of late around $2.50 per litre — about 50 cents more than what motorists have been paying at the pump for regular unleaded gasoline.
Reid said he remembers when diesel was routinely about 25 cents cheaper than regular gas.
Farmers get a bit of break on taxes if they use so-called “coloured” diesel in vehicles that are only used for farming operations.
“It’s different from the clear diesel you put in your pickup truck,” Reid noted.
Meanwhile on Wednesday, the federal Liberal government voted against a Conservative proposal calling for, among other measures, the elimination of federal taxes on diesel fuel until next July.
“From a brief look, this plan would be helpful,” said Oliver Paipoonge dairy farmer Bernie Kamphof. “Anything that would potentially lower the cost of diesel fuel would be welcome to us working in agriculture.”
In the U.S., some farmers were irate at President Donald Trump last month when diesel prices in that country hit nearly US$7 per gallon.
Since farming is a business and not just a lifestyle, the price hikes “really cut into your margins,” Reid said.
According to a Conservative party news release, Canadians pay “roughly 26 cents more per litre for diesel than Americans, and 23 cents more than the world average.”
It added: “Canadian diesel prices are now roughly 70 per cent higher than they were one year ago. These costs are passed to the grocery store and kitchen table.”
Reid said consumers will continue to have to contend with higher grocery prices if major input costs, like diesel fuel, don’t stop climbing.
“The hard reality is that food is no longer going to be a small part of Canadian household budgets,” Reid said.
