The supply shortage of urea that resulted in the rising global prices of fertilizers has now threatened the supply chain in Australia.
Warren Clark, the CEO of the National Road Transport Association of Australia, said that half of the nation’s trucks that run on diesel require urea-based exhaust fluid to keep running. AdBlue is an additive used in modern diesel trucks to improve air quality by cutting down on nitrogen dioxide emissions.
As per Bloomberg news, demand for natural gas and coal has increased due to the shortage of supplies in China and Europe in the power and heating sector. This has resulted in the reduction of fossil fuels availability as a feedstock for the production of fertilizers and consequently sent the prices soaring to a record high.
Major exporters China and Russia have curbed shipments of fertilizers leading to a supply crunch. South Korea had secured the services of military transport planes last month to ship urea from Australia and Vietnam who are also facing a shortage.
According to Clark, it is estimated that the supplies could dry up by February though it could be earlier. The continued impact of Covid-19, shortage of labor, including drivers, and industrial actions at ports could impact the road freight. This has led to the National Road Transport Association discussing the matter with the Government.
Australia currently has stocks of more than 15 billion liters of AdBlue supplies which can cater to five weeks of usual business demands and with multiple shipments in the pipeline for urea supply. This will give an additional two weeks of supply as per Angus Taylor, the energy minister. He said that it would be unhelpful and unnecessary if consumers and businesses buy additional additives and stock them.
According to Taylor, the Government is working to ensure that there are no shortages, and they are taking steps to address global pressures in the Urea supplies. The Government will take measures to keep the motorists and trucks running on Australian roads.
