Australia's quiet lifeline amid supply chaos as Indonesia says it will keep sending fertiliser and urea

Indonesia has vowed to keep supplying Australia with fertiliser and urea amid a critical global shortage threatening winter crops due to the war in the Middle East.

Rahmad Pribadi, the head of Indonesia's state-owned fertiliser manufacturer, reportedly had a discussion last week with Australia's ambassador in Jakarta, Rod Brazier, and told him the supply of the crucial materials would continue.

"Food security is a shared responsibility because of our intertwined and interconnected value chain," Mr Pribadi told The Australian.

Usually, Australia sources roughly two-thirds of its fertiliser and urea from Middle East supplies like Saudi Arabia, Qatar and the United Arab Emirates.

But the effective closure of the Strait of Hormuz since the Iran war began in late February has cut that supply off, just as it has deprived the world of 20 per cent of oil shipping.

Indonesia is a major player in the global fertiliser industry and previously came to Australia's rescue with an emergency shipment during Covid, when exports from China, then our main supplier, were restricted.

"It is in Indonesia's interests for Australia to remain a strong agricultural producer and exporter because Indonesia is also dependent on Australia for certain commodities. We are very connected," Mr Pribadi said.

Indonesia gets most of its wheat and meat from Australia, which is also a key sugar supplier to the Southeast Asian country.

"We discussed ways for Pupuk Indonesia to ease the supply tightness of urea for Australian farmers," the official said of his conversation with Mr Brazier.

"I said Australia is one of our key markets and also a friendly state. In times like these, we need friends.

"We definitely know in the next two months Australia will be in need of fertiliser for wheat planting. I am very sure certain quantities of fertiliser will go to Australia."

The chief executive said Indonesia was committed to acting as a "stabiliser" to friendly countries and not letting speculators take control.

"We would like to make clear, not just to Australia but to the world, that we will be a reliable supplier and not let fertiliser be used as a political tool."

Mr Pribadi added that Indonesia only had 1.5 million to 2 million tonnes of fertiliser and urea to export, so it had to be more "selective".

For context, Australia consumed 8.7 million tonnes of fertiliser in 2024, with imports accounting for 7.9 million tonnes.

Manufacturing urea requires large amounts of natural gas, of which Australia has plenty, but domestic gas prices have often made urea more expensive to produce locally compared to importing, leading to the closure of plants.

Urea shortage threatens winter crops

Mr Pribadi's assurances come after farmers warned Australia's food production could be "halved" within months as they battle with soaring fuel and fertiliser costs.

The lack of supply means farmers are having to make a gamble and plant in the current window, not knowing whether there will be enough urea to see their crops through.

Seeds are typically sown with a compound phosphate-based fertiliser to build a strong root base and then, after coming out of the ground at four to five weeks, are refertilised 'in-crop' with urea -- the most crucial step as it boosts yield and determines whether the entire crop is profitable.

National Farmers' Federation president Hamish McIntyre said last month, "we believe we have enough urea on ships and in Australia to secure this winter crop".

"What we don't have is enough to apply in-crop and get set up for summer crops," he said.

"If we can't get our in-crop requirements after May, the winter crop in Australia could be halved."