A national milk haulage company says an extra two weeks’ supply of AdBlue from Indonesia won’t solve “price gouging” being experienced in Australia for the scarce diesel fuel additive.
- A milk haulage company says it is paying four times more for AdBlue
- The urea-based additive helps reduce emissions from diesel vehicles
- Australia is in talks with Middle Eastern nations to shore up supply
A federal government taskforce into the critical shortage of AdBlue has struck a deal with Indonesia, after warnings from the transport sector that Australia’s supply could grind to a halt.
Federal Trade Minister Dan Tehan said Indonesia’s input could stretch Australia’s supply to February, while talks are ongoing with other Middle Eastern trade partners.
A global shortage of urea — a key ingredient in AdBlue, an important chemical used to remove pollution from the exhaust of diesel trucks — has caused China to cap its exports to protect its own supplies, fuelling AdBlue prices.
Chief financial officer of SRH Milk Haulage, Ben Nix said prices had quadrupled in the past fortnight and stockpiles at the company’s WA, Victorian and NSW depots — which would usually carry about 9,000 litres — are near empty.
“We’re down to effectively zero at each depot and we’ve just got to send our trucks to service stations to get it,” Mr Nix said.
“It’s very costly.
“That’s just the cost of the product, let alone the time to send the drivers to the service.”
Mr Nix said the company, which runs 65 trucks across the country, used more than 300,000L of AdBlue a year.
Mr Nix said he had found suppliers who could offer $1.80/L in about six to seven weeks.
“But obviously that’s concessional to us based on the number of litres we use a year,” he said.
Mr Nix assured farmers, processors and consumers that they “will always find a way to keep milk flowing”.
“It doesn’t matter if it’s bushfires, floods, droughts, COVID or a shortage of AdBlue.”
ACCC ‘liaising’ with government
Mr Nix would like to see the competition watchdog investigate the prices to ensure supply and freight businesses can stay on the road.
“It’s something the ACCC should become involved in if there’s such a shortage. There’s just price gauging that appears to be happening,” he said.
The ACCC told the ABC it is speaking with the federal government “about whether an authorisation is needed to allow diesel exhaust fluid producers to share information”.
“If an application for authorisation is lodged it will consider it at that time,” a spokesperson said.
Mr Tehan said Australia was also in talks with many trading partners “from Saudi Arabia, to the United Arab Emirates, Qatar and also Japan”.