MAPLESVILLE, Ala. (WIAT) – Record high diesel prices are likely to impact the cost of goods and services across central Alabama, especially at the grocery store.

The average price per gallon was well above $5 per gallon Wednesday.

Price hikes have already impacted business at Parnell Farms in Maplesville, where the family uses diesel fuel to haul cattle and timber.

“We were running anywhere between $28,000 to $32,000 a week one year ago in fuel and now we are up to close to $60,000 per week,” said Joseph Parnell.

Parnell said he paid about $2.80 per gallon in January 2020 and now he’s spending more on diesel than ever before. He said the cost of transportation will be felt by consumers.

“Transportation is generally 30 to 40 percent of the pricing component of a delivered product and so when transportation goes up 40 percent, it is going to impact that finished good price,” said Parnell.

During good weather, Parnell estimates they cut and transport 100 loads of raw wood products each week, including pulp wood and logs for dimensional lumber that you see in home improvement stores.

“We supply the trees to the mills, the paper mills that would make, in our area carboard boxes, and white copy paper,” said Parnell.

In addition to the effect on the logging industry, Parnell said rising prices are also impacting cattle. Parnell Farms sends cows to the Midwest to a feed lot. The animals are eventually sold to a packing plant and later a distribution facility.

“During the life cycle of that beef cow, that cow is transported at least 5 times and at least 4 of those are by an 18-wheeler,” said Parnell.

Added transportation costs have already raised prices at the grocery store. Parnell doesn’t see a simple solution, but is concerned the move to renewable energy has happened to fast. He’d like to see a 50 year goal to get to renewable energy to remove constraints on production.

In the meantime, prices will continue to rise to keep up with costs.

“The tractors consume the same amount of fuel today that they did a year ago and it costs twice as much to buy it. The trucks consume the same amount they did a year ago, and again it costs twice as much,” said Parnell.

Some have blamed Alabama’s gas tax for price hikes, but Parnell thinks it’s the supply of fossil fuels that is causing the greatest impact.

“As bad as I hate gas tax, I understand the need for it but with the renewables coming online and the electric cars, I am fearful that gas tax is going to continue to get higher and higher as a way to supplement those vehicles that are not paying,” said Parnell.

 According to AAA, the average price of a gallon of diesel fuel Wednesday was $5.20.