WEA gone by new year

The Bill was stalled in the second half of the year due to efforts by industry, with Coalition support, to retain and expand the market oversight functions of regulatory watchdog Wheat Exports Australia (WEA).

But its successful passage through parliament now meets federal Agriculture Minister Joe Ludwig’s revised schedule to conclude the vexed issue during the final sitting week of parliament for 2012.

Speaking after the Bill passed the Senate late yesterday, Minister Ludwig said Australia’s wheat industry will now be fully deregulated. The legislation was returned to the House of Representatives with the amendments added in the Senate and passed through.

WEA will wind up its operations on January 1, 2013.

Minister Ludwig said the WEA with its Wheat Export Accreditation Scheme and 22 cents a tonne Wheat Export Charge were all measures put in place to aid industry’s transition away from the AWB’s single desk, but “will be abolished and bulk wheat exports fully deregulated”.

He said the Bill removes unnecessary red tape and promotes competition within the wheat industry.

“A fully deregulated market means wheat exporters can sell their product to who they want, when they want, ensuring the best price for their wheat in the market,” he said.

“Deregulation has been a long time coming. It’s great to see that the wheat industry will finally achieve it.”

The Gillard government agreed to amendments that will see the formation of a wheat export industry taskforce to examine wheat export standards and the reporting of up country stocks information. A code of conduct for port access will also be made mandatory.

Minister Ludwig said the amendments supported the government’s view that industry should drive the development of industry-good functions, and bulk handlers, exporters and growers should now work together to move the industry forward.

The government will form a taskforce to examine current arrangements along the supply chain and provide recommendations on the appropriate use of surplus funds from the Wheat Export Charge, he said.

“That taskforce will provide a new process for industry to work together in a deregulated market into the future,” he said.

“Industry will be consulted on taskforce membership and Terms of Reference, and on the port access code, prior to them being finalised.”

The Bill’s passage was marred by extreme division amongst grain grower groups, with east coast producers lobbying to expand and extend WEA’s operations, amid concerns the markets was not yet mature enough to deregulate.

But Western Australian grower groups and bulk grain handler CBH supported the government’s bid to deregulate the market, as recommended by the Productivity Commission’s report, saying the bureaucracy was costing growers about $2 million per year but no longer providing returns.

The Coalition became bitterly divided on the issue, with WA Liberal MPs and Senators urged to back their WA constituents and vote against a move that was seen to appease east coast Nationals and some Liberals.

A number of WA politicians pledged to cross the floor and vote with the government, including WA Nationals MP Tony Crook, and Liberal Senators Alan Eggleston and Dean Smith.

However, the deadlock was broken by the Australian Greens moving amendments in the Senate, which the government supported.

Greens WA Senator and agriculture spokesperson Rachel Siewert said the Bill’s passing through the senate was “a big win for farmers around the country”.

“A significant amount of work has been done by the Greens on this issue and I am glad that we’ve managed to get a good result for growers across Australia,” she said.

“Through our negotiations we have been able to deliver this Bill through the Parliament with amendments that strengthen measures to ensure that monopolies don’t shut exporters out of ports and establish and advisory taskforce to examine some of the on-going problems for the sector.

“We have also listened to many wheat growers who have been asking that there be better oversight of the quality of wheat exported and better access to important trade data to allow wheat farmers to compete fairly.”

The loudest supporter of deregulation - and biggest critic of the Coalition’s ambiguity - was the WA Pastoralists and Graziers Association (PGA).

As expected, PGA Western Grain Growers chairman John Snooke praised the Bill’s passing yesterday, calling it “a tremendous result not only for export wheat growers in WA but for all grain growers in Australia”.

“The PGA and supporters of the government’s Bill have continually said that the industry is mature enough for full deregulation and that any industry good functions are best addressed by industry, not through increasing the role of WEA, or imposing further regulation or costs on growers.”

But NSW Nationals Senator and wheat farmer Fiona Nash remained opposed to the end, declaring in her Senate speech that she had not changed her position “one bit” from 2008 when the monopoly on wheat exports was removed.

“I thought that getting rid of the single desk for wheat was singularly one of the most stupid things a government has ever done in this nation,” she said.

“I have seen nothing in the last four years to change my view on that.

“Four years ago we could see exactly what was going to happen, that we would end up with regional monopolies in place of a single monopoly that served wheat growers very well, replaced with regional monopolies whose instincts at heart are to serve their own interests.

“I excuse CBH from that in that they do operate on the notion of returning to growers.”

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