Judith Adams (WA, Liberal Party) Share this | Link to this | Hansard source

For many months, the issue of export wheat marketing has been a matter of public interest. Today I intend to inform the Senate of the progress made in the debate. The current wheat marketing arrangements have had a long history, and they have evolved over many years to meet the challenges facing growers. The past year and a half has been a very difficult time for the Australian wheat industry, and many alternative marketing arrangements have been proposed during this time.

The Cole inquiry forced farmers finally to discuss future wheat marketing arrangements in Australia and to ask: ‘What is the best option to market Australian wheat?’ It is vital that, whatever option or model is selected to resolve the wheat marketing arrangements in Australia, maximising grower returns must be the No. 1 priority. To commence the debate the Australian government announced the appointment of the Wheat Export Marketing Consultation Committee on 12 January 2007. The appointment of this committee delivered on the government’s commitment to put in place a consultative process to allow growers and other industry stakeholders to express their views on future marketing arrangements for the export of wheat.

The Minister for Agriculture, Fisheries and Forestry, the Hon. Peter McGauran, is to be congratulated on his choice of four very competent and experienced committee members. The chairman, Mr John Ralph AC, has been the deputy chairman of Telstra Corporation Ltd; the chairman of Foster’s Brewing Group Ltd, Pacific Dunlop Ltd and the Commonwealth Bank; and director of BHP Ltd and Pioneer International Ltd. Other committee members include Mr Roger Corbett AM, who is well known for his outstanding work as the former chief executive officer and group managing director of Woolworths Ltd; Mr Peter Corrish, past president of the National Farmers Federation; and Mr Mike Carroll, the immediate past general manager of National Australia Bank’s Agribusiness division.

The committee undertook an extensive consultation process, travelling throughout Australia to meet with representatives of the Australian wheat industry, which included growers, marketers and representative organisations. The committee is due to report to the government this Friday, 30 March 2007. The consultation process throughout February 2007 included 25 public meetings in the major wheat growing regions of Queensland, Victoria, New South Wales, South Australia and my home state of Western Australia. The purpose of these meetings was to gain evidence from farmers and others associated with the wheat export trade to determine the best model for Australia’s future wheat export marketing arrangements. I attended five of the eight meetings held in the wheat-growing areas in my state of Western Australia, at Geraldton, Dalwallinu, Merredin, Katanning and Perth. It was important for me to hear what Western Australian farmers had to say so that I could obtain the information I need to make an informed decision about this issue when the time comes.

I was impressed with the fact that most speakers were prepared for the meeting and had clearly read the information provided by the government on the Wheat Export Marketing Consultation Committee website—in fact, several speakers referred to it and thanked the committee for providing it as a jumping-off point to their presentations. That website really did prepare people about the process they would have to face in attending the meetings. When addressing the committee, the majority of speakers identified themselves as either in support of or against a single desk marketing arrangement, a national pool and a separation of AWB Ltd from AWB International. Further to that, farmers who addressed the committee went on to explain their need for transparency of marketing arrangements and market information and the so-called buyer of last resort and security of payments. Those who supported a deregulated market discussed a possible transition period to this arrangement, the continuation of bag and container exports and potential buyers of Australian wheat. The meetings were a great opportunity for farmers to hear a range of other opinions, and I think a large number of them learnt a great deal about the lack of accountability and transparency in past marketing arrangements.

Many growers identified that the turning point for wheat marketing in Australia came in 1999, when the statutory wheat marketing of export wheat ended and the government underwriting of the borrowings ceased. The commercial roles of the former Australian Wheat Board were transferred to a grower owned and controlled company, AWB Ltd. The single desk was retained, with AWB International, a subsidiary of AWB Ltd, having exemption from the Wheat Export Authority export controls and being given the power to veto other bulk exporters. It was mentioned at least once at each of the meetings I attended that this legislation had not served the industry well and that the result seemed like an iron curtain that had been put up between AWB and the wheat growers.

I was happy to hear one farmer acknowledge that the member for O’Connor, the Hon. Wilson Tuckey, had raised questions about this legislation from the beginning and could see the potential for problems to arise. In his speech in the second reading debate of the Wheat Marketing Legislation Amendment Bill 1998 in the House of Representatives on 1 June 1998, Mr Tuckey said:

I hope my concerns are never realised. However, just as I have promoted them in party forums, I would be wrong not to put them on the record today.

I suggest to senators here that they look back at those speeches made by the honourable member for O’Connor. He spoke in 1997 and 1998. It is quite frightening that what he said then has actually happened.

To go back to the meetings: throughout the meetings many farmers stated that they were supportive of the single desk, but an analysis showed that 20 per cent were supportive of the status quo and some 70 per cent were supportive of some kind of single desk but did not want to go back to the model they had with the AWB monopoly. I will go through some of the comments made by those who did not want to go back to a single desk model. A farmer at the Perth meeting declared that monopolies were impossible. I would have to agree with him. At the PGA conference held recently in Perth, Paul Kerin spoke about the monopoly of AWB and compared it with the East India Company. Those of you who are interested in history, please go back and have a look. I can certainly provide his speech, because it was very entertaining—but, my word, there were some comparisons and it was quite frightening.

