If disruption to food and energy systems has become persistent rather than episodic, Australia needs better ways to test how those systems perform under sustained and overlapping shocks. In short, it should apply stress-testing to them, much as stress-testing is routinely applied in finance and defence planning.
Australia should expect persistent disruption to its food and energy systems as threats such as climate extremes, export restrictions, supply-chain threats and geopolitical tensions worsen. These threats increasingly interact at the same time, rather than emerging as single shocks. Planning built around isolated scenarios struggles to capture this reality.
Stress-testing offers a practical way to address that gap. The idea is straightforward: expose systems to demanding hypothetical scenarios and examine whether they continue to function. Instead of assuming stability, policymakers deliberately test how supply chains, markets and decision-making processes behave when several pressures arrive together.
Financial regulators have used this method for years. Banks are regularly tested against severe economic scenarios to ensure they remain solvent during crises. Defence planners use similar exercises to test operational readiness. Yet food and energy systems – which are just as critical to national security – are rarely examined with the same discipline.
Australia’s experiences in recent years have demonstrated the risks of that gap. During global supply disruptions, fertiliser markets tightened rapidly. Energy markets became volatile following geopolitical shocks. At the same time, climate-driven disruptions affected agricultural production and transport networks. Each event placed pressure on the system, but the greater challenge came from their interaction.
Single-scenario planning cannot capture these dynamics. Stress-testing allows policymakers to explore compound disruption – for example, a severe drought coinciding with fertiliser shortages and shipping delays.
A practical stress-test could simulate a severe drought in eastern Australia occurring at the same time as fertiliser shortages and congestion at major export ports. Policymakers could examine how quickly fertiliser imports could be redirected, whether alternative logistics routes could maintain grain shipments, and which regulatory adjustments might be required to keep supply chains functioning. Exercises such as this would not aim to predict a specific crisis, but rather to reveal hidden dependencies and decision bottlenecks before they appear in real disruptions.
These exercises would ideally be coordinated across government sectors rather than being run in isolation. Agriculture, energy, transport and national security agencies each see different aspects of the system. Bringing them together in joint stress-testing exercises would allow policymakers to understand how pressures in one sector quickly cascade into others.
Stress-testing also improves decision-making. When policymakers face unfamiliar crises, the most damaging delays often occur in the early stages, when institutions are still diagnosing the problem. Regular exercises shorten this learning curve. Officials become familiar with potential failure points and the policy tools available to address them.
Importantly, effective stress-testing does not require major new institutions or large budgets. Much of the necessary expertise already exists across government entities. Departments responsible for agriculture, energy, transport and national security regularly analyse risks within their own domains. The challenge is integrating those perspectives into shared exercises that examine system-wide resilience.
Such exercises could be conducted periodically, bringing together officials, industry participants and analysts. Scenarios would deliberately combine various disruptions, including climate events affecting production; sudden export restrictions; shipping bottlenecks; or energy market shocks. Participants would test how quickly policy responses could be coordinated and whether alternative supply pathways remain viable.
Over time, these exercises would generate practical insights. Policymakers could identify critical points of failure in logistics networks, regulatory bottlenecks that slow emergency responses, or areas where supply diversification is insufficient. Stress-testing would therefore complement other resilience measures such as diversification and redundancy.
Another benefit relates to culture. Stress-testing encourages institutions to think in terms of adaptation rather than restoration. Instead of assuming that systems will quickly return to normal, policymakers would learn to operate under prolonged volatility. That shift in mindset is increasingly important as geopolitical competition, climate disruption and economic fragmentation interact across the Indo-Pacific.
The objective is not to predict the exact form of the next crisis. Stress-testing recognises that uncertainty cannot be eliminated. What it can do is ensure that when disruptions occur, policymakers already understand how systems behave under pressure and what options remain available.
Australia’s food and energy systems are among the most sophisticated in the region, but sophistication alone doesn’t guarantee resilience. As volatility becomes a structural feature of the strategic environment, systems should be designed not only to recover from shocks but to function under them.
Stress-testing is a practical way to ensure they can.