WA wheat growers say retain single desk
Posted on Friday, 22 December 2006
More than 300 hundred growers throughout the Wheatbelt travelled to the town of Beverley on Monday night, to directly question AWBI representatives about the future of wheat marketing in Australia and the single desk.
Growers wanted to make it clear that those who say they are warehousing their wheat because they don’t want to sell to AWB, are wrong.
Growers are warehousing their wheat due to the uncertainty. If licences are given for large quantities of wheat to be sold outside the national pool, those who have delivered to the pool will pay a disproportionate share of the costs. Deliveries to the pool will be lower this year due to the drought without further diminishing the pool by issuing licences beyond what have been issued in previous years.
A large number of growers indicated that they intended delivering to the AWB, notwithstanding the uncertainty.
Wheat growers expressed their concerns about the possible deregulation of the single desk and put forward a near unanimous motion to be forwarded to the Minister for Agriculture, Fisheries and Forestry Hon Peter McGauran MP. The motion sought a commitment from Government not to deregulate the industry nor approve separate licences for the export of wheat during the 2006-07 harvest.
Ms Moylan attended the meeting, following up with a letter to the Prime Minister and Minister McGauran outlining the key issues raised by growers.
“It appears from meetings held in WA that an overwhelming majority of WA growers want the national pool to be retained,” says Ms Moylan.
“Wheat growers made an investment decision about 12 months ago, prior to the Cole Royal Commission Inquiry, to plant a wheat crop expecting that it would be marketed through the national pool,” Ms Moylan said.
The national pool, hedges or locks in prices in the international market to protect those who deliver wheat to the pool against price fluctuations. They also take out foreign policy protection to safeguard against fluctuations of the Australian dollar.
“Changing the rules at the eleventh hour of harvest, disadvantages the majority of growers. It creates more uncertainty and financial instability.”
While the disappointment and anger at the actions of some in AWB is understandable it is important to keep a clear head. AWB is a corporate entity capable of recovering its position as the premier marketer of wheat.
“The Cole Inquiry has recommended that the actions of several former AWB employees be investigated and the full force of the law should be brought to bear if they are found guilty.”
During the banking scandal several years ago, one of the nation’s major banks was not disbanded nor did it lose its banking licence because of breaches of the banking regulations. Those responsible were prosecuted and sent to jail.
AWB has marketed wheat for about 60 years to over 100 countries, investing millions of dollars of wheat growers’ funds in securing and retaining international markets for Australian wheat. Ms Moylan says it is in the public interest to retain vital international markets which are volatile.
“This is critical to Australian growers as the international grain market is distorted due to a high level of subsidy to United States and European Union growers.
“The AWB pool provides premiums to Australian growers, accepts all Australian-grown wheat if it meets health standards and growers are paid according to the quality of the grain they deliver.
“By allowing large quantities of wheat to bypass the national pool, growers who have already committed to the national pool will be severely disadvantaged.
“It is probable that new applicants will ‘cherry pick’ grain to suit their needs, leaving the AWB with whatever is left. This would compromise the integrity of the single desk.”
AWB has had to hedge prices well forward of the harvest to retain markets for future years. This has been made more difficult by the reduced yields as a result of the severe drought.
“Granting new licences would prove to be a short-term solution, which in the long-run would have detrimental effects on the industry.”
At the Beverley meeting Ms Moylan continued to urge farmers to have their say on the future of wheat marketing, as part of the three-month consultation process announced by the Prime Minister.
Similar meetings to that in Beverley have been held in rural parts of the State and are currently taking place throughout the country, with attendances well into the hundreds at each forum.
“The message is unequivocal: the majority of growers want the national pool to be retained.”