President Trump signed an executive order on October 5 temporarily allowing red-dyed diesel fuel — normally restricted to off-road agricultural use — to be used in highway vehicles through December 31, 2026. The order directs the U.S. Treasury to defer the 24.4-cent-per-gallon federal diesel excise tax on qualifying dyed fuel used on highways, providing roughly $24 in federal tax relief per 100-gallon fill-up. The administration is also exploring options to permanently forgive the deferred taxes.
The move comes as diesel prices have risen sharply due to global supply disruptions and international conflicts. Western Growers, along with other agricultural groups, sent letters to the Governors of California, Arizona, and New Mexico urging them to issue similar state-level executive orders to extend the benefit to intrastate agricultural transport.
For produce logistics teams and growers managing harvest-to-market transportation costs, this is a near-term cost relief measure. The size of the benefit depends on whether state governors follow with compatible orders — watch California in particular, given its volume of produce moving to market by road.