Another supply chain disaster is approaching – and this time, it could spell enormous headaches for both everyday Australians and major industries alike.
The supply chain crisis wreaking havoc around the world is set to take a step forward, amid reports a catastrophic shortage could soon force everyday Australian motorists off the road.
In short, the world is facing a major shortage of a key ingredient found in diesel exhaust fluid (DEF) – also known as AdBlue – with the situation set to come to a head this summer.
The key ingredient in question is urea, which helps reduce emissions – an essential requirement of many diesel vehicles, including both trucks and private vehicles.
But urea supplies from China have recently run short, causing headaches for many countries, most recently in South Korea, which last month collected tens of thousands of liters of the essential commodity for Australia as a military oil The tanker took off.
South Korea has since banned the export of urea and rationed DEF purchases to ease the crisis.
China is a major supplier of urea to the Asia-Pacific region, however, the nation has recently largely reduced exports of the commodity to drive down domestic fertilizer prices. This is because urea is also a major component of fertilizer due to its high level of nitrogen.
Australia is a big importer of urea, 80 percent of our supply comes from China – and while we make some urea locally, it’s not enough to solve the issue.
Now, Australia is about to feel the pinch, with those aware of the impending crisis affecting AdBlue reportedly attempting to stockpile supplies.
However, it is understood that there is not enough product available to avert the problem, with rumors swirling that supply could drop to critical levels within weeks, or by March 2022 at the latest.
If that happens, thousands of private cars and commercial trucks could be forced to take to the streets as the busy holiday season begins.
‘Can’t wait another week’
An Australian Trucking Association spokesperson told news.com.au that the reduction could have a major impact on all Australians.
“If this is not addressed, trucking businesses will have increasing difficulty obtaining AdBlue,” the spokesperson said.
“We could see trucks moving off the road, affecting deliveries like fresh fruits, vegetables and meat to supermarkets.
“AdBlue suppliers are restricting deliveries now, but the situation could get worse in the new year if the government does not act.
“The reduction will also affect late model diesel cars and utes that require AdBlue.”
He said the situation would “really take a bite out of Christmas” and come to a head in February to March, when stockpiled supplies are expected to run out.
“The Australian Trucking Association began briefing government officials on 11 November,” he continued.
“We helped arrange a series of follow-up discussions between the Office of Supply Chain Resilience (OSCR), trucking businesses and DEF suppliers.
“We have now started meeting with ministerial offices. The issue can’t wait another week. It definitely can’t wait ’til after Christmas.
According to the ATA, it was important that Australia’s diplomats and trade staff overseas be tasked with providing assistance to Australian DEF suppliers in their efforts to source urea.
“The Department of Infrastructure, Transportation, Regional Development and Communications and the national heavy vehicle regulator should work with truck manufacturers to determine the engineering feasibility of deactivating the emissions control systems of selected trucks if DEF deficiencies are severe.” ,
Government ‘aware’ of crisis
A spokesman for Deputy Prime Minister and Transport Minister Barnaby Joyce told news.com.au in a statement that the government was “aware” of the issue.
“The government is aware of concerns regarding the supply and availability of AdBlue and is continuing to monitor the situation,” the spokesperson said.
“We encourage industry operators to continue operating as normal.”
Comes behind the lack of AdBlue serious semiconductor supply issues, which has led to stock restrictions and short sales in the new car market.