Australia looks to Southeast Asia for fertiliser amid supply crunch

The Albanese Government is in talks with Southeast Asian countries in a bid to find Australia more fertiliser as the Iran war chokes off supply routes at a critical time for WA agriculture. With Iranian drones and missiles making the Strait of Hormuz too perilous to transit, 30 per cent of the world’s fertiliser supply has been cut for weeks, spurring warnings of a “food security timebomb”. Australia is especially vulnerable as it sources some 60 per cent of its urea — the most widely used nitrogen fertiliser for boosting crop yields — from the Middle East. WAFarmers’ Livestock Section President Geoff Pearson said sourcing additional supply channels was a “great move” by the Government, but warned that the clock was ticking with the season set to begin. “Timing is critical. If we rely on a single source it’s definitely in Australia’s favour to source other markets,” he said, adding that farmers were keen to move swiftly after a period heavy rainfall. “We need to make sure we’ve got enough fertiliser to keep food on the table.” Farmers are already having to absorb higher diesel costs. Agriculture Minister Julie Collins said on Sunday that Canberra was talking with countries nearby to try to make up the loss. Grocery prices could rise between 3 per cent and 4 per cent, based on Treasury estimates cited by Ms Collins, as high fuel and fertiliser input costs make their way through the economy. “There’s enough fertiliser in Australia today and on its way on the water in terms of the initial planting season,” Ms Collins told Sky’s Sunday Agenda. “But this is about longer term supplies because of the unpredictability and we don’t know how long this is going to go.” She said the government was “talking to a range of countries in relation to fertiliser”, but singled out discussions with Indonesia and Malaysia. “There’s been some discussions with Indonesia. There’s been some discussions with Malaysia. But more broadly, across Southeast Asia,” Ms Collins said. Until Perdaman’s urea fertiliser plant near Karratha starts producing mid-next year, Australia is entirely reliant on imports. The mammoth industrial development was set to cost nearly $6.5 billion at last count. Fertiliser supplies took an ill-timed blow in March when a unplanned power outage hit Yara Australia’s plant in the Pilbara. The operation would be out of action for at least two months, the company said at the time. Moves to secure fertiliser come ahead of Anthony Albanese’s visit to Malaysia next week. The Prime Minister is expected to seek guarantees that Malaysia will continue shipping refined fuel to Australia after its embassy said the country would “prioritise our own needs” before looking at foreign demand. But Malaysia is also at the mercy of whatever upstream oil supply it can get from the Middle East. International Rescue Committee (IRC) last week warned fuel and fertiliser shortages would compound global food security crises caused by existing wars and create new crises without urgent action. “The war in Iran has unleashed a triple emergency: a surge in humanitarian need, a global economic shock, and a system already stretched to breaking point by more than 60 simultaneous conflicts,” the aid group’s president and chief executive David Miliband said. “The IRC is warning today of a ticking food security timebomb: if the Ukraine shock drove hunger to record highs within weeks, what is now unfolding threatens to be exponentially worse. “The window to avert a massive global hunger crisis is rapidly closing.” In her interview on Sunday, Ms Collins repeated the government line acknowledging “tail to this war” but said “we are more food-secure than a lot of other nations”. “Australia does produce more food than we consume. But obviously there are critical points along that supply chain,” Ms Collins said, adding that the government was “doing everything we can in terms of supporting our farmers”.