Australian grain exporters to meet CBH on port access plan

 

 

Members of the Australian Grain Exporters Association will meet Western Australia's monopoly export logistics provider, Cooperative Bulk Handling Ltd., next week to discuss improvements to CBH's port capacity allocation process.

 

AGEA members, which comprise some of the world's biggest grain traders, want a market-based mechanism whereby they can bid for export capacity well in advance of the actual shipping period, Alick Osborne, an AGEA director said Friday.

 

"So people can lock in export capacity in advance and therefore have certainty as to what sized export programs they're going to be able to operate," he said in an interview. "We wanted an improved situation for next season compared to what we endured this season."

 

CBH, which operates Western Australia's four grain export terminals, was overwhelmed by demand from exporters earlier this year as a dozen of more companies vied to export grain, mostly wheat, soon after harvest, the first after wheat export arrangements were liberalized on July 1, 2008.

 

In February, CBH stopped taking bookings on its ship-loading schedule as it sought to clear a backlog, in part also reflecting the impact of a rain-delayed late harvest on CBH logistics and limited capacity to haul grain from upcountry storage sites to coastal terminals.

 

The backlog saw vessels delayed in ports for several weeks and some overseas customers express concerns about supply arrangements.

 

Osborne said AGEA previously sent a discussion paper to CBH after talks about the situation.

 

"Everyone acknowledged the need for a more market-based solution to allocating export capacity at the ports," he said.

 

CBH is scheduled to present a response next week, with exporters hoping it represents a genuine improvement on last season, he said.

 

"It's a question of how do we allocate port capacity in a fair and reasonable manner that allows people to know what there program can be with a higher degree of certainty than has been the case this year and avoid the cost of congestion seen this year, he said. "Industry is trying to find a solution."

 

These talks are separate to a formal process underway by which CBH and other major logistics providers give formal access undertakings to the national competition regulator.