Grain grower groups have welcomed an announcement the Labor Party will back a “long overdue” inquiry into Australian grain pricing, and have labelled the Coalition’s response disappointing.
Grain Producers Australia, Grain Growers Limited and the NSW Farmers have called for an inquiry, criticising “suboptimal” prices paid to growers and a lack of transparency over how grain handlers determine prices.
In a statement provided to Grain Producers Australia, Labor Party national secretary Paul Erikson said Labor was “prepared to meet the sector to better understand the basis of current concerns, and how an ACCC study would assist in addressing current grain grower concerns, as well as potential cost-of-living impacts for Australian consumers”.
GPA chair and Western Australian grower Barry Large said Labor’s response was “encouraging”.
Labor has also committed to meet with grower groups to discuss a high level strategic analysis into reducing grain freight costs.
In comparison, Mr Large labelled the Coalition’s response to the ACCC market study request “disappointing”.
The government’s response “supported the status quo continuing, in believing Australian grain producers are operating under a fair and level playing field”, he said in a statement.
GPA formally submitted its request for an inquiry to Agriculture Minister David Littleproud in mid-March, but the government has not supported the call.
Mr Littleproud’s spokesman told The Weekly Times that Federal Treasurer Josh Frydenberg was “assessing the evidence provided and has indicated his decision won’t be until after the election”.
Liberal Party federal director Andrew Hirst wrote to the GPA, saying the Coalition would continue to ensure a fair and level playing field.
“The government will continue to engage closely with industry on competition issues, including on evidence of wrongdoing across the supply chain,” Mr Hirst wrote.
Mr Large said the government’s response wasn’t good enough.
“Among a range of serious findings regarding competition failures, GPA’s analysis and report found that about 25 million tonnes of grain is expected to be exported from the last harvest at a $50 per tonne discount,” Mr Large said.
“This equates to $1.25 billion loss to growers for the 2021-22 harvest, which was a record 62 million tonne return.
“We are calling on the government to utilise the ACCC’s special powers, to investigate how and why this significant value is being lost for local growers, rural communities and the national economy, while examining other critical issues regarding the misuse of market power,” he said.
Australian Securities Exchange listed grain handler GrainCorp, which handles roughly one third of Australia’s grain exports alongside South Australian-based Viterra and Western Australian CBH Group, last week labelled grower calls for an inquiry “noise”.
GrainCorp managing director and chief executive Robert Spurway told investors there had “some noise from grower groups” about prices paid to growers, but “the fact of the matter is that Australian growers are receiving record prices for grain at the moment”.