Rising diesel prices pose a growing problem for farmers
The cost of diesel used on Irish farms rose by about 33% in the past year.
In the UK, the price of the red diesel used on farms soared 54%, from 22p/litre at the beginning of the year to 34.5p/litre now.
But fuel worries could intensify for farmers, if warnings of a major European shortfall of diesel supplies within 10 years materialise.
UK oil consultant Wood Mackenzie has said huge investment is required in refineries to prevent a scarcity of the fuel on which farmers depend so heavily.
Shortage of the fuel is expected to intensify as governments encourage more diesel use fuel as an alternative to petrol, leaving a European deficit of as much as 50 million tonnes a year by 2015, or 20% of consumer demand Shortage stems from decision taken by many European refineries in the early 1980s to invest in petrol production rather than diesel.
Things could get worse from 2010, when off-road vehicles which now use gas oil will have to be converted to higher quality diesel.
Supplies from Russia and the Middle East may not be sufficient, with the Asia-Pacific area and the US also predicted to be in diesel deficit.
With Western Europe’s diesel consumption set to rise from 200 million tons now to 280 million tons in 2015, expensive upgrading of refineries in Europe, the Middle East and Russia is needed.
However, the silver lining for farmers could be fast growing demand for the crops to make biodiesel, which addresses environmental concerns and enhances engine performance, as well as replacing shortfall.
