Manitoba farmers are divided over the prospect of purchasing fuel through a single buyer.
All Things Energy is an Edmonton-based company that sets up fuel-buying groups to get lower prices.
The company brought the proposal to the annual meeting of Manitoba’s largest farm lobby group, Keystone Agricultural Producers, in January.
Charles Fossay, a Starbuck farmer and KAP district director, said producers seem to be evenly split on their reactions to the proposal.
“Some are worried about loss of competition and how it could affect their local community,” Fossay said. “Fuel is a large percentage of business for a local co-op,” Fossay said. “If you lose that, you could lose the whole thing.”
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Producers in more populated areas such as the Red River Valley and communities near Winnipeg like the idea, Fossay said. Lack of competition there isn’t a problem.
But farmers in northern and western Manitoba aren’t convinced. If one company supplies the majority of farmers, competitors could be driven out of business.
There is also some skepticism about the three to four percent savings being touted by the company.
Manitoba municipalities that buy fuel through All Things Energy said the savings are closer to one or two percent.
Fossay said the amount of savings depend on how many farmers sign up. If 7,000 producers contract 30,000 litres of fuel a year, “that’s large volumes and big savings,” he said.
Under the proposed arrangement, All Things Energy negotiates a price with the refineries, and then local dealers supply the fuel.
Fuel-buying groups, such as the ones the company set up for some municipalities and school divisions in Manitoba, receive their invoices and pay bills as one entity.
If KAP signs on, invoices from the oil company supplying the fuel would go to All Things Energy’s Alberta office to analyze the data and correct any errors. Members would then pay KAP, who would write a single cheque to the oil company.
