Fuel Levy Updates and Communication to Customers

The unprecedented sudden rise in fuel costs in Australia, especially diesel, has impacted freight significantly. There are high value, high margin goods where the freight costs can be easily absorbed without unduly impacting profitability. In the agricultural ingredient supply chain, margins are typically very low and the distances often travelled are significant.

The use of freight inclusive (FIS) prices as the dominant pricing approach means that either price lists are routinely updated or a separate charge to cover the extraordinary rise in the fuel levy is taken. On some goods the additional charge to other states significantly exceeds the margin on the goods.

TFB Trading has chosen to separate out the recovery of this additional freight charge for two reasons:

1) To avoid sending out a new price list each week and keep our monthly cycle
2) To avoid locking in higher prices if we get price relief

What’s Driving It: Diesel Prices

The national average diesel price has climbed steadily through March 2026. The chart below breaks down the AIP five-city average into its components: base fuel cost, excise, the heavy vehicle infrastructure charge (HVIC), and GST.

National Diesel Price (cents/litre)

The base fuel cost is doing most of the work. Excise and HVIC are fixed charges, so when the underlying fuel price moves, the levy percentage applied by freight carriers moves with it.

Freight Cost by Destination

Each chart below shows how total freight cost per tonne has escalated across the four fortnightly levy adjustment periods. The green section is the base freight rate. The amber-to-red sections are the fuel levy surcharge, growing darker as the levy increases.

Brisbane (base $226/t)

Brisbane has seen the levy climb from 28% to nearly 60% of the base rate, adding $71 per tonne in a single month.

Perth (base $372/t)

Perth carries the highest absolute freight cost but the levy increase has been more moderate, capping at 40% on the last two adjustments.

Sydney (base $143/t)

Adelaide (base $130/t)

Sydney and Adelaide have tracked the same levy escalation as Brisbane: 28% to 59.2% across the four periods.

Melbourne (base $42/t)

Melbourne local deliveries are currently exempt from the surcharge. The rates shown are the carrier’s published schedule for reference only.

Bean Growers Australia: Fuel Levy Surcharge

For comparison, Bean Growers Australia has applied an extraordinary fuel levy surcharge on their freight-inclusive pricing. Their figures represent the surcharge component only, ex GST.

BGA Extraordinary Fuel Levy Surcharge ($)

What This Means

If you’re buying ingredients on a delivered basis, the freight component of your landed cost has increased materially this month. On a Brisbane delivery, the levy alone has added over $70 per tonne since end of February.

The levies are reviewed fortnightly. If diesel prices ease, the surcharges should follow, but there’s typically a lag. We’ll update this post if there’s a material change.

TFB Trading freight costs are per tonne ($/t), rounded to the nearest whole dollar. Fuel levy % is applied to the base freight rate and reviewed fortnightly. Bean Growers Australia figures represent the extraordinary fuel levy surcharge on freight-inclusive pricing, ex GST. Contact TFB Trading for your specific account rates.