Federation Investigates Rural Fuel Rip-Offs

10 November 2000 PR121/2000

FEDERATION INVESTIGATES RURAL FUEL RIP-OFFS

Federated Farmers is asking its members to check if fuel retailers are overcharging them following massive fuel price rises and falls. The federation is investigating via its members if fuel retailers are using the volatility of fuel prices to rip off the rural sector.

The federation is seeking further details to confirm if it is a widespread problem, following cases brought to its attention by members.

"Competition for customers is driving diesel prices down in Auckland. If retailers margins are widening, then the federation will be encouraging members to shop around, and use similar levels of competition to reduce on-farm fuel costs," said Neil Barton.

One Federated Farmers member cited his farm delivered, bulk petrol price that he thought was reasonable until he realised that GST was additional. The 119c/litre price compared well with the 123.4c/litre pump price in his local town, 20 minutes away, until GST increased the price to 134c/litre.

The farmer immediately shopped around and secured an immediate 6c/litre reduction from an alternative supplier. However, this price drop only reduced the extra margin over the pump price from 10.5 to 4.5c/litre.

Similar stories come from users of independent garages in small towns, who have told the federation that every time the price of fuel falls, it drops less for them compared with the larger towns and cities.

Mr Barton acknowledged that the price of diesel had dropped by 3¢ in Auckland.

Federated Farmers is calling on its members to have a very close look at the real price they are paying for fuel, to and shop around for the best price.

The federation would also like members to contact Policy Manager Gavin Forrest on 0800 327 646 if they have evidence of fuel retailers increasing their margins over the recent period of price volatility.

ENDS For further information: Neil Barton 021-441-125 Gavin Forrest 025-491-323

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