The peak body for road transport companies in Western Australia has warned the nation faces another AdBlue shortage unless the federal government supports new onshore manufacturing.
Technically known as diesel exhaust fluid, AdBlue is an anti-pollutant added to most modern diesel engines, including in trucks and some farm equipment.
There was a national shortage of it late last year when China stopped exporting urea, the key ingredient in AdBlue.
In response, the Morrison government tipped almost $30 million into Queensland company Incitec Pivot to ramp up its AdBlue manufacturing, which catered to most of Australia's requirements.
But Incitec Pivot Limited (IPL) will close its Gibson Island facility at the end of the year and cease manufacturing AdBlue.
Western Roads Federation chief executive Cam Dumesny said Australia was facing another shortage and potential bowser price increases unless another domestic manufacturing solution was created before the end of the year.
He said the price of AdBlue doubled this year and without onshore production Australia's freight and agricultural industries were "vulnerable" to global supply disruptions.
"The Australian Trucking Association, ourselves and other associations have asked the federal government to start planning what are we going to do about securing supply when that plant closes," Mr Dumesny said.
Gassed out
In a statement IPL said it would proceed with a plan announced last November to cease operating at Gibson Island on December 31, 2022.
"The decision to end manufacturing was made reluctantly due to being unable to secure affordable feedstock gas supply from the east coast gas market," the statement said.
"Since January, significant quantities of Australia's AdBlue supply have been manufactured and distributed by IPL.
"Importantly, our AdBlue production has had no impact on the supply of fertilisers relied on by Australian farmers."
Mr Dumesny said he was not aware of any urea being manufactured to the grade required to produce AdBlue anywhere else in Australia.
"We are very much behind the concept of onshore manufacturing, identifying our sovereign capabilities," he said.
"There are people who have gone and turned the AdBlue system off — they risk serous fines, because it increases emissions and they're in breach of the emissions controls that are regulated."
Mr Dumesny said if Australia returned to buying AdBlue on the global market prices were likely to increase.
"If it was going to decrease [in price] we'd already be importing it," he said.
'Cost of farming crisis'
The National Farmers Federation (NFF) is also concerned about future supply of AdBlue and other critical farm inputs.
Acting chief executive Charles Thomas said the organisation would be horrified to see domestic production close off without a plan in place.
"It is not just AdBlue adding pressure to farmers' bottom lines — it is a whole series of things that are compounding to create what is almost, at this point, a cost of farming crisis in Australia," Mr Thomas said.
The NFF is calling for the federal government to use part of its $500m national reconstruction fund to support the domestic supply and manufacturing of AdBlue.
"If resilient supply required local subsidisation of the industry, then that is something that we think we'd have to support," Mr Thomas said.
Energy Minister Chris Bowen's office was contacted for comment.
