Farmers say fuel price cuts not enough as green diesel costs surge across Ireland
Farming organisations have said fuel measures implemented by the Government are not enough for rural Ireland.
Farming organisations have welcomed the Government's fuel measures — however, they say it is not enough for agricultural and rural communities.
The Government has passed measures to lower petrol by 15c/l and diesel by 20c/l until the end of May. Green diesel will also be reduced by 3c/l, and the Nora levy will be reduced from 2c/l to zero next week once it is passed.
IFA president Francie Gorman said the cuts to agri diesel in the fuel package are derisory and will have little or no impact at the farm level.
“We estimate the proposed cut will reduce green diesel prices by about 3%, while the price of green diesel has increased by 50% over the past three weeks. This will do little or nothing to help farmers and agri contractors deal with the escalating cost of fuel,” he said.
Carbon tax makes up 17c of the 22c tax on agri diesel. In the last two years, the carbon tax has increased by almost five cents per litre. It’s due to go up by 2.3c on May 1.
“This is a classic example of the Government giving with one hand while taking with another,” he said.
Mr Gorman highlighted that agri contractors play an important role, providing year-round services to farmers, and they are fully exposed to the carbon tax on agri diesel. He added the carbon tax could not achieve its aim of encouraging substitution to non-carbon fuel sources, as there are no alternatives available for agricultural vehicles.
“The reality is that food prices will have to increase to cover these extra costs. Last week, we saw a significant horticulture producer go out of business. Food prices will have to go up to cover these cost increases,” he said.
Macra has acknowledged the Government’s decision to reduce excise duty on petrol and diesel, but has warned the measures do not go far enough to address the scale of rising fuel costs facing young people in rural Ireland.
Macra president Josephine O’Neill said: "While we welcome the announcement of these measures, we do so with disappointment and frustration. While our young people and young farmers grapple with significant cost increases, the Government has been too slow to provide meaningful support.
"While these reductions will provide some benefit, it is also disappointing that young farmers and agricultural contractors are excluded from the diesel rebate scheme."
The organisation highlighted that farm machinery relies heavily on fuel, representing a high and unavoidable cost, as the busy tillage season begins and silage season looms. Rising fuel prices are therefore having a direct impact on both daily living and farm operations.
Macra is calling on the Government to revisit current measures to ensure they are adequate and inclusive of those working in agriculture, while also monitoring the situation to provide further support where necessary.
The organisation warned as tillage ramps up and silage season approaches, rising fuel prices are hitting both household budgets and farm operations hard, given machinery’s heavy and unavoidable reliance on fuel.
Macra is calling on the Government to revisit current measures and also monitor the situation to provide further support where necessary.
ICMSA president Denis Drennan described the cut in fuel prices as “wholly inadequate” and did not address soaring farm inputs like fuel and fertiliser at the same time as dairy and beef prices were either below the costs-of-production or slumping fast.
Mr Drennan said more radical measures were needed to protect farmers who were entering a "perfect storm" where the “Government seemed unable or unwilling to address inflationary factors”, driving up the costs of producing food while the prices paid to farmers were falling or stagnant.
He also called for an investigation into why green diesel had risen in price at a much faster pace than ordinary diesel, and into how the carbon tax, equivalent to 17c/l on green diesel, can no longer be ignored.
“Farmers need decisive action and meaningful reductions in their costs, and instead we are getting these minor and marginal penny-pinching measures that are the equivalent of throwing a bun at a hungry bear,” he said.
ICSA rural development chair Edmond Phelan says the measures will not protect food production.
“A 3c cut is negligible in the face of fuel cost increases of up to 70%,” he said.
“Farmers are still only getting a small cut that makes little real difference. There is no recognition of the critical role that primary food producers play in maintaining food supply, and a marginal reduction like this will not affect a farmer’s ability to pay bills or continue producing.
“Without real action, farmers will have no choice but to cut back, and that will hit food production and push prices up for everyone.”
Ibec has welcomed the news of emergency measures proposed by the Government, but has cautioned businesses that own and operate their own fleets will not be able to access the new diesel rebate and will continue to face unsustainably high energy costs.
Conor Minogue, Ibec energy policy senior executive, said: "It is really positive to see the Government respond so quickly to the current oil crisis. The emergency measures, like the excise duty relief, the diesel rebate scheme, and increases to the fuel allowances, will provide meaningful relief for many businesses and households.
"However, businesses that own and operate their own freight fleets will be frustrated that they cannot access the new rebate scheme, and a workaround for this needs to be found. These company-owned freight vehicles make up a significant share of the domestic freight fleet.”
