June 9, 2004

Australian Dairy And Grain Industries In Dispute Over Feed Pricing

Dairy Australia has formally complained to the Federal Government about what it claims was unfair pricing of grain by AWB Limited.

The organisation claims that several times last year, domestic prices were higher than the price of imported grain.

Managing director Dr Mike Ginnivan is alleging that the AWB used livestock industries as a source of windfall profits, when grain supplies were short.

"We're not getting the same recognition as a growing market as some of the export markets. And all we're looking to do is to have organisations such as the AWB recognise that this is a growing, and indeed vitally important, market; and we need to have our requirements, and our future requirements, satisfied."

Dairy Australia made its claims to the committee reviewing the Wheat Marketing Act, which permits AWB to hold a monopoly or single desk for wheat exports.

AWB's David Johnson says his company has to balance the demands of the local feed grain market with maximising returns to its grower shareholders.

"We take our responsibility to be consistent and responsible pricers of wheat back to the domestic market very seriously, because on one hand you have all the consumer groups, which are trying to buy wheat and grain as cheaply as possible; on the other hand we have grower groups and growers, who are trying to price wheat they may have on farm."

"So we have to tread a very fine line between maximising the value of the pool, but also acting as a responsible participant in the domestic market."