Ethanol shortage warnings for drivers

AUSTRALIA'S consumer watchdog has warned motorists to expect a shortage of ethanol supply at service stations as two of the country's three producers, both based in Queensland, remain closed because of the state's devastating floods.

But the Biofuels Association of Australia says the Manildra group, in NSW's central west, is producing more than enough to meet the shortfall and motorists using E10 should not expect an increase in the price of ethanol.

Caltex said it could not guarantee it would be able to supply all its service stations with E10 but Shell said it did not expect the shortage to affect motorists.
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The Australian Competition and Consumer Commission commissioner, Joe Dimasi, said the Queensland floods had affected crops and motorists who used E10 might have trouble sourcing it in coming weeks. He called on fuel retailers to ''take all reasonable steps to ensure that consumers are not misled''.

''The ACCC encourages retailers to be clear in their signage and labelling at their service stations, including on price boards and at the pump, regarding the availability, or lack thereof, of ethanol blended fuel,'' Mr Dimasi said.

Australia's three ethanol producers, Manildra, CSR and Dalby Bio-Refinery, produce about 390 million litres a year.

Industry sources said despite CSR and Dalby being closed as a result of the floods, Manildra had been producing an additional 1 million tonnes of ethanol a week for the past six weeks to meet demand.

The chief executive of the Biofuels Association of Australia, Heather Brodie, said Manildra might actually have to slow production. She said there should be no retailers who were unable to provide ethanol because of the supply shortage.

''The difficulty will be if grain prices go up and ethanol producers are unable to source waste from wheat production,'' she said.

''The current shortage should not affect prices; however, come July when the federal government imposes the excise on ethanol then, yes, that will potentially increase the price at the pump because it will be passed on.''

A Caltex spokesman said the supply shortage was ''a major concern'' for the company.

''The regular grade petrol sold at these sites through the Bio E10 unleaded pumps will be clearly marked to advise customers of this situation,'' he said.

''Bio E10 unleaded may not be available while this shortage of ethanol persists. Customers will be able to purchase regular [unleaded] at these service stations.''

A Shell spokesman, Paul Zennaro, said the company had secured enough supply to meet demand.

source: smh