CBH to appeal decision on Grain Express

by World Grain Staff
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WEST PERTH, AUSTRALIA — CBH Group announced on July 19 that after much consideration it has elected to appeal the recent decision by the Australian Competition and Consumer Commission (ACCC) to revoke the exclusive dealing notification for Grain Express.

CBH Group Chairman Neil Wandel said CBH remained of the strong view that Grain Express in its current form provided Western Australian growers, the grain industry and the community with the most efficient grain logistics system possible without substantially lessening competition in the market for grain transportation services.

“We have the evidence to prove this and we also consider our prospects of success at an appeal make it worth pursuing,” Wandel said. “As we have said repeatedly, our determination to try to retain Grain Express for growers is not because we are trying to protect an inefficient system or to avoid competition.

“It is because we genuinely believe the current bundled system delivers more efficiency and benefits to growers and the industry than having multiple marketers coordinating grain transport from our upcountry receival sites to port. These benefits include enabling all grain marketers to offer prices to growers at any delivery site in the CBH network.

“With or without the authorization from the ACCC, CBH Group will continue to offer the most competitive grain storage, handling and transport system to growers and the industry.

“However, the uncertainty created by potential leakage to competitor transport systems and increased operating costs associated with gearing up for multiple user access to our sites will lessen overall efficiencies and value delivery to growers.”

CBH Group said it will lodge its appeal against the ACCC decision to the Australian Competition Tribunal on July 19. The tribunal will determine how it progresses the matter including presentation of evidence and submissions from interested parties.

“Inevitably, this again will involve more cost and some continued distraction for our business,” Wandel said. “However we strongly believe it is CBH’s responsibility to champion the best interests of growers in Western Australia.

“Grain Express provides security of volume to our rail and road transport providers and therefore enables CBH to negotiate hard to keep overall transport costs as low as possible. It also allows us to co-ordinate the clearing of stacks and sites in one movement, reducing handling, equipment, fumigation costs and the risk of insect resistance to fumigants.”
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