Australia to unveil liberalise bulk wheat arrangements

Australia's Agriculture Minister, Tony Burke, Thursday introduced legislation to the House of Representatives to liberalize bulk wheat export arrangements from July 1.

The bill delivers on a commitment made by the ruling Labor Party before its election to office on Nov. 24, he said.

Under the legislation, regulator Wheat Exports Australia will accredit multiple exporters, ending a protected system that, since World War II, allowed AWB Ltd. (AWB.AU) or its predecessor, the Australian Wheat Board, to operate an export monopoly or, in recent years, dominate exports.

The new legislation will establish a system that will provide Australian wheat growers and the grains industry a structure that will maximize incentives, minimize costs, increase supply chain efficiencies, reduce risk and protect growers, he said.

The legislation follows a Senate committee inquiry into a draft form of the legislation issued in early March. A key issue that developed during the Senate inquiry was whether access to upcountry storages should be regulated, in the way that infrastructure at export terminals will be.

Burke said it is not clear whether a problem would arise in relation to access to upcountry storage and if so how legislation should correct it.

The government will, therefore, continue to monitor the ability of exporters to access upcountry storage facilities, but would not plan to regulate beyond that, he told Parliament.

Australia accounts for 15 percent of the world's wheat trade, shipping on average 18 million tonnes of wheat worth AUS$5 billion yearly.