Will Caltex and Shell allow the LNP to support ethanol?
Queensland canegrowers will lose money this season with sugar prices below the cost of production and growers say two Queensland sugar mills are in danger of closing down while the nation runs out of fuel
Katter’s Australian Party MP and Member for Hill, Shane Knuth, is tabling the Liquid Fuel Supply (Ethanol and Other Biofuels Mandate) Amendment Bill 2026 this week in State Parliament, declaring Queensland can no longer afford to leave its fuel security in the hands of overseas oil companies and weak government policy.
The KAP’s bill comes amid support from major agricultural and manufacturing bodies, including the National Farmers’ Federation, GrainGrowers, Australian Sugar Manufacturers and CANEGROWERS, jointly calling for immediate national ethanol and biodiesel mandates to strengthen Australia’s fuel security.
Mr Knuth said the bill was designed to finally enforce and strengthen Queensland’s failing ethanol and biodiesel mandate, while boosting regional jobs, supporting Australian agriculture and reducing dependence on imported fuel.
Audio: Wilmar Sugar spokesman Mark Greenwood explains the ethanol manufacturing and supply chain throughout Australia:
“Queensland’s current ethanol mandate is a joke. It is weak, full of loopholes, riddled with exemptions and barely enforced,” Mr Knuth said.
“Most people think when they pull up at the bowser and buy E10 they are actually getting 10 per cent ethanol. In most cases they are not even close.
This bill fixes that by ensuring E10 actually contains a minimum of 9 per cent ethanol, introducing enforceable minimum biofuel content requirements and slapping serious penalties on fuel companies that refuse to comply.”
The Bill also requires:
- A minimum 1 per cent ethanol content across all other petrol blends, in line with the national fuel standard; and
- A minimum 2 per cent biodiesel blend in diesel fuel, in line with the national fuel standard.
Mr Knuth said Australia’s fuel vulnerability had been exposed by ongoing instability in the Middle East and global supply chain disruptions, while governments continued to drag their heels on meaningful fuel security reform.
“For decades governments have talked tough about fuel security but done absolutely nothing meaningful when it comes to enforcing biofuel mandates,” Mr Knuth said.
“The major oil companies have had governments exactly where they want them – at their beck and call with weak biofuel mandates, weak enforcement and endless exemptions.
“Meanwhile countries like Brazil, India, the United States and across Europe are massively increasing ethanol use because they understand it strengthens fuel security, supports farmers and keeps more money in their own economy.”
“Australia imports around 90 per cent of its refined fuel and every international crisis sends prices through the roof while families and businesses get smashed at the bowser,” he said.
“The rest of the world is moving aggressively to strengthen domestic fuel production through ethanol and biofuel mandates while we have to ship our own ethanol and biofuel to overseas markets.”
Knuth added the Queensland State Government has largely ignored Ethanol and biofuels as a solution to fuel security;
“The State Government talks about the Taroom Trough as the salvation calling on an Albanese led Labor government to make this happen, knowing full well the Feds would avoid this like the plague.
“It’s a smokescreen purely designed to get a media headline.
“Meanwhile, we have an immediate solution in ethanol and biofuel, which is being ignored.”
KAP Leader and Member for Traeger, Robbie Katter, said the Bill exposed years of political weakness from both major parties pointing to recent reports showing Australia exported more than 150 million litres of ethanol last year, while simultaneously importing refined fuel from overseas.
“It is absolute madness that ships carrying Australian made ethanol are leaving our ports while fuel tankers carrying imported petrol pass them on the way back in,” he said.
“We export our sugar, grain, ethanol, biodiesel, tallow and canola overseas so other countries can strengthen their fuel security, while Australia becomes more dependent on foreign oil giants every year.”
Mr Katter said Queensland should be leading the nation, not falling behind.
“The LNP has submitted Ethanol Madate Bills in the past, when in opposition, so now that they are in Government their support should be automatic.
We grow the feedstock. We have the cane industry. We have the grain industry. We have the processing capability. What is lacking is political courage,” he said.
“This could become a multi-billion-dollar industry supporting regional Queensland jobs and reducing Australia’s exposure to overseas fuel shocks.”
Mr Knuth said the State Government now had a choice.
“They can keep protecting multinational oil companies or they can back regional jobs, Queensland agriculture and manufacturing and provide real fuel security by supporting this Bill.
The time for smokescreens and excuses is over.”