Food supply in tax crisis
AUSTRALIA'S vital fresh food industry is in crisis, after a massive jump in the cost of essential refrigerant gases.
Carbon tax-linked price rises, up to 400% this week, have sent shockwaves through food supply networks, from fishing boat and farm gate to shop, home and export market.
Dairy farmers, meat processors, fishers, transport operators, exporters and domestic retailers will all be trying to pass on maintenance and purchase cost increases for their fridges.
Dairy farmer John Cochrane said he had recently sold a milk vat with 30 litres of refrigerant. "The gas costs $8000 to replace," he said.
Gympie Cooloola Food Service's Charlie Horne says he will be switching to carbon dioxide refrigeration.
Refrigeration and air conditioning provider Gary Albrecht said gas had now become so precious "some say we'll have to keep it under lock and key in case people want to steal it."
THE fridge gas replacement that saved us from destroying the ozone layer has now been targeted for its effect on global warming.
Claimed carbon tax effects have this week seen price increases of about 300% for Australia's most commonly used refrigerant gas, a product called R404A.
The Federal Government, however, questions the carbon tax link, saying the carbon price effect should be only $75.
But according to one industry price this week, the increase is more like $280 a kilogram.
Out of the frying pan and into the fire, Australia's long-distance food supply networks depend heavily on refrigeration. And they almost all depend on expensive equipment designed to use R404A.
The gas was introduced in the mid-1990s to fill an urgent gap when ozone depleting CFCs were withdrawn from the market.
Critics say the gas has a high "global warming potential".
It also has been described as less efficient, therefore requiring more coal-fired electricity to do its job.
Mr Cochrane says dairy farmers would not be able to pass on the potentially crippling costs of re-gassing equipment, at $8000 a vat.
"How is a farmer faced with that cost going to pass it on?" he asked.
"People are just screwed down so tight now, they haven't got the spare cash (to switch to alternatives)."
One fishing operator claimed that a leak from damage to one of his four on-board refrigerators would cost him $16,000 if he had to re-gas.
Mr Horne said he would soon be installing CO2-based refrigeration, a greenhouse neutral gas in this case because it is obtained from the air and can only leak back there.
It would require larger equipment to operate, he said.
Industry leaders at all stages of the food supply chain were at a loss to explain the increases yesterday.
One gave an example of a farm with a coolroom containing what was $4500 worth of gas.
It would now cost close to $20,000 to replace," he said.