As Australia’s gas shortage intensifies and gas prices rise, manufacturers are warning of job losses and a fall in business investment.
The Australian reports that regional manufacturers, including the country’s largest tomato producer, Kagome Australia and largest wool processer, Victoria Wool Processors, have warned they will halt investments if prices keep on rising. Both companies have revealed they will face major gas price rises in the new year, up to 100 per cent.
Kagome chief executive Jason Fritsch said the situation became apparent after the company entered negotiations with retailers last year and faced “take or leave it” gas prices, due to critical lack of supply.
“We did not have an option of contracting for a 12-month period; we had to take a two-year period with another price increase next year,” Mr Fritsch said.
“Over the last three years, gas demand has tripled largely due to an increase in export, without an accompanying increase in the supply of gas to meet this additional demand.
“I acknowledge there is complexity around introducing additional supply, but we need our state and federal governments working together to find a way.”
The federal government has urged state governments to remove restrictions on gas extraction and fracking to ease the shortage and dampen prices.