A farmer from Badgingarra, north of Perth, said that he felt it was a basic denial of his rights to force him to sell his wheat to AWB. Another farmer, from Cranbrook, agreed, saying that as an individual grower he wanted the ability to choose where he sold. A Katanning farmer said that, in the interest of the industry, it was time to move on—deregulation was inevitable but not necessarily immediately. Interestingly, a farmer at the Merredin meeting said that growers who supported deregulation were selfish. We had another counterargument on this in Perth when a farmer from the Midlands area, north of Perth, supporting deregulation and speaking on behalf of 34 other like-minded farmers, said it was not his responsibility if another farmer made a bad business decision. This group of farmers considered it was their ‘property right’ to sell grain where they wished. A Calingiri farmer said he was insulted by the insinuation that growers could not be marketers. He wanted choice. A farmer from Eneabba was bewildered as to how, in this country, the outdated system of the single desk was still in place.

The most important point made during the meetings was that many farmers would not have attended or spoken at the meetings because they did not want to give an opposing view to that of their neighbours. I found, going to a number of these meetings, that people came to me later and said, ‘I would have loved to have spoken but so-and-so was up there speaking the other way and I didn’t want to upset him because he’s a good neighbour.’ But I think this barrier has been broken. The debate is right out there, and I think this consultation process has made a huge difference for us.

In Western Australia, some 95 per cent of the wheat produced is exported. I think people in this place have heard us go on about this. It is very different to the eastern states. They already have a deregulated market. In Western Australia our domestic market really is to the north of us, in Asia. We have to export our wheat. The dependence upon exports is not shared to anywhere near the same extent by wheat growers in other states. Therefore, the wheat growers in Western Australia and South Australia are left with no choice but to pay the fees extracted by AWB Ltd as the service agent for its fully owned subsidiary AWB International. As I said, growers in the eastern states are operating in a completely different market from their Western Australian counterparts.

I now would like to speak a little about our new breed of farmers—young farmers who probably face the world in a different way from their parents and who are looking at the single desk as being their way of marketing. These young farmers have attended agricultural colleges and understand that marketing and computer skills are very important to running their businesses. If they need to know the current wheat price, they know how to get it. As a result, younger farmers have the confidence to market their own wheat. They do not think the world will end if deregulation comes into effect, and they acknowledge that, if AWB is a strong exporter and good at what it does, growers will continue to use it.

A recent media release by the Grains Council of Australia touched on the subject of younger farmers and the role they are playing in the future of wheat marketing. The chief executive officer, Murray Jones, said:

We have to look to the future and not to the past for answers. My message here is to not ignore younger farmers. If you do ignore them or shout them down, they will switch off and you will lose them as members or potential members.

Young farmers need to be listened to and their contribution respected, because they are the future of the industry and the future of your organisation.

He was speaking about the Grains Council of Australia.

Another farmer, in Katanning, stated that really competition was not a worry and that he has great faith in young farmers. He has two sons and they should not be held back by the older farmers.

I would like to commend the Wheat Export Marketing Consultation Committee for the excellent job they did in conducting these meetings in such a professional manner. Each speaker was given appropriate time to make their point, and the committee and the audience treated them with respect. I am looking forward to the committee’s report, due to be released on Friday, and I am sure it will make interesting reading.

Other initiatives that have emerged since the conclusion of these meetings include a groundbreaking education program which has been designed to empower growers with a competitive edge in marketing their own grain. This commenced in rural Western Australia this week. The National Agricultural Commodities Marketing Association, known as NACMA, has joined forces with Curtin University of Technology, through its Muresk Institute, to produce a targeted education program aimed at boosting farmers’ ability to market grain. The course material is designed specifically for WA growers and will provide them with an intricate understanding of how grain is marketed internationally and how to cope with a vast array of options should they arise.

Just to conclude: I was very happy to see that a meeting will be held tomorrow of a non-binding working party of industry grain marketers. The group includes AWB, ABB, CBH, GrainCorp and the Grain Growers Association. The Grains Council of Australia has also received an agreement that the department and the Wheat Export Authority will help the working party with advice if required.

It is great to see that these organisations will be working together. They are competitors but they are going to get together tomorrow to try to work out a solution, as we in the parliament are doing. We are having many meetings—and we have a large number of lobbyists here, all with very good credentials—to try to come up with a model that really works. I would like to add that I will be applying tomorrow to postpone the introduction of the Wheat Marketing Legislation Amendment Bill 2007, which is on the Senate Notice Paper. I do not think this is the right time to begin debating it, but I still believe in my own heart that that is possibly the way forward.