GRAIN grower lobby groups have expressed delight at the Australian Competition and Consumer Commission (ACCC) response to a Department of Agriculture review into the nation’s Port Access Code for wheat.
The Port Access Code currently applies to access to ports operated by GrainCorp, Viterra and CBH, the nation’s big three in terms of grain bulk handling and the owners of the vast majority of the country’s grain exporting ports.
The ACCC has made some strong recommendations to the Department, including widening the code to apply to all grain exports and the implementation of baseline regulatory requirements for access to upcountry networks.
The ACCC response was broadly in line with the stance taken by the production sector.
Andrew Weidemann, chairman of Grain Producers Australia (GPA) said it was good to see the ACCC involved in issues such as port access.
“You would have to say it is a reflection of the decision of the government to appoint a specialist agricultural commission to the ACCC,” Mr Weidemann said.
“Reading through their submission it appears they get a lot of the issues surrounding port access and what we are looking to achieve.”
ACCC agricultural commission Mick Keogh said his organisation felt the advent of significant on-farm storage capacity was not enough to be deemed a substitute to the bulk handlers’ upcountry networks, especially in terms of grain exports.
“On-farm storage is finding a real fit, in particular in regards to the domestic market on the east coast, but from an export point of view the supply chains operated by the bulk handlers are critical.”
Mr Keogh said the changing landscape of the Australian grains industry meant more grain types needed to be covered under the port access code.
“We’ve seen the explosion of pulse exports in recent years, canola and barley are also massive export crops and we feel exporters of these crops should have the same fair and transparent access to port facilities as wheat exporters do.”
Mr Keogh said the ACCC felt the grain industry needed its own separate code.
“There has been talk that port access could be governed under Section 46, the broader competition and consumer act, but to deal with the specifics of the grains industry in a timely manner we feel the port access code is required.”
The bulk handlers have also weighed into the debate, with GrainCorp in particular critical of the ACCC recommendations.
“We feel it would be a significant backward step if the department was to adopt the ACCC responses,” said Angus Trigg, GrainCorp corporate affairs director.
“Industry has made a positive transition from a highly regulated environment in the years of the single desk to a less regulated framework over the past decade.”
“There has been been hundreds of millions of dollars in investment across the country in both upcountry storage facilities and on ports.
“This increase in regulation would effectively freeze further investment.”
Mr Trigg also pointed out there was already significant competition on the east coast, both in terms of rival ports, such as the Newcastle Agri Terminal or Emerald Grain’s Port of Melbourne facility, and upcountry, in the form of other bulk handlers and on-farm storage.
“It would be silly to see the situation in terms of grain handling and exports as the same everywhere across the country, we are faced with significant competition.”
Viterra said it wanted the code to be applied to all port terminal operators equally.
“We consider it critical that the Code be applied equally to all port terminal operators to remove the significant likelihood of future regulatory and market distortions and the current in-built disadvantage to South Australian growers and the South Australian industry,” the company said in a statement.
Viterra said the execution of over seven million tonnes of grain exports through its ports for the 2016-17 season for 11 different exporters demonstrated there was a competitive market in place in South Australia.
The story Farmer groups delighted at ACCC port recommendations first appeared on Farm Online.