Find articles

The Trump administration’s $8 billion relief program for farmers is throwing a lifeline to the industry, but producers are still facing lower margins due to high diesel prices amid the Iran war — and experts say the move might only buy time for solving deeper challenges. Through the initiative announced earlier this week, farmers will...

The quickest and most affordable response to historically high diesel prices is also the simplest: Use less of it. Why it matters: Diesel is so entrenched in farming, trucking and other industries that even soaring prices aren't enough — at least not yet — to prompt a wholesale shift to alternatives from electric semi trucks to manure-powered tractors. Catch up fast: Diesel prices have climbed to record highs since the U.S. war with Iran began in March, rising faster than gasoline amid global oil supply disruptions . Diesel averaged $6.31 a gallon Thursday, up 74% from a year ago, according to AAA . Regular gasoline averaged $4.27, up 39%. The big picture: Gasoline gets the attention, but diesel is the workhorse of the American economy. It powers grocery trucks, tractors, freight trains, construction equipment, hospital backup generators and even school buses . Driving the news: The price spike is hitting farmers during the fall harvest. "Farmers buy diesel by the truckload, so we're talking about hundreds of thousands of dollars in diesel, and when it goes up the way it has spiked, that's the difference between profit and loss in a year," said Curt Blades, senior vice president at the Association of Equipment Manufacturers, a trade group representing tractor makers and other heavy-equipment manufacturers. The financial pain varies: Trucking companies can often pass higher fuel costs to customers through surcharges. Farmers, who have little control over crop prices, generally can't. The economic pressure has become political ahead of the midterm elections. President Trump announced $8 billion in one-time aid for farmers at a campaign rally in Kansas on Monday, where Republicans face a competitive Senate race. "It's a bit too soon to tell the impact," Blades said of the aid package, though he welcomed support during harvest. State of play: Trucking and agricultural equipment experts say the most immediate savings come from using existing diesel engines more efficiently. Truckers can slow down and reduce idling. Farmers are increasingly using GPS-guided tractors to avoid covering the same ground twice, a practice known as precision agriculture. Biodiesel and renewable diesel can reduce petroleum dependence without replacing existing engines, but government blending requirements — rather than high diesel prices alone — are driving growth, according to Clean Fuels Alliance America, an industry trade group. Zoom in: Batteries that power truck drivers' sleeping quarters without idling the engine are gaining traction. Nevada-based Dragonfly Energy sells systems that recharge through the truck's diesel-powered engine while driving, then power air conditioning and other appliances while parked. The company projected a 160% increase in third-quarter trucking revenue, a bright spot amid otherwise sluggish financial performance. Texas-based Stevens Transport says 400 of its trucks use Dragonfly's batteries, cutting diesel consumption by about 4% compared with trucks using smaller diesel engines to power their sleeping quarters. The approach illustrates a fundamental tension in energy transitions: Does technology incrementally change an industry or revolutionize it? "We haven't even mastered leaving the truck off when it's not moving, let alone moving it with electricity," said Wade Seaburg, Dragonfly's chief commercial officer. "Let's master the little things first, and that's been a well-received message." "Think evolutionary rather than revolutionary," said Mike Roeth, executive director of the North American Council for Freight Efficiency, a nonprofit researching fuel-saving trucking technologies. Zoom out: The same logic applies across diesel-dependent industries. Expensive equipment lasts for years, and switching fuels often requires new infrastructure and vehicles. "The fact diesel fuel prices are higher matters in the calculations, but it doesn't make the challenges of these alternatives any easier," Roeth said. Yes, but: More dramatic changes are still percolating, particularly in electric trucking . Forum Mobility, which builds shared charging depots and leases electric trucks, says electric trucks have a roughly 40% fueling cost advantage over diesel in California, where diesel prices have topped $8 a gallon. The company has commitments from 25 carriers for 330 Tesla Semis and is building four additional charging depots in California. Meanwhile, on the farm, equipment maker New Holland has spent more than a decade bringing methane-powered tractors to market, including ones that can run on fuel made from livestock manure, after abandoning an expensive hydrogen tractor project. "The increase in diesel prices has generated a little more interest," said Sean Dorosz, a product marketing manager at New Holland. But "I don't think it's going to be the one thing that makes them write a check to buy a methane tractor." Access to manure-derived fuel and state incentives also shape the economics. The bottom line: High diesel prices are strengthening the case for alternatives. Making them practical is a much slower process.