Dean Smith (WA, Liberal Party, Shadow Assistant Minister to the Shadow Treasurer) Share this | Hansard source

I rise to speak on this urgency motion because it goes to the heart of something this government should have secured a long time ago—Australia's sovereign capability in fertiliser supply. This is not a minor supply chain issue; it is a case study in how exposed Australia has become under the Albanese Labor government to external shocks in the critical imports needed to keep this country running.

Fertiliser underpins food production, mining and regional economies. In Western Australia in particular, ammonia is critical not only for agriculture but for the explosives that drive our resources sector. Australia's largest ammonia plant in the Pilbara—a place I know well—is shut for two months after a power outage damaged equipment on the site. It produces around 850,000 tonnes of ammonia a year, with a significant share feeding technical ammonium nitrate for mining and urea fertiliser. So, at precisely the moment global supply has tightened, local capacity has been limited. This leaves us at the mercy of external factors during a period of historic global uncertainty. In 2024, Australia consumed 8.7 million tonnes of fertiliser but imported 7.9 million tonnes. Domestic production has fallen to just 1.3 million tonnes, around 15 per cent of total consumption. Rather than being resilient, we are dependent, and much of that dependence runs through the world's most volatile chokepoints. More than a quarter of global ammonia trade and 43 per cent of urea shipments pass through the Strait of Hormuz. Australia sources more than half of its urea imports from Gulf nations, so when conflict disrupts that route, Australia is hit immediately. Supply is tightening and prices surging, rising from around $870 a tonne in late February to more than $1,200 a tonne and, in some areas, as high as $1,600 a tonne. Grain Central reports the world market is now struggling to send supply our way as the halt to shipping from the Persian Gulf enters its fourth week.

For farmers, this is not just about price. Timing is everything in farming. Fertiliser that arrives too late is not a solution, as Grain Producers Australia chair Barry Large made clear. Saying it will arrive in two weeks does not solve the problem. Growers in Western Australia are already being forced to rethink cropping decisions, reducing wheat plantings, shifting crops or cutting inputs altogether. As industry leaders are warning, if supply remains tight, some land will simply not be planted, and that incidentally is how food risk and insecurity begin—not with empty supermarket shelves overnight but with delayed seeding, reduced inputs, lower yields and less confidence to plant. The National Farmers ' Federation has said that while current shipments may help secure this winter crop there is no confidence about supply beyond May, a point a Labor senator reiterated in her remarks. If in-crop requirements cannot be met, the winter crop in Australia could be halved. Those are not words that any government should hear and simply shrug off.

Agriculture is not the only sector exposed. Western Australia's mining industry relies on technical ammonium nitrate as explosives to sustain iron ore production. If supply is constrained, miners will be forced to rely on stockpiles or source alternative supplies at short notice. At a time when Australia should be strengthening sovereign industrial capability, this government has presided over growing fragility in a critical input for both agriculture and resources sectors. Fuel insecurity is compounding the problem. Farmers are already warning about difficulties obtaining enough diesel for seeding and harvest. Miners are experiencing the same shortages. Diesel prices have surged. The result is that they are being squeezed from both sides now—uncertain fertiliser and uncertain fuel.

Again, this is why sovereign capability matters. Australia has the gas, the industrial base, the agricultural demand and the strategic need to do better than this, yet under Labor we remain exposed to a single point of failure in global supply while domestic production has declined and contingency planning has lagged. The Albanese government has failed in this regard, and Australian farmers and Australia's regional communities and critical industries are now paying a very high price for Labor's lack of preparedness.