{"id":371806,"date":"2026-03-06T23:53:10","date_gmt":"2026-03-06T23:53:10","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/371806\/"},"modified":"2026-03-06T23:53:10","modified_gmt":"2026-03-06T23:53:10","slug":"calls-for-a-national-ethanol-mandate-to-prevent-future-iran-war-style-oil-shocks","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/371806\/","title":{"rendered":"Calls for a national ethanol mandate to prevent future Iran war-style oil shocks"},"content":{"rendered":"

As the war in Iran intensifies, Australia’s sugar industry says a national ethanol mandate could help shield motorists from future market shocks.<\/p>\n

Retail fuel prices surged just days after the conflict started, prompting criticism from peak motoring bodies and catching the attention of the consumer watchdog.<\/p>\n

But as Energy Minister Chris Bowen assured motorists there was no need to panic buy<\/a> the Australian Sugar Manufacturers chief executive Ash Salardini said the vulnerability at the heart of the country’s fuel supplies had been exposed.<\/p>\n

\"A<\/p>\n

Conflict in the Middle East threatens up to 20 per cent of global oil supply. (Reuters: Raheb Homavandi)<\/p>\n

“Australia probably has some of the lowest reserves of liquid fuel in the world,” he said.<\/p>\n

“We have about 30 days of diesel and 30 days of petrol, and similar amounts for aviation fuel as well.”<\/p><\/blockquote>\n

Along with other members of the sugar industry he has called for a national mandate to drive more fuel production at home.<\/p>\n

State of the mandate<\/p>\n

Ethanol is a renewable fuel produced by fermenting biomass, such as waste starch from wheat and grains, or molasses from sugar cane.<\/p>\n

\"Bagasse<\/p>\n

Bagasse from sugarcane can be used to produce bioethanol. (ABC News)<\/p>\n

Currently only New South Wales and Queensland require fuel suppliers to blend it into unleaded petrol or diesel.<\/p>\n

They are also the states home to the two largest ethanol suppliers \u2014 grain producer Manildra Group and Wilmar Sugar and Renewables.<\/p>\n

A national mandate would extend that requirement to retailers in all states and while that would not eliminate Australia’s need to import fuel, Mr Salardini said it would reduce the volume.<\/p>\n

“What that will do is actually increase our [domestic] supply of fuel and reduce our exposure to oil shocks as well,”<\/p><\/blockquote>\n

he said.<\/p>\n

“Ethanol blended into petrol is a way forward for things like sustainable aviation fuel and biodiesel.”<\/p>\n

But not all vehicles are compatible with blended fuels, and mandates face opposition from retailers<\/a>, wholesalers and motorists alike.<\/p>\n

\"A<\/p>\n

The world sugar price could be impacted by the Middle East conflict. (ABC News: Lucy Cooper)<\/p>\n

There is also growing global demand, as companies and governments seek to use ethanol to stem carbon emissions and meet net zero targets.<\/p>\n

Europe has set a minimum supply mandate for sustainable aviation fuels (SAF), and Australia’s own Qantas has set a target for SAF to make up 10 per cent of its total fuel use by 2030.<\/p>\n

Biofuelling up<\/p>\n

Wilmar Sugar and Renewables’ parent company is headquartered in Singapore.<\/p>\n

The tiny nation supplies the bulk of Australia’s liquid fuels, though South Korea, China and Japan are also key sources.<\/p>\n

The company’s distillery at Sarina in North Queensland produces about 60 million litres of bioethanol a year, but even general manager James Wallace said it runs below capacity.<\/p>\n

“We’ve got to look at the economics of our facilities and at the moment it isn’t economical for us to continue to make more ethanol,” he said.<\/p>\n

“With the lack of government support, policy and mandate there is no money in our ethanol production at the moment.”<\/p><\/blockquote>\n

The company sources the molasses for the distillery from its eight sugar mills, like the Invicta Mill at Giru, south of Townsville.<\/p>\n

\"A<\/p>\n

Wilmar Sugar and Renewables is Australia’s largest sugar manufacturer. (Supplied: Wilmar Sugar)<\/p>\n

Operations manager Harrison Slogrove said there was little financial incentive to convert the factories to ethanol production, some of which have been in operation since the 1870s and 1880s.<\/p>\n

“That would be a large investment in the process house of the factory \u2014 switching a large portion of the final product from sugar to ethanol,” he said.<\/p>\n

“The key hurdle of that process is we need a market to sell into.<\/p>\n

“At present we don’t have a clear government mandate to drive domestic demand.”<\/p>\n

Sweet relief<\/p>\n

When NSW introduced its ethanol mandate in 2007, then-prime minister John Howard ruled out taking it national<\/a>.<\/p>\n

Almost two decades later and with a fifth of the world’s oil supply<\/a> stranded in the Strait of Hormuz, Member for Kennedy Bob Katter asked the current prime minister if he would reconsider.<\/p>\n

“Fuel security is really important, and it’s essential as well that we make more things here,” Mr Albanese told parliament.<\/p>\n

“The principle \u2026 that we need to be more resilient and more self-reliant here is not only something that I support in theory, we are putting it in place in practice.”<\/p>\n

Last year the federal government announced it would invest $1.1 billion to accelerate the production of low-carbon liquid fuels in Australia<\/a>.<\/p>\n

\"A<\/p>\n

Australia’s sugar industry has been pushing to expand into biofuel for years. (ABC News: Brad Marsellos)<\/p>\n

Global ethanol prices are largely based off the crude oil market, and the world’s largest sugar supplier, Brazil, is also the world’s largest producer of sugar-derived ethanol.<\/p>\n

It means there is a direct link between oil markets and sugar prices for farmers<\/a> as manufacturers switch between the two.<\/p>\n

Commodities analyst Tom McNeill said sugar prices were currently below the cost of production due to oversupply, but as oil prices rise Brazil would shift to making ethanol instead.<\/p>\n

“If oil prices escalate quickly then we see some flow on to Brazilian energy prices, in particular ethanol” he said.<\/p>\n

“Through that [we see] more support for the sugar price.”<\/p>\n

Mr Salardini said it would take two to three years to build the facilities required for Australia to produce his preferred mandate of a five per cent blend.<\/p>\n

But he said the cost of inaction was “huge”.<\/p>\n

“It doesn’t sound like much, but there is a huge difference between coming short on oil supplies versus not,” he said.<\/p>\n","protected":false},"excerpt":{"rendered":"As the war in Iran intensifies, Australia’s sugar industry says a national ethanol mandate could help shield motorists…\n","protected":false},"author":2,"featured_media":371807,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[174],"tags":[171802,60795,79,179,18,111763,19,17,168834,9331],"class_list":["post-371806","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-bioethanol","tag-biofuel","tag-business","tag-economy","tag-eire","tag-ethanol","tag-ie","tag-ireland","tag-strait-of-hormuz","tag-sugar"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/116184927972388570","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/371806","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=371806"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/371806\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/371807"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=371806"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=371806"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=371806"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}