Chamber Chat: Rising Cost of Diesel

SALISBURY, Md. – In this week’s Chamber Chat, WMDT’s John Trout and Salisbury Area Chamber of Commerce President Bill Chambers discuss how the rising cost of diesel is impacting farmers and residents alike on the Eastern Shore.

The United States is currently experiencing record level costs for diesel, prompting higher material delivery costs. 

“In the past, these expenses were diesel costs on to the end user, that’s all to be expected,” Bill said. “We’re looking at diesel prices now that nationally are 80 percent over where they were, just what, maybe six months ago.”

Bill says some of the inflation can be attributed to what’s happening in the Middle East, but some of the increased cost is due to supply and demand. Plus, with a robust economy, Bill added that it creates a perfect storm.

“But if diesel prices stay where they are, independent truckers, small fleet companies who typically absorb these pump prices are going to face mounting debt. And frankly, they’re going to start parking their vehicles potentially while the margins were already thin,” Bill said. “For local independent truckers with things like tire prices, insurance — you add this on top and there’s not a lot of profitability there.”

As a result, some companies, particularly small businesses, are starting to feel the pinch. A higher cost of delivery is often passed onto the cost of the good delivered; including groceries, automobiles, home building, winter heating costs, and more.

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