Report: Continuing Australian wheat reform needed

by World Grain Staff
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WEST PERTH, AUSTRALIA — A study commissioned by the CBH Group has endorsed the government’s plans to further wind back regulation of the wheat export market to bring it into line with other agricultural exports, CBH said on Aug. 27.
The report, “Continuing the Reforms of the Australian Wheat Export Market,” was prepared by ACIL Tasman.
It says the reforms to date, and the expectation further deregulation would occur in 2014, had attracted a range of new services to the market from existing and new participants.
In addition, there had been significant infrastructure investment and grain was being exported to more countries than under the previous single-desk system.
“Growers have been the main beneficiaries of these reforms through improved services and more competition for their grain,” the report said. “Export dependent WA grain growers in particular have in recent seasons established improved prices for their wheat exports when compared with Australian east coast growers.”
CBH Group Chief Executive Officer Dr. Andrew Crane said CBH had commissioned the analysis from respected economic consultancy ACIL Tasman because of concern over pressure from some groups who wanted to turn back the clock and re-regulate the industry. The views of these groups were not shared by many in the industry including all major grower organizations in Western Australia.
“It is competition, not more regulation, that will drive efficiency, focus on appropriate quality, competitive pricing and innovation,” Crane said. “Regulation will not solve any perceived problems or gaps that have occurred since deregulation, these will be resolved over time by the normal operation of the market as they are with almost every other commodity exported from Australia.”
Crane said the ACIL report had confirmed the increased regulation being called for by opponents of continuing reform was not based on substantive evidence. On the contrary, reregulation would discourage industry investment and push more costs back onto Australian growers and traders.
“The federal government’s WEMA Amendment Bill 2012 is very important legislation for wheat growers,” Crane said. “It should be supported by those who want to see the wheat export industry reach its potential, free of unnecessary, costly, inflexible and potentially unworkable regulation.
“We urge all members of Federal Parliament to carefully consider the implications of imposing further regulation and levies on an industry when there is little or no evidence it is required, or that it has anything like full industry support.
“Parliamentary representatives also should be aware that the uncertainty created by the current situation is also detrimental to industry planning and could stall investment.
“This industry needs to be given more of a chance to come together to agree on industry issues and resolve them ourselves. This includes the development of an industry code of conduct on port access which is now well underway and will be flexible and responsive to industry needs.”
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