In the morning on 20 March 2006, severe tropical cyclone Larry crossed the Queensland coast in the tropical north, near Innisfail. Between Babinda and Tully, damage to infrastructure and crops was extensive; the total estimated loss exceeded half a billion dollars.

In north-west Queensland, heavy rainfall from the cyclone isolated several townships for a number of days. As a result, food drops were required; emergency supplies had to be delivered by helicopter.

The banana industry in the region was almost wiped out. Around 200,000 tonnes of fruit was lost, worth about $300 million and representing approximately 80 percent of the national banana crop. The storm also destroyed at least $15 million worth of avocados.

The Insurance Council of Australia estimated the 2006 damage at $540 million, with the 2011 estimated normalised cost of $609 million.