25 May 2026
Fuel Levy Update – May 25th 2026
The unprecedented rise in fuel costs has impacted freight significantly since late February. With margins thin and distances long in the agricultural ingredient supply chain, TFB Trading has chosen to separate out the fuel levy surcharge rather than rebuild base pricing every fortnight. This week, with carrier rates ticking up for the first time in six weeks, TFB has chosen to continue absorbing the levy entirely for Sydney, Adelaide and Melbourne customers. Brisbane has moved up to $22/pallet (from $19) and Perth has held flat at $57/pallet — both passed through to invoices as normal. The reversal aligns with a small uptick in terminal gate diesel prices and renewed pressure in the Strait of Hormuz.
25 May update — first uptick in six weeks, but TFB still absorbing three routes. Carrier-published levy rates for Brisbane, Sydney and Adelaide have ticked up from 36.56% to 37.65% — modest, but the first rise since early April. Sydney ($14) and Adelaide ($13) carrier surcharges remain absorbed by TFB; Melbourne (34%, $4) likewise. Brisbane has lifted from $19 to $22/pallet and Perth holds flat at $57/pallet — both passed through. The uptick aligns with diesel terminal gate prices nudging up mid-week (Adelaide TGP rose 206.6→209.3¢/L between 19 and 20 May) and renewed pressure in the Strait of Hormuz.
The trend at a glance
Twelve fortnightly periods of carrier-published fuel levy rates, charted below. Brisbane, Sydney and Adelaide share the same carrier schedule (so they sit on the same line); Perth has its own. Note: Sydney and Adelaide carriers now publish a 37.65% levy rate this week, up slightly from 36.56% — but TFB continues to absorb that cost rather than pass it through, so these customer invoices show $0 surcharge. Brisbane and Perth surcharges continue to flow through to invoices as normal.
Bean Growers Australia — for comparison
BGA’s extraordinary fuel levy surcharge has moved in the opposite direction to TFB’s carrier rates this week — down approximately 10–12% across all four destinations versus the 18 May edition. The two systems are diverging slightly: TFB carriers nudged up while BGA fell back. BGA applies the surcharge to freight-inclusive pricing rather than to a separate base freight component, so the absolute dollar figures sit higher than the TFB pass-through.
Medium-term risks that aren’t in today’s prices
The current carrier review settings reflect today’s terminal gate diesel prices, not what is coming. Three specific risks are visible on the calendar and in the supply chain but are not priced into the current levy:
⚠️ The risks visible from here
- 30 June excise cliff (5 weeks away). Federal fuel excise relief (26.3¢/L) and the zero HVIC concession both expire on 30 June. Energy Minister Chris Bowen confirmed this week that the cut was always viewed as temporary, while the PM declined to rule out an extension. Without one, retail diesel steps up roughly 26¢/L overnight on 1 July — about a 10% wholesale jump that flows into freight levies within a fortnight.
- European summer demand spike (June–August). Asian refineries that supply Australia (Singapore, South Korea, Malaysia) face tightening margins as European driving season kicks in. AIP CEO Malcolm Roberts flagged earlier in the month that these refineries are sourcing more crude from Canada and the US to compensate for Middle East disruption.
- Strait of Hormuz — limited traffic resuming. Tanker movement is restarting on a controlled basis under Iranian-imposed permitting. The VLCC Eagle Verona, stranded since 26 February with 2 million barrels of Iraqi Basrah crude for China, finally exited last week. Five of seven Malaysia-permitted ships have now cleared. But volumes remain far below pre-war norms, war-risk insurance is still ~8× pre-crisis, and Brent has only retraced to ~US$103/bbl on US-Iran diplomatic hopes — still roughly 50% above pre-war levels.
The 30 June cliff in particular is a known event that will move levy percentages back up within one or two fortnightly reviews after 1 July unless extended. The EIA’s May Short-Term Energy Outlook expects Brent to fall to ~US$89/bbl by Q4 2026 and US$79 in 2027 — but that path is highly contingent on the diplomatic track holding.
This week’s sources
- ACCC weekly fuel price monitoring update, 22 May 2026 (link)
- WhichCar — “Fuel excise cut unlikely to continue beyond June”, 23 May 2026 (link)
- Gulf News — “Is Strait of Hormuz now open? More oil, LNG tankers cross Gulf chokepoint”, 25 May 2026 (link)
- US EIA Short-Term Energy Outlook, 20 May 2026 (link) · Trading Economics Brent crude, 22 May 2026 (link)
- BP Terminal Gate Pricing, 23 May 2026 (link) · AIP TGP data, 22 May 2026 (link)
TFB Trading freight costs are per pallet, 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, plus GST, as published by BGA. Contact TFB Trading for your specific account rates.