The rising cost of fuel, driven by the US-Israel conflict with Iran, is threatening Australia's banana supply. Diesel prices have nearly doubled, and jet fuel has doubled globally after Iran blocked the Strait of Hormuz, cutting off about a fifth of the world's oil supply. This has led to increased costs for transporting bananas from farms to markets.
Banana growers are facing higher expenses for fertiliser and fuel, with urea prices rising over 50% in Australia since the war began. The closure of the Strait of Hormuz has blocked about a third of the world's sea trade in fertiliser, including 10 million tonnes of urea, according to the United Nations.
Some banana farmers have paused operations as they cannot afford the increased costs. This reduction in supply is expected to drive up prices for consumers. The situation mirrors that of the fish and chip industry, where rising fuel and fertiliser costs have led to price hikes and supply shortages.
Experts warn that the impact on the banana supply chain will be significant, with potential price increases of up to 10% in the coming months. The combination of higher transport costs and reduced production is likely to affect availability and affordability for Australian households.
