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Michigan shippers search for ways to cut costs

(November 21, 2011 - The Packer)—With diesel fuel prices hovering near $4 a gallon, distributors are finding it hard to ignore the pinch.

The national average price of diesel fuel was $3.915 on Nov. 9, according to AAA. The average price was even higher, at $3.996, in Michigan.

"We’re all touched by the freight issue,” said Michael Badalament, salesman for Detroit-based R.A.M. Produce Distributors, which ships product to customers in Michigan, Indiana, Ohio and Canada.

Ron Stewart, president and owner of Detroit-based Simon & Leeman Corp., said his company is running two of its 12 trucks on biodiesel, which typically costs about four cents a gallon less than diesel.

“We track everything, and use our most efficient trucks on our longest routes,” said Stewart, whose company uses about 2,000 gallons of fuel each week.

Stewart isn’t necessarily stopping at alternative fuels. He’s considering switching his medium-duty trucks from diesel to gasoline, which was nearly 50 cents a gallon less than diesel in the AAA’s Nov. 9 report. Gas engines, he said, have fewer emissions and last longer than diesel engines.

Read more on The Packer's website: http://www.thepacker.com/fruit-vegetable-news/know-your-market/Michigan-shippers-search-for-ways-to-cut-costs-134120413.html?ref=413

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