March 11, 2008

 

Australian grower lobby backs changes to wheat export law

 

 

Wheat growers have to accept a liberalization of wheat export arrangements is underway and adapt to the change, the chairman of national grower lobby Grains Council of Australia said.

 

The Labour Government has made it clear it intends to implement new arrangements to liberalise wheat exports - as pledged before the Nov. 24 general election - despite strong concerns expressed by some grower groups, Murray Jones said Monday (March 11, 2008).

 

"Grains Council is of the view now is the time to move forward; now is the time to move on, and accept and adapt to the changes that we need to and help our growers adjust," Jones said in an interview on Australian Broadcasting Corp. radio, echoing similar sentiments from late February.

 

Last Wednesday, the Labour government unveiled draft legislation to establish a system to accredit multiple bulk wheat exporters to be in place by July 1, when current export arrangements expire.

 

Grains Council is a grouping of state-based farmer lobbies, some of whom remain opposed to the planned liberalization and who continue to lobby against the changes.

 

Labor's pledge to accredit multiple wheat exporters will effectively end a protected system that has seen AWB Ltd operate either an export monopoly or remain the dominant exporter.

 

Domestic grain companies and international commodity traders want to compete to export Australian wheat. At stake is a share of annual exports of up to 18 million tonnes worth up to AUS$5 billion (US$4.61 billion ), or more than 15 percent of the global wheat trade.

 

Meanwhile, three of Australia's four major domestic grain companies, Tuesday moved to assure growers that they will continue to offer a range of marketing options, including collective sales pools and quality incentive programs.

 

Don Taylor, chairman of GrainCorp Ltd. (GNC.AU), said claims and rumors circulating that growers would not be offered these options under new export arrangements are wrong.

 

The assurance to growers occurred in an unusual joint statement issued by GrainCorp, ABB Grain Ltd. (ABB.AU) and unlisted Cooperative Bulk Handling Ltd., who are competitors now and will continue to be under the new law covering wheat exports.

 

Tony Critch, chairman of CBH, contends the government has "the full support of the corporate sector of the industry and grower shareholders."

 

CBH will offer sales pools for the next harvest in late 2008, and has increased numbers on its wheat team and is putting final touches in place to its systems and financing options, he said.

 

"The most important single point about the removal of the monopoly is that growers will have more choice, and there will be more companies to buy wheat from growers," Critch said.