Here's my answer to the challenge:
March-June 2005: Vanuatu imposes ban on imported biscuits. Fiji responds with a total embargo of all Vanuatu goods.(First two items happened in OTL) Tensions continue to rise as neither side will lift their embargo.
July 2005: Fiji declares that if Vanuatu does not lift the ban, military action will have to be taken. Fiji recalls its peacekeepers from UN missions. On July 30, Fiji declares war on Vanuatu.
August 2005: Australia declares that Fiji's actions are unlawful, and gives Fiji 48 hrs to end military action before Australia intervenes. Fiji continues with the military course, and Australia declares war on Fiji on August 7. Fiji prepares defenses of the islands, and large amounts of the male population are drafted into the military.
October 2005: As both sides gear up for war, Australia is hit by a surprise attack. Fijian commandos hidden on merchant ships sail to Norfolk island and take it by surprise. Key installations are blown up by the commandos, and large amounts fo supplies are taken. Australians are shocked by this, and the government immediatly orders Fiji to be bombed. Australian aircraft begin to hit military targets all over Fiji.
November 2005: An Australian Naval Task Force sets out for Fiji. Australian Special Forces paradrop onto Norfolk Island and retake it after a brisk fight. Australian F/A-18s sink most of the Fijian navy through precision airstrikes. Australian troops begin to land on Viti Levu on November 25. Regulars of the Fijian Army have been dug in at the beaches, and there is hard fighting around the beaches. Airstrikes eventually dislodge the Fijians, and they begin to retreat towards Suva.
December 2005: Australian forces fight there way into Suva. Snipers are hidden in many buildings, and the fighting goes street by street. A second task force lands on Vanua Levu at the same time. After 1 day of fighting, Fijian forces on Vanua Levu surrender. A day later, Suva surrenders and Fijian resistance ends.
January 2006: A peace treaty is signed. The terms are not overly harsh, but Australian forces are permitted to be based on the island to protect the democratic government which was deposed during the war. Vanuatu is allowed to keep their ban on biscuit imports.