WEST PERTH, AUSTRALIA — The CBH Group said on Oct. 31 that it has commenced the process for the Economic Regulation Authority (ERA) to be involved in its negotiations with Brookfield Rail over access to grain rail lines.
CBH General Manager Operations David Capper said the cooperative had been in extensive consultations with Brookfield Rail to try to reach an acceptable commercial arrangement to replace the current rail access agreement which expires in June 2014.
"We have been negotiating in good faith for the past four months but at this stage it seems unlikely that agreement can be reached by direct commercial negotiation, given our differences in pricing expectations. Therefore we have formally commenced the process to seek an access agreement under the Railways Access Code," said Capper.
Negotiations have focused around CBH achieving satisfactory access to train pathways, ensuring that general performance standards of the track are maintained and that access fees charged by Brookfield Rail are reasonable, so that the grain supply chain in Western Australia can remain competitive with other international origins of supply.
"We just cannot justify entering into an agreement on behalf of the growers of Western Australia that essentially costs more, and significantly more, for access to fewer tracks with diminishing performance," said Capper. "WA growers need to be competitive with other countries where supply chain costs are significantly lower than ours. Even domestically, our current cost for track access is higher than any other state in Australia. We are becoming less competitive every year.
"We expect that by seeking access to the network under the code, growers will be able to continue to access a key piece of State infrastructure that is critical to the viability of the industry and that it will provide the basis for pricing that is sustainable for the years ahead. All we want is a fair price for fair performance. Growers deserve to have a network they can rely on to carry their produce to market for many years to come."
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