Taskforce probes diesel crisis amid warning of panic buying

Consumers have been warned not to panic buy, amid a shortage of an additive crucial to the trucking industry and modern cars.

Industry Minister Angus Taylor has warned against panic buying of a key diesel additive. Picture: NCA NewsWire / Martin Ollman

Australia has less than five weeks’ supply of diesel exhaust fluid for the nation’s trucking fleet with another fortnight’s supply to be generated from a key ingredient on its way from overseas, according to the Morrison government.

Industry Minister Angus Taylor has warned businesses and consumers against panic buying of DEF, instead urging industry to maintain normal levels of the fluid sold as AdBlue.

Mr Taylor has formed a special taskforce to investigate ways of shoring up the supply of DEF, which the trucking industry has warned could fall off a cliff before the end of summer, smashing the nation’s supply chains.

If this were to occur, it would also affect many modern diesel cars built with the most efficient European anti-pollution technology.

But Mr Taylor has cautioned that, based on current supplies and demand, the AdBlue market appeared to be sustainable in Australia.

“We are quickly and actively working to ensure supply chains of both refined urea and AdBlue are secure so that industry can have certainty on their operations,” Mr Taylor said in a statement.

“Global supply pressures, stemming from increased domestic use in China, have led to international issues in securing refined urea, which is key to producing AdBlue. This is exacerbated by the global shortage of natural gas, the essential ingredient used to make urea.

“I can assure Australians that the Government is working to ensure we do not face any shortages. We are pursuing a range of measures to address global pressures in the urea market. We will keep our trucks running and Australian motorists on the road.”

A government taskforce will be led by Manufacturing Australia chairman James Fazzino and Andrew Liveris, the former chairman and CEO of The Dow Chemical Company, and Australia’s chief scientist Dr Cathy Foley.

The taskforce was announced by Mr Taylor and Trade, Tourism and Investment Minister Dan Tehan.

The Australian revealed last week that the trucking industry was concerned thousands of vehicles could be forced off the nation’s roads amid dwindling supplies of DEF.

DEF is used in modern trucks and cars to help reduce pollution but urea, which can be used as a fertiliser and feed supplement, makes up a third of DEF.

DEF is injected into the exhaust system to reduce the amount of pollution entering the atmosphere.

But the supply of higher quality urea, mainly from China, has been slashed, leading to global shortages.

National Road Transport Association chief executive Warren Clark has warned that DEF was at risk of becoming the industry’s toilet paper, with many businesses rushing to buy stock ahead of a feared collapse in supply.

Some major trucking operators are concerned that supplies will be rapidly depleted if companies and motorists rush out to obtain extra supplies before Christmas.

The NRTA estimates up to half of all diesel trucks could be garaged by February because of the shortfall, with vehicles unable to operate legally without the emissions controls; it is also fraught to try to circumvent the diesel exhaust cleaning systems because there is no guarantee vehicles will operate properly or components won’t be damaged.

Mr Taylor said the taskforce would work across government and with industry to develop solutions to any potential future supply constraints.

“Options being explored include alternative international supply options for refined urea, bolstering local manufacturing capabilities and technical options at the vehicle level,” he said.

“Australia currently has normal levels of stocks to hand of AdBlue, with more refined urea stocks on their way to Australia.

“There are currently in excess of 15 million litres of AdBlue supplies on hand, which is equivalent to close to five weeks of business-as-usual demand.

“There are multiple shipments of refined urea currently on their way to Australia, which are estimated to provide over two weeks of additional supply to the market.’’