While fuel shortages attract attention, disruptions to shipments in fertilisers or chemicals are just as damaging to our national economy. Australia needs a broader resilience strategy that minimises the vulnerabilities of complex supply chains.
Global supply chains of fertilisers, chemicals, pharmaceuticals and manufacturing inputs depend on maritime flows through a small number of chokepoints which, if disrupted, can rapidly cause shortages. These can occur far from the origin of the disruption, and Australia’s distance from much of the world offers little protection. Australia has limited domestic production capacity in many sectors and relies heavily on imports through global supply chains.
The Covid-19 pandemic exposed the fragility of global supply chains. Shortages of medical equipment, pharmaceuticals and manufacturing inputs revealed the risks of relying on production hubs. Governments moved quickly to prioritise domestic needs, reshaping global markets through export controls, production restrictions and disrupted logistics. During the crisis, Australia renewed discussions about sovereign capability, supply chain diversification and economic security. Yet several years later, progress in many sectors remains slow.
Australia’s overreliance on imports was again exposed in 2021 when China restricted exports of urea, a key component of the diesel exhaust fluid AdBlue used in trucks and heavy vehicles. Australia was at risk of shutting down its national road transport fleet, potentially affecting supermarket deliveries, fuel distribution and agricultural logistics within weeks.
The government eventually installed emergency measures and diversified supply chains, but the incident demonstrated how disruptions in a relatively minor industrial input could quickly become a national vulnerability.
The government needs to continue improving its domestic production capacity, the key structural solution for strengthening sovereign supply. Project Ceres, the development of a major fertiliser and urea facility in Karratha, represents a significant step, but it’s still years away from full operation. With an investment of US$4.5 billion (about A$6.4 billion), the facility will become Australia’s largest urea plant, producing around 2.3 million tonnes annually. The project aims to strengthen national food security and reduce reliance on imported fertilisers, backed by a 20-year gas supply agreement with Woodside and an offtake agreement with Incitec Pivot.
Complex fertiliser supply chains, on which both agricultural security and food security depend, expose a deep connection between economic resilience and national security. Agricultural productivity relies heavily on imports of nitrogen, phosphate and potash. Supply disruptions would reduce yields and eventually raise food prices or limit supermarket stocks. Therefore, simply expanding domestic food production doesn’t guarantee food security, if it continues to rely on fertiliser imports that are vulnerable to global disruption.
Twelve months ago, ASPI released a landmark Food Security Preparedness Green Paper highlighting the importance of upstream supply chains that underpin food production. Fertilisers, chemicals and other industrial inputs support both agriculture and the broader food system. These initiatives recognise the need for a coordinated approach that synchronises preparedness across production, transport, logistics, processing, manufacturing, retailing and consumer awareness. In late 2025, a National Food Council was established and the government announced the development of a National Food Security Strategy, Feeding Australia.
Emerging research also highlights the importance of sovereign capability in food biotechnology and biomanufacturing. A November 2025 report released by the Australian National University, Made & Grown: The Future of Food, illustrates how technologies could strengthen food system resilience. These approaches expand the idea of food production beyond traditional agriculture into advanced manufacturing systems. Developing sovereign capability in these areas represents a once-in-a-generation opportunity for Australia to reshape its food system, strengthen domestic resilience and become a leader in bioeconomy.
Many Australian industries beyond agriculture depend on imported chemicals, machinery components and advanced materials. These include pharmaceuticals, food processing, packaging and advanced manufacturing. When supply chains tighten, shortages in one sector can cascade across multiple industries.
Supply chains and domestic logistics are also vulnerable to disruptions to transport routes caused by climate change, particularly across northern Australia. Seasonal flooding regularly cuts road links and disrupts the movement of food, fuel and essential goods to remote communities and regional centres. As climate volatility increases, building resilience in domestic logistics will become as important as global supply chains.
National resilience cannot be measured solely in defence spending or military capability. It also depends on the stability of supply chains that sustain everyday life. Fuel shortages capture public attention, but shortages of fertilisers, chemicals, pharmaceuticals and manufacturing inputs are just as consequential. The Covid-19 pandemic and the AdBlue crisis showed how supply chains of individual products can quickly become strategic vulnerabilities on a national scale. As geopolitical tensions, logistics disruptions and climate pressures intensify, Australia needs a broader resilience strategy that encompasses the full network of imports, domestic production and infrastructure in every industry.