In Brief
On 1 September Australia held 33 days of diesel, less than five weeks of normal use. It imports most of its fuel, fertiliser and plastics. Government has begun to pay for resilience, but its support is uneven and can be cut in a single budget. Boards should find the handful of imported inputs that could stop revenue, pay for cover deliberately through procurement, and count a grant only once the business case works without it.
The fuel buffer runs to weeks, and the system has been tested before
In December 2021, service stations in parts of Australia started rationing an obscure diesel additive.
It was AdBlue. Diesel engines fitted with a particular kind of emissions control need it, and it is made from urea. China’s restrictions on urea exports contributed to the shortage. The freight industry warned of disruption, and the government moved to secure and subsidise extra production at home through Incitec Pivot.
Six months later, on 15 June 2022, the Australian Energy Market Operator suspended the wholesale electricity market across the eastern and southern states. Generator outages and coal and gas supply constraints, among other pressures, had left it unable to run normally.
What that cost any one business depended on its contracts and hedges. That is the pattern. Government sets the national buffer, and each company sets its own exposure to it.
of diesel held in Australia on 1 September 2026, less than five weeks of normal use. Petrol stood at 43 days and jet fuel at 33.
Australian Government Fuel Plan, fuel statistics, minimum stockholding obligation measure, 1 September 2026
The buffer is still thin. Trucks, mine fleets and harvesters run on diesel, and an interruption longer than that would test whatever a business and its suppliers hold.
Canberra has noticed. In May 2026 the government announced a fuel and fertiliser security package, and in August it opened consultation on a larger reserve. Those settings are still proposals.
The exposure looks different in each company. A logistics operator reads it as depot stocks of diesel and AdBlue. A food processor could meet it later, as fertiliser costs flow through to what growers charge. For a manufacturer, the input that stops the line may be nothing grander than imported packaging resin.
Which input is it for yours?
Four channels of dependence, and support that can be cut
Import dependence reaches a company through four channels: fuel, the chemistry behind farm output, industrial basics and shipping. The chart shows how far imports reach into the first three.
Fuel is the deepest exposure. Australia has two major refineries left, at Geelong and Lytton. Together they supply around one-fifth of the country’s fuel needs. Roughly four litres in every five arrive by ship, already refined.
Farm output rests on imported chemistry. CSIRO estimated in 2025 that Australian food production feeds around 100 million people, more than three and a half times the country’s population.
Behind that surplus sits imported fertiliser. On CBA’s estimates for 2019 to 2023, imports supplied all of the potash, 87 per cent of the nitrogen fertiliser and 68 per cent of the phosphate. The paddock is sovereign; the chemistry underneath it is not.
The dependence outlasted the AdBlue scare. A year later, in December 2022, Brisbane’s Gibson Island plant stopped making fertiliser from gas. The next large domestic urea plant, near Karratha, is not due until 2027. Supply eased again in August 2026. The dependence has not.
Industrial basics follow the same pattern. ARENA estimated in 2024 that Australia makes only about 1 per cent of its solar panels. The Australian Council of Recycling puts the imported share of plastic, as resin or finished goods, at around 90 per cent.
Shipping is the quietest dependency. Almost everything above arrives by sea, mostly on foreign ships, so a shipping disruption can affect several channels at once. The government plans a strategic fleet of up to 12 Australian-flagged vessels; in May 2026 it secured the first, ANL Kokoda.
Government has started to pay part of the premium. Future Made in Australia, announced in the 2024-25 Budget, commits $22.7 billion over ten years: about $2.3 billion a year, spread across every eligible industry.
Some of it is in legislation. Tax incentives for hydrogen and critical minerals run from July 2027 to June 2040, subject to eligibility and time limits. Grant programmes are set budget by budget, and they can change faster than a plant gets built.
The Battery Breakthrough Initiative launched with $500 million. The 2026 Federal Budget cut it to about $142 million, leaving 28 cents of each original dollar, and ARENA stopped taking new applications.
Solar Sunshot, launched under the same banner, keeps up to $1 billion.
A programme that can shrink by more than 70 per cent in a single budget cannot underwrite a board’s resilience strategy. Co-investment improves the economics of onshore capacity that already makes commercial sense. A fragile business case stays fragile with a grant attached.
That leaves the board to decide where the company pays for resilience itself.
Find the inputs that could stop revenue, then buy cover on purpose
The board cannot fix the national buffer. It can know which inputs the company cannot run without, and decide what cover to buy.
Acting costs a premium now: a second supplier, more stock, an onshore contract. Not acting leaves the company exposed to lost revenue in the next disruption, for as long as it lasts.
Scope the audit to what could stop revenue within 90 days. Ask management to trace each such input to its country of origin, including concentration hidden inside a supplier panel that looks diversified. Then count the days of cover held by the business, its suppliers and the nation.
Keep the list to a dozen inputs or fewer, so the board can act on each one. Look for the specific, unglamorous input.
