At the beginning of this year, experts warned the price of diesel exhaust fluid (DEF) would rise steeply in the coming months. Those fears have been realized as the price of DEF has risen from about 60 cents a gallon in January to $1.59 a gallon most recently, representing a 12-month jump of 162%.
The reason for the exorbitant price hike is that the main ingredient of DEF, urea, is currently in short supply. Urea (yes, the stuff in urine) is an important agricultural fertilizer that also happens to make up about one-third of the ingredients in DEF.
Not only is the shortage of urea hurting truckers, but it is also a culprit in rising food prices as farmers struggle to fertilize their fields.
The urea used for DEF and fertilizer is made from a process using either natural gas or coal to produce ammonia which is turned into synthetic urea.
As the world struggles with climate change, many coal-fired power plants have been closed and the price of natural gas has risen since the outset of the pandemic. Natural gas prices have skyrocketed across the globe and have doubled in the U.S.
Two of the biggest suppliers of urea, China and Russia, have limited their exports so their farmers are not caught in short supply of the fertilizer. In addition, Hurricane Ida, which hit the U.S. southern coast in August, forced chemical plant closures.
DEF is used to treat exhaust gases and its use was mandated by the Environmental Protection Agency more than ten years ago. Experts predict that the price of DEF may climb even higher before dropping. Another bit of bad news is that as the price of DEF rises, demand will continue to grow.
