The problems with the supply of diesel inland are getting worse, and the agricultural organization Agri SA is urging the government to investigate urgently.
Diesel now has to be transported by coastal trucks, which raises costs, and farmers who are currently harvesting maize, citrus and other crops are seriously disadvantaged, warned Christo van der Rheede, deputy executive director of Agri SA.
Kevin Mileham, DA MP and DA spokeswoman for energy, says he has called for an urgent national debate on the crisis after the Department of Mineral Resources and Energy dismissed diesel shortages as a short-term logistical problem rather than a serious crisis.
Oil companies such as Engen, Shell, BP and Total are rationing the diesel they give to wholesale distributors and some gas stations have already dried up, says one diesel depot in Gauteng that sells diesel to trucks.
Rumors are mounting that fuel companies are deliberately holding back in anticipation of the big price hike on July 1, but the South African Fuel Industry Association (Sapia) has so far ignored inquiries about it. According to Van der Rheede, Agri SA participates in weekly meetings with Sapia, but the situation on the ground seems to be different from the picture that Sapia sketches that there is enough diesel available. He warns there is now a strong demand for white maize meal, and a sustained diesel shortage could adversely affect food security.
The Gauteng diesel depot believes diesel shortages will worsen in the run-up to the price increase. “So we can be without diesel any time this coming weekend and next week,”
The current average under-recovery on diesel is R1,67 per liter, which could increase to more than R1,80 by next week as Wednesday’s under-recovery for the day has already reached R2 per liter. The Department of Mineral Resources and Energy calculates the monthly price adjustments based on the previous month’s over or under recoveries on diesel prices.
The Gauteng diesel depot says Sasol is not currently supplying diesel because its storage tanks are full of aircraft fuel. “We are currently doing everything we can to find diesel, but like other wholesalers, we find it very difficult to obtain any diesel, regardless of the price.”
Ricky Klitzke of Quest Petroleum in Gauteng says they are also struggling to help all their customers and are getting calls from other dealers asking for diesel supplies on a daily basis.
Klitzke says the last update he received from the fuel industry was on May 20, warning of expected diesel shortages due to refineries that are not yet back in full production following the Covid 19 restriction.
Mack van der Merwe, MD of Mack’s Petroleum, a major diesel distributor for the agricultural industry in the North West, the Free State and the Northern Cape, says they receive limited stock and distribute it among their depots. According to Van der Merwe, Transnet’s pipeline is not yet fully operational, contributing to the problem.
Cobus van Zyl of the agricultural organization Agri Noordwes says it currently appears to depend on which supplier a farmer uses. Some farmers readily get diesel supplies, but others struggle.
Especially miners who mined coil diamonds in the North West and agricultural cooperatives struggle to get supplies.
It’s now time for corn to harvest, and if farmers can’t get their crops, it’s going to affect their cash flow, Van Zyl warned.