Crisis after crisis – when do we build greater resilience?

[As published in the Stock Journal]

 Every few years something happens that reminds us just how fragile our supply chains really are. The latest reminder is the escalating conflict in the Middle East. The immediate impacts are already filtering through the system – rising diesel prices, fuel delivery delays, freight surcharges, tightening fertiliser markets and uncertainty in export pathways.

But the bigger question is whether this moment becomes a catalyst for change, or just another warning we ignore. Because if we are honest, none of this should be a surprise.

For years agriculture has operated in a ‘just-in-time globalised system.’ Inputs arrive when needed, supply chains stretch across continents and efficiency has been prioritised over resilience.

It works well – until it doesn’t.

We saw that during the AdBlue shortage in 2021, when a disruption to a single chemical threatened to stop trucks across Australia. The crisis passed quickly, but it exposed how vulnerable our freight system really is.

Then came COVID-19.

Many believed the pandemic would finally push Australia to rethink sovereign capability; whether that be fuel, fertiliser, chemicals or other critical agricultural inputs.

For a moment, it seemed likely. But once supply chains stabilised, the urgency faded. Now we are facing another reminder.

The Strait of Hormuz, through which roughly a fifth of global oil supply moves, has become a geopolitical flashpoint. When tensions rise there, energy markets react quickly. And energy, particularly in the form of liquid fuel, underpins almost every part of agriculture.

For South Australian producers, those global shocks translate directly to the farm gate.

Distance already shapes the economics of livestock production in this state. When diesel prices rise, freight costs quickly escalate. And while Australia’s red meat markets are well diversified, the Middle East still plays an important role, particularly for mutton. The closure of major seaports and airspace leads to stranded cargo, soaring freight costs, and the suspension of trade.

The deeper issue, however, is structural.

Regular readers of this column will know I often raise the point that trade risks continue to rise, and the era of predictable globalisation is fading. Supply chains are becoming more contested, shipping lanes are strategic assets and energy markets are increasingly shaped by geopolitics.

In short, uncertainty is becoming the new operating environment.

Building more resilient supply chains is possible. It might involve larger fuel reserves, domestic fertiliser production, diversified shipping routes or stronger local processing capability.

But resilience is not free. For decades global supply chains were optimised for efficiency precisely because it reduced costs. Which raises the uncomfortable question: who pays for resilience?

Consumers through higher food prices? Governments through strategic investment? Or producers through higher inputs?

What is clear is that hoping the system returns to the stability of the past is not a strategy.

Agriculture has always managed risk – weather, markets and seasons. But the risks emerging beyond the farm gate are becoming larger and more complex.

The real question now is whether we finally act. Or do we wait for the next crisis to remind us again that efficiency without adequate resilience is simply vulnerability by another name.

By Travis Tobin March 2026