Australian officials are frantically searching the world for a key chemical needed to start diesel trucks – as a minister admits the country has only five weeks’ supply left.
Stocks of additive urea, a key ingredient in AdBlue, are running out globally after China this year banned exports in an attempt to curb fertilizer prices – a key component of food production.
Modern diesel engines that drive trucks, engines and four-wheel drive do not start unless AdBlue has been added to the exhaust system to reduce the level of nitric oxide pollution.
With half of Australia’s diesel-powered trucks, that means many goods may not reach supermarket shelves this Christmas, as many family cars are forced off the road.
Now, Energy Minister Angus Taylor has admitted that Australia’s existing supplies are likely to run out in mid-January and has appointed a former Donald Trump adviser to help devise a solution.
Gas stations are now running out of stock and are forbidding customers to panic about buying more AdBlue than they need.
Australia is panicking over a key chemical needed for diesel trucks to start with a minister admitting there was only a five-week supply left (pictured is a Woolworths truck in Sydney)
Now, Energy Minister Angus Taylor has admitted that Australia’s existing supplies are likely to run out in mid-January and has appointed a former Donald Trump adviser to help devise a solution.
Taylor’s office released a statement late Thursday night revealing that Australia had 15 million liters of AdBlue left in stock “equivalent to close to five weeks of business-as-usual demand”.
Shipments on their way to Australia would provide an additional “two weeks extra supply to the market.”
Taylor blamed China, Australia’s largest trading partner, for the crisis without specifically mentioning their export ban on refined urea.
“Global supply pressures stemming from increased domestic use in China have led to international problems in securing refined urea, which is the key to producing AdBlue,” he said.
In a bizarre setback, Deputy Prime Minister Barnaby Joyce was supposed to spearhead Australia’s response to the urinary crisis, but he is now in quarantine in Washington with Covid just a week after his advisers met with the National Road Transport Association.
In his absence, Mr Taylor and Commerce Secretary Dan Tehan have brought together industry leaders.
“I can assure the Australians that the government is working to ensure that we do not face any shortage,” Taylor said.
“We work quickly and actively to ensure that supply chains of both refined urea and AdBlue are secure so that the industry can have security for their operations.”
Mark McKenzie, CEO of the Australasian Convenience and Petroleum Marketers Association, told the Daily Mail Australia that his service stations, including BP, now banned customers from panicking about buying more AdBlue than they needed.
“In relation to our fuel dealers, for obvious reasons we get a bit of a ride with the product at gas stations,” he said.
“We use measures as a price to discourage bulk buying, but because it’s such an important issue, it does not seem to deter them either.
“If we continue to see this behavior, we will move to a strategy that prevents runout.”
Modern diesel engines that drive trucks, engines and four-wheel drive do not start unless urea is added to the exhaust system to reduce the level of nitric oxide pollution
Sir. McKenzie said gas stations did not yet resort to rationing, but would prevent customers from filling up jerrycans.
“We will allow them to get the normal level they need to put in the AdBlue reservoir, but we will not allow people to fill jerrycans and the like at gas stations,” he said.
“It’s panic buying because they’re trying to fill all the vessels they can.”
Australian Trucking Association chairman David Smith said the government was unable to guarantee AdBlue supplies after February 2022.
“We were told that there was no need to panic about the delivery of AdBlue, but no one was prepared to back up this insurance with any figures on the AdBlue supply,” he said.
‘The delivery of AdBlue is as important as the supply of fuel.
“We need transparency about the stock of materials in Australia and the ability of suppliers to deliver the AdBlue we need throughout the first half of 2022.
“We are already seeing suppliers restrict orders or raise prices.”
Mark McKenzie, CEO of the Australasian Convenience and Petroleum Marketers Association, told the Daily Mail that Australia service stations are now banning customers from panicking about buying more AdBlue than they needed.
The chemical manufacturer Incitec Pivot supplies 10 percent of Australia’s AdBlue and is the only company headquartered in Australia that produces urea.
It is also the only company in Australia that manufactures AdBlue from urea smelters.
But in November, CEO Jeanne Johns announced that it would stop producing urea and other fertilizers at the Gibson Island plant in Brisbane from December 2022, citing an error in securing a natural gas deal.
Taylor blamed insufficient natural gas supplies for low urea production in Australia.
“This is exacerbated by the global shortage of natural gas, the essential ingredient used to make urea,” he said.
Incitec Pivot has signaled to the Daily Mail Australia a willingness to increase domestic production before closing production in a year.
DGL, a New Zealand-based chemical company listed in Australia, manufactures urea for AdBlue using a different approach to Incitec Pivot.
China supplies 80 percent of the Asia-Pacific’s diesel quality urea, but its National Development and Reform Commission announced in July that it would crack down on manure hoarding, leading state-owned companies to limit their exports.
Taylor has formed an AdBlue Taskforce with Andrew Liveris, the former chairman and CEO of The Dow Chemical Company, as a former adviser to former U.S. President Donald Trump’s American Manufacturing Council
This has prompted other countries to fight for supplies from alternative markets with South Korea, which on Tuesday signed an agreement with Indonesia of 120,000 tonnes a year.
Saudi Arabia and Qatar also produce refined urea, with Europe also competing for supplies after the end of Covid restrictions.
AdBlue, a diesel exhaust fluid, contains 32 percent urea and 68 percent deionized water.
Sir. Taylor has formed an AdBlue Taskforce with Saudi Aramco CEO Andrew Liveris, the former chairman and CEO of The Dow Chemical Company, as a former adviser to former U.S. President Donald Trump’s American Manufacturing Council.
James Fazzino, former CEO of Incitec Pivot, President of Manufacturing Australia, will lead this task force, which will also include Drs. Cathy Foley, Australia’s Chief Scientist.
.
Post a Comment