Australian farmers have warned that threats to fuel imports and panic buying could impact food supplies in coming weeks.
Farmer representative body AgForce said disruptions were already affecting farmers’ access to the critical inputs needed to keep farm operations running.
This came as the Federal Government and the Australian Competition and Consumer Commission announced steps to prevent fuel price gouging.
The Government said in a statement that there would be more scrutiny and surveillance of the fuel sector, bigger penalties for misconduct, and action to shore up fuel supply.
It said that fuel stock continued to arrive in Australia on time. The issue was “localised disruption due to significant spikes in demand”.
The ACCC announced late yesterday that it would urgently meet with fuel market participants to seek more detailed explanations for recent pricing conduct.
AgForce General President, Shane McCarthy, said the current situation highlighted how quickly Australia’s fuel supplies could come under pressure.
“It is stunning how fast fuel security has become an issue, especially in regions where the food and fibre for the nation is grown,” Mr McCarthy said.
“If the tractors and the trucks stop running, the shelves at the supermarket will be empty. There will also be animal welfare concerns, as trucks carrying livestock won’t be able to get to their destination without fuel.”
AgForce said that, while fuel imports into Australia were continuing at this stage, panic buying was placing pressure on local supply and some fuel stations were already running dry.
“Independent suppliers are facing tighter supplies, and in some cases regional fuel stations have either run out of fuel or introduced restrictions, while some distributors are cancelling farmers’ orders,” AgForce said in a statement.
AgForce Grains President, Brendan Taylor, said producers were facing these fuel distribution challenges at a critical time in the farming calendar.
“With farmers across the state either harvesting summer crops, or preparing for winter planting, we’re in a period of high demand for fuel and fertiliser,” Mr Taylor said.
“Fertiliser is a vital part of putting food on the table for everyday Australians. Without it, crops either aren’t planted or yields are significantly reduced, which ultimately means less food reaching supermarket shelves.”
Mr McCarthy said the agriculture industry had long raised concerns about Australia’s reliance on imported agricultural inputs.
“Farmers and representative organisations like AgForce have been warning for some time that Australia’s reliance on imported fuel and fertiliser leaves us vulnerable,” he said.
“If we run short of fuel or fertiliser, it has serious implications not just for farmers but for Australia’s food supply.”
The ACCC said in a statement that it would start weekly market updates to provide increased transparency to consumers and enhanced scrutiny of retailers’ behaviour.
ACCC Commissioner Anna Brakey said the commission was aware of the impact of higher prices on Australian consumers.
“We are closely watching market behaviour and if there is conduct that is collusive or misleading or deceptive, we will investigate it and take action where appropriate,” she said.
“The petrol industry should be under no illusions. We will act decisively and to the fullest extent of the law.
“We are aware of concerning reports about diesel availability in regional and rural Australia. We know how critical diesel supply is to primary producers, transport businesses and many others, so we are prioritising our work to assist with this.”
Ms Brakey said the ACCC was able to authorise conduct, such as coordination or agreements relating to distribution, where it provided a net public benefit.
“We stand ready to receive an application for authorisation,” she said.
In a joint statement, Treasurer Jim Chalmers, Minister for Climate Change and Energy Chris Bowen and Assistant Minister Andrew Leigh said action would be taken to protect consumers.
“The conflict overseas shouldn’t be an excuse to profit off Australians,” they said.
“We’re putting petrol companies on notice. We won’t cop big corporates treating Australian consumers like mugs.”
The Government announced the following actions.
- Double penalties for false or misleading conduct and cartel behaviour (to a maximum of $100 million per offence), across the economy.
- Task the ACCC to ramp up fuel price monitoring, reporting weekly, with a focus on unusual price spikes.
- Work with industry to increase fuel supply to service stations, including by helping the fuel sector secure ACCC authorisation to coordinate supply and unlock bottlenecks.
“The recent conflict in the Middle East has compounded uncertainty in the global economy and led to significant volatility in oil and petrol prices,” the Ministers said.
“Just in the last three days, we have seen global oil prices jump to almost $120 per barrel, fall back to $80 per barrel this morning, then rise above $90 per barrel in a matter of hours. It was around $60 at the start of the year.
“We’re not immune from uncertainty and volatility in the global economy, but these measures are about ensuring petrol suppliers are doing the right thing and ensuring the minority of bad actors can’t hurt regional Australians or farmers.”
The Ministers said that, despite global price volatility, Australia’s fuel supply remained secure.
