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Comment by donavanm | Hacker News Reader

> if you're in the UK, Middle East, Australia (food is about to become more expensive & tricky)

Australias not in a terrible position. We produce ~50% of our NPK fertilizers used, and this is down primarily because were importing more from places with cheaper/distant environmental impact. Conversely, IIRC, UK and Ineos just shut down their significant last fertilizer plant and the north sea fields is its own thing.

Similarly we have suitable local gas supply for the needed feedstock. And you can see the govt already starting to restrict (“reserve”) exports. Which, of course, will contribute to the global problem.

AU as a whole is a commodity and food exporter. Of course global commodity squeezes make Everyone poorer, I believe ricardo. I dont see our local position being anywhere as fragile as europe and me, unless Im missing something.

But I dont see AU being anywhere near as fragile as Sri Lanka circa 2022-23.

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We are vulnerable in Australia though because we have to move food large distances from farms to cities and are unusually road-dependent for those kind of distances (most countries use much more freight rail). Large diesel price rises are going to be extremely painful for us.

And electricity and manufacturing too, since we have no real gas reservation policy and the exporters were allowed to build enough capacity to export basically every single joule of gas that we produce (and they pay a fraction of the royalties that countries like Qatar rake in). So locals and local businesses pay very high prices so the gas companies can export most of our supply overseas...

Diesel price rising can be easily fixed though.

The Government collects 51.6 cents per litre on Fuel and Diesel, they'd need to just temporarily cut back on some of their obscene fuel margins to keep everything within steady-state.

The question is, will the Government do so?

But what if there's not enough diesel?

That's what at stake here, with oil exports from the Middle East dwindling... Oil price might not even go up that much, or for that long, if the economy crashes hard enough.

The Australians are currently pointing to diesel reserves or on hand in the farms is quite low, suggesting that mechanised cropping/transport of farm products is going to provide a pinch point.

I have no idea if the reports are accurate, or an attempt to put the market into readiness for inflation.

edit: Whether real or imagined, there is panic buying of petrol happening - this could lead to supply issues by itself.

https://www.reddit.com/r/australia/comments/1rohwzl/fuel_pan...

As someone who has done physical work at the sites of Australian diesel reserves, they aren't designed to last that long.

I do still feel we're better off than most. We can actually offset the price of fuel by reducing the government excise, and even subsidising it. We've done it before. 2 gulf wars, a global oil crisis, general middle east chaos? Australia has typically done better than most.

Would still be good if we had an actual sovereign mineral fund and hadn't sold our gas rights to everyone else, but I suppose we have to live with the stupid shit the previous governments have done.

The cynic in me thinks we will be squeezed anyway because [name redacted] leaders apparently love to sell off everything to the global market with little concern for the residents. Why squeeze just domestic or just global when you can do both and collect even more profit?

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