Fizzled Out: Australia’s Soft Drink Shortage Due to CO2 Crunch

Australian supermarkets are facing a notable shortage of soft drinks, leaving shelves surprisingly empty. The root of the issue? A significant shortage of carbon dioxide (CO2) on the east coast! This shortage stems from local supply disruptions and complications in international freight for CO2 imports, leaving the duration of this shortage uncertain.

Customers have noticed the empty spaces where their favorite fizzy drinks usually sit, with major retailers Coles and Woolworths confirming the shortage. Both have been affected but are offering alternative products to mitigate the impact on consumers. 

Air Liquide, a producer of industrial gases, including CO2, attributed their supply challenges to a planned maintenance shutdown, although efforts have been made to minimize customer impact. Meanwhile, BOC has prioritized CO2 for critical uses like medical and water treatment and is working on a new CO2 processing facility in Victoria, expected to alleviate some of these pressures by the second half of 2024.

This real-world scenario illustrates the fragility of supply chains and the broad impact of resource shortages, even on everyday items like soft drinks. Understanding how supply and demand, as well as external factors like maintenance and freight issues, can affect product availability offers valuable insights into the complexities of modern economies.

THINK LIKE AN ECONOMIST!

Q1. Define the term scarcity.

Q2. Explain how a shortage of CO2 can impact a firm’s production costs. 

Q3. Analyse the potential effects of the CO2 shortage on the market for fizzy drinks.

Q4. Discuss how this shortage of CO2 highlights the drawbacks of international trade.

Click here for the source article

TheCuriousEconomist

Recent Posts

France Targets the Wealthy with New Tax Hikes to Tackle Deficit

In a bid to save €60 billion in 2025, the French government has unveiled a…

4 days ago

China’s Exports Surge as Global Demand Remains Strong, But Trade Tensions Loom

China’s exports surged by 12.7% in October, marking the fastest growth in over two years…

1 week ago

VW Boosts Rivian Joint Venture with an extra $5.8 Billion

Volkswagen Group is betting big on its electric future with Rivian. The automaker has raised…

1 week ago

American Brands are Feeling the Squeeze as Sales Drop in China

U.S. consumer giants are finding China a challenging market as slowing consumer spending and strong…

3 weeks ago

Russia Slaps Google with an Unpayable Fine for Blocking State Media

In one of the largest fines ever imposed on a company, a Russian court has…

3 weeks ago

China Slashes Tariffs for Developing Nations

Starting December, China will cut tariffs for goods from 43 of the world’s least developed…

3 weeks ago