Source: Radio New Zealand
Nicola Willis speaks after the latest government update on fuel supplies, 6 April. RNZ / Giles Dexter
The finance minister says the country’s fuel supplies are stable, but diesel levels have dipped slightly since the last report.
While New Zealand’s jet fuel and petrol levels have risen slightly, diesel went down from 52.2 days to 51.5 in reserve. As of last Wednesday, 17.5 days’ worth of the diesel was on New Zealand shores, with the rest aboard ships en route.
The Ministry of Business, Innovation and Employment (MBIE)’s latest data showed national fuel stocks were stable, with sufficient stock levels – for now.
Finance Minister Nicola Willis will speak to Morning Report shortly after 7.15am – listen live here.
‘Crunch’ on the way if war not resolved
Soaring diesel prices are forcing some farmers to change what they grow and how they grow it. Some are shifting to crops that use less fuel and have started cutting back on fertiliser, moves that could ultimately lower production and increase prices.
Federated Farmers arable chair David Birkett told Morning Report on Tuesday farmers were adjusting to the new reality for now, but if the war was not over and usual deliveries resumed by the end of the southern hemisphere winter, there would be a “crunch”.
“Initially supply was a big issue and we are still hearing isolated cases where farmers are running out, but in general the supplies are getting through, but they are certainly being delivered in smaller batches.
“The concern now, I guess, as a lot of farmers stored fuel on the farm, that storage has now been used and the full price impact is coming through now. So we’ll start to have an economic impact from now on.”
Farmers were considering switching to crops that use less fertiliser, he said, and using smaller tractors.
“The thing is here, I guess for farmers, is looking at what can they do to make sure that profitability doesn’t drop away. And that’ll be one of the two questions. One, does it reduce the amount of fuel that’s needed? And two, will it impact on the profitability at the end of the day as well?
“Because while some sectors are going well, other sectors are struggling with their profitability at the moment. Price and supply are obviously an issue… At what point do those stock levels become a real operational risk for what you can produce?”
David Birkett. RNZ/Anisha Satya
Birkett said the timing of the shock was “very lucky”, with much of our crops already planted and the quiet winter period ahead.
“Our next peak demand will be springtime. And that’s probably our next area of concern is, what will the price be like come springtime? So we’re talking August. And what will the price be as well? … The next crunch period will be spring, and I would certainly hope that the war is finished by then. But yeah, no, I don’t think anyone’s holding their breath.”
The price of fertiliser in spring remained a big source of uncertainty.
“We know that the Australian prices of fertiliser have already gone up significantly, so that gives us a bit of an idea of where those fertiliser prices will probably get to. So yeah, both fuel and for us here in New Zealand are pretty linked, and they’re the two which we’re keeping a very close eye on.”
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
