Locally produced supplies of a crucial diesel exhaust fluid have ramped up significantly, with 3 million litres of AdBlue produced in Australia over the past week, but a long-term supply plan is yet to be finalised.
A shortage of the product sent the federal government scrambling to find new sources in December, and a deal was reached with local fertiliser manufacturer Incitec Pivot Limited (IPL) to increase production in Queensland.
Supplies in Australia had been running dangerously low and there were concerns trucks would be brought to a halt, but Energy Minister Angus Taylor said stocks were now being replenished.
"Incitec Pivot last week achieved a significant milestone producing over three million litres of AdBlue in the week, representing around 75 per cent of Australia's AdBlue needs," he said in a statement.
"This locally produced AdBlue is already flowing through the domestic supply chain to wholesalers and service stations across the country."
IPL managing director Jeanne Johns said the 3 million figure was an 800 per cent increase on what it produced in early December, and the company's Gibson Island plant in Brisbane was now working 24 hours, seven days a week.
"The hard work will continue as we aim to further increase production of AdBlue at Gibson Island in the coming weeks and months to meet Australia's needs," Ms Johns said in a statement.
AdBlue is a trademark brand of urea-based diesel exhaust fluid that acts as an anti-pollutant in diesel engines and is vital to the freight and logistics sectors.
'Still not out of the woods'
The additional supplies of AdBlue have been welcomed by Heavy Vehicle Industry Australia.
The organisation's CEO Todd Hacking said while it was good news, he warned there was still more work to be done.
"That 3 million litres a week is really helping to stabilise the current shortage and we are seeing the day-by-day improvement of AdBlue nationwide," he said.
"It's still a day-by-day proposition, but we are certainly in a much more stable position with supply than we were pre-Christmas.
The government will not outline exactly how much fluid is available for use, but Mr Taylor insisted there was no need for panic anymore.
Mr Taylor acknowledged that while there were now more supplies, there were still issues.
"Although AdBlue users may continue to see a few sites occasionally stocked-out, they can be reassured that with the new AdBlue supply coming into the market, these sites are now being progressively replenished," he said.
Mr Hacking said he was "cautiously optimistic" about future supplies, but that without the IPL deal, Australia would have been in "a great deal of strife" in the short term.
Future supply remains uncertain
IPL will continue to produce 3 million litres per week for now, but Mr Hacking has questioned how long term supplies will be secured.
"The ongoing challenge is what happens in the medium and long term when this IPL deals comes to an end," he said.
It is something that government and industry are still trying to work through, with the government looking at whether supplies can be secured from the Middle East.
Until now, the majority of Australia's supplies came from China. Mr Hacking said diversification was essential.
"The lesson out of this is that for such a critical good we can't just rely on one country to supply it," he said.
Australia struck a deal with Indonesia late last year to provide 5,000 tonnes of refined urea in January, but it is yet to arrive.
It is understood the fluid will be split across several shipments, with some set to arrive in the coming days and others to come in February.
IPL is also expected to begin a trial of producing technical-grade urea from the middle of next month. If successful, IPL would also still manufacture AdBlue.
National Farmers Federation CEO Tony Mahar said the government should focus on local options.
"The collaboration with Incitec Pivot to manufacture AdBlue onshore is commended and should be viewed as a blueprint for the development of further domestic manufacturing, in particular, of essential inputs," he said.
Prices still high despite increased supply
The cost of AdBlue skyrocketed last year, with some transport companies reporting prices had quadrupled.
Prices are still higher than average, with a Canberra shop selling 10 kilograms of AdBlue for $79.99 this week, which the store said was a $10 saving.
Some shops have limits on purchases due to the shortage of fluid. Mr Taylor urged people not to panic buy.
"To ensure stocks can be replenished across the country, I continue to encourage industry to purchase stocks only when needed and at normal levels," he said.
The Australian Competition and Consumer Commission has said it will investigate any evidence of price gouging.
