Australian chemicals makers scramble as AdBlue diesel shortage threatens national economy

Thousands of Australian food and commodity trucks could be forcibly stored within months if local manufacturers fail to meet increased demand for AdBlue.

Australian chemical manufacturers capable of producing AdBlue – a urea-based additive used in diesel vehicles to reduce the expulsion of hazardous emissions – are scramble to increase production, because an international shortage threatens to curb local trucking and logistics industries.

Until last month, China exported around 80 percent of the world’s refined urea, but recent market conditions have prompted the country to shift the supply to domestic agriculture (the chemical is widely used in synthetic fertilizers).

Brisbane-based Incitec Pivot currently operates the only local AdBlue plant from raw materials, and this facility currently accounts for around 10% of Australia’s demand for AdBlue.

“We are fully committed to meeting the needs of our domestic customers,” said a spokesperson for the company. Drive.

“Although our ability to increase production is limited due to technical constraints, we are currently studying increasing the capacity of our AdBlue solution and will do everything possible to increase supply over the next few months. “

Drive understands that several other chemical manufacturers are also looking to increase production at different levels of the supply chain to meet demand.

However, if local producers are not able to completely fill the existing deficit – which industry experts predict is very likely – it could have far-reaching implications for the Australian economy and, in the worst case, cases, force thousands of and freight trucks must be stored until the return of supply.

Linfox spokesperson and Toll – two of Australia’s largest logistics companies, which together operate around 8,000 interstate heavy vehicles – declined to comment when asked to comment, however Drive understands that both are contingency planning for supply shortages to worsen.

The Australian Trucking Association and NatRoad are scheduled to meet with Deputy Prime Minister Barnaby Joyce today to discuss possible solutions to the AdBlue shortage, but it’s unclear how – or if – the federal government plans to step in .

Drive has contacted all three parties, and this story will be updated if more information becomes available.

Cam Dumesny is the CEO of the transport industry lobby group Western Roads Federation, and believes Australia is particularly vulnerable to potentially catastrophic supply chain disruptions in AdBlue production.

[If we run trucks without AdBlue] it’s a huge environmental impact and it could damage the vehicles … So what do we do about it? Well the first thing is we need to protect the Brisbane manufacturing plant and scale it up to bring manufacturing offshore, ”Mr. said Dumesny.

“We have to start protecting sovereign risk because without this AdBlue – because that’s what trucks run on – so it’s a bit like without fuel … and that’s a problem.

“The price has gone from $ 350 per thousand liters to $ 1,350 … Buyers are panicking. through panic, which will only make the problem worse.

“The pandemic has highlighted how exposed Australia is in terms of risk… We do the assembly or blending here, but we don’t produce the raw agents… and suddenly we are exposed to chains of ‘entire supply. “

Asked about the duration of the shortage, Mr. Dumesny replied: depends on China, but could affect us for a while. “

This story will be updated when more information becomes available. Stay tuned Drive for all the last ones.

William Davis

William Davis has been writing for Drive since July 2020, covering news and current affairs in the automotive industry. He mainly focused on industry trends, autonomous technology, electric vehicle regulation and local environmental policy. As the latest addition to the Drive team, William was recruited for his attention to detail, writing skills and strong work ethic. Although he has written for a wide range of outlets – including the Australian Financial Review, Robb Report and Property Observer – since graduating in Media from Macquarie University, William has always had a passion for cars.

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