Now is the time to make sure your gas tanks are full and ready for planting season.
A CHS executive predicts a surge in prices this spring. Demand for gas and diesel bottomed out during the pandemic. There is optimism now, with the vaccine rollout, but corn prices and new environmental regulations will all factor into the equation.
Refiners are running at reduced capacity, but if demand picks up at spring planting, supply could be a problem in the coming months.
The executive predicts $3 dollar diesel by summer and $2.75 for gas.
Those prices do not take into account the potential for a hike in the federal gas tax.
It is a situation that the ag sector will be watching with changes in federal transportation policies. Washington state is already ahead of the game with legislation on the table that would increase the state tax to the highest in the nation.
The bill seeks a 10 cent hike to the state tax, making it 67 cents a gallon, but it would jump another 8 cents next year. That would cause a big increase in operating costs for farmers who factor fuel into their budgets, but a Washington state lawmaker says there is a bigger issue for farmers.
According to Senator Mark Schoesler, “Agriculture has grudgingly accepted some gas tax increases, this one is the biggest ever, combined with 28 separate fees, many of which our friends and neighbors will be paying, and for the first time adds a carbon tax. There aren’t going to be improvements to be seen in rural Washington, they are going to be urban improvements and we get the bill.”
Supporters of the bill say that it would pay to convert diesel ferries to electric and redesign hundreds of salmon culverts under a federal order by 2030.
