Australia's Wesfarmers hikes retail prices as war-hit freight costs rise

Wesfarmers

05/05/2026 02:49

By Christine Chen

SYDNEY, May 5 (Reuters) - Wesfarmers WES.AX, Australia's biggest non-food retailer, said on Tuesday it was raising some of its product prices as it faced higher freight and fuel costs due to the Iran war.

The Perth-based conglomerate, which owns hardware chain Bunnings and discount retailer Kmart, said fuel surcharges imposed by international container shipping companies and domestic transport providers were having "the biggest impact" on costs.

"Obviously when cost prices are going up, some prices are going to have to go up," CEO Rob Scott said at the Macquarie Australia Conference in Sydney.

"There will be some costs that do need to flow through, like obviously transport costs, fuel costs are having an impact on supply chains."

As a result, products made with petrochemical inputs, including PVC pipes and other building supplies, were likely to become more expensive.

"Some of the products, particularly in the building products area - whether it's PVC pipe or other products where petrochemicals are an input - you will see costs go up in those areas," Scott said.

"But what we are able to do across our businesses is to try and keep our prices as low as we can through leveraging our low-cost operating model."

Wesfarmers' lithium mining operations have also faced some cost pressure from higher diesel prices, though Scott said fuel represented only a "pretty small component" of overall operating expenses.

Scott added that fertiliser prices had also been affected by the conflict, but Wesfarmers had benefitted from the government underwriting purchases, allowing it to secure urea shipments despite price volatility.

 (Reporting by Christine Chen in Sydney; Editing by Sonali Paul)

 ((christine.chen@thomsonreuters.com; +61 2 9171 7119;))