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Highlights
- Australia is running through another supply chain crisis.
- AdBlue stock has been dangerously falling, creating chaos in the market.
- The Australian Trade Minister Dan Tehan has urged businesses to avoid stockpiling AdBlue.
The global shortage of urea has forced Australia to search for new mineral sources. As a result, the Australian Federal Government has approached the Middle Eastern nations for help.
Drastically falling Adblue stocks have threatened the Australian trucking industry. The industry fears to shut down without new suppliers. Adblue is an essential fluid to reduce pollution from diesel engines, mostly made from water and urea.
What is the reason behind the crisis?
The main reason behind the crisis is the shortage of synthesised urea- which is an ingredient that local AdBlue makers import for China and Russia. Synthesised urea is widely used from fertilisers and cosmetics to plywood and has a higher demand from the agricultural sector, which has led to its global supply shortage.
China began restricting the exports of synthesised urea in July. As a result, the international prices soared 50% between September and October this year, but it wasn’t enough to stabilise its demand and supply as nearly 80% of urea stock come from China. Last week when the Australian Trucking Association warned that AdBlue stocks would run out in February 2022.
RELATED READ -- Uncertainty around economic recovery deepens amidst the global supply chain crisis
As a result, the Australian Trade Minister Dan Tehan has urged businesses to avoid stockpiling AdBlue to prevent this global crisis connected to the Chinese grip on the market.