Weight resilience in procurement, in writing. Buying on lowest landed cost can concentrate supply in one origin, one contract at a time. Set a stated weighting for origin diversity and days of cover in every sourcing decision for a critical input, and report exceptions to the board.
The remedies are familiar: a second supplier in another country, buffer stock, an onshore contract or a redesigned product.
Position for co-investment without depending on it. Where a federal or state programme matches an exposure, engage early. Model every business case at zero programme funding first, and treat the grant as margin. Public money should speed up a decision the company has already justified, never rescue one it has not.
Pricing the sovereignty premium deliberately
| Action | Owner | Timeline | Priority |
|---|---|---|---|
| Commission a critical-input audit of inputs that could stop revenue within 90 days: origin, concentration, days of cover and substitution cost | COO with the chief risk officer | Commission at the next board meeting; report within one quarter | critical |
| Add origin-diversity and days-of-cover weightings to procurement policy for critical inputs, with exceptions reported to the board | Chief procurement officer | Within six months | high |
| Screen structural exposures against federal and state programmes, with every business case modelled at zero funding first | CFO | Before the next capital plan | high |
| Record import dependence on the risk register with a named owner and a dollar estimate | Audit and risk committee | When the audit reports | high |
National buffers move on political timelines. A company’s exposure moves on its own procurement calendar, and that is the one the board controls. The next decision: commission the audit at the next board meeting, with the COO accountable.
Due within one quarter: the imported inputs that could stop revenue, each with its origin, its days of cover and an executive who owns it.
Updated September 2026: figures refreshed and the argument sharpened since first publication on 24 June 2026.
Questions for Leadership
Which imported inputs could stop our revenue, and how many days of cover do we hold against each?
The national stock figure says nothing about what we, or our suppliers, actually hold.
What would a six-week interruption to diesel, chemicals or packaging do to our operations, and to the suppliers we depend on?
A supplier's shortage becomes our shortage, and their stock is not on our balance sheet.
Where does our procurement pay for resilience, and where do we still buy on landed cost alone?
If resilience carries no weight in a tender, its cost is not avoided, only paid later in a disruption.
Which government programmes does our strategy assume, and does the plan still work without them?
Grant settings can change at any federal budget, whatever our capital plan assumes.
Who owns import-dependence risk on our register, and does it carry a dollar figure?
A risk with no owner and no number cannot be weighed against projects that have both.
The Bottom Line
Treat import dependence as an operating risk with a price. Commission a short audit of the inputs that could stop revenue, write origin diversity and days of cover into procurement, and count government co-investment only after the business case works at zero funding.
Frequently Asked Questions
How do the stock-day figures compare with Australia's international obligation?
Not directly. The days quoted here use Australia's own minimum stockholding measure, which also counts crude oil held for refining and fuel held in Australian waters. The International Energy Agency obligation is different: 90 days of the previous year's average daily net oil imports. On that measure Australia averaged about 50 days in 2024-25, according to the energy department. The government has also temporarily lowered the petrol and diesel stock that importers and refiners must hold, until 30 September 2026. Boards should read the figures as a direction and ask management to check the latest release.
What has the government proposed for fuel security, and is any of it law yet?
On 6 May 2026 the government announced a fuel and fertiliser security package. On 18 August the energy department opened consultation, closing on 15 September, on three proposals: a one-billion-litre fuel reserve, ten additional days of minimum stock, and support for refining beyond 2030. None of the three is law yet, and the final settings may differ. None would change a company's own contracts, stock or supplier concentration. A board that waits for the final settings before mapping its exposure will still have to do the mapping afterwards.
How much should a critical-input audit cost?
It depends on scope, so the board should ask for a fixed-scope quote rather than accept a rule of thumb. The cost drivers are the number of inputs in scope, the number of suppliers that must be traced beyond the first tier, and the quality of existing procurement data. Put the quote beside management's estimate of the revenue lost in one week of interruption, and decide with both numbers on the table. Scope is the main control: an audit limited to inputs that could stop revenue is a project, while an audit of every input is a programme.
What if suppliers will not disclose where their inputs come from?
Treat refusal as information. A supplier that cannot or will not show where its critical inputs originate is asking the company to carry concentration risk blind, so the audit should record that exposure at its worst plausible case. Then use the contract. Write origin disclosure and early notice of supply problems into renewals, give weight in tenders to suppliers who can evidence their chains, and arrange a second source around those who cannot. The suppliers that still refuse are showing the board which relationships need a priced alternative.
Does sourcing from allied countries solve the problem?
It reduces one risk. Buying from a politically aligned country lowers the chance of restrictions imposed for political reasons. It does not stop any country protecting its own supply, which is what China did with urea in 2021. It does not remove dependence on foreign shipping, a supplier's own reliance on a single origin further up the chain, or a price shock that hits every source at once. Treat it as one option, priced case by case beside a second supplier, buffer stock, an onshore contract or a product redesign.