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 Single desk chapter ends as WGA disbands 

Single desk chapter ends as WGA disbands

01 Apr, 2009 03:53 PM
A tempetuous era of Australia's wheat industry has ended with strident single desk supporter group, the Wheat Growers Association, last week making a decision to disband.

With the industry no longer featuring AWB Ltd A Class (grower) shareholders or a national wheat pool, members of the WGA agreed at its recent AGM to wind up operations.

It marks the end of a short, but incident-filled history for the WGA, which campaigned tirelessly for the retention of the single desk against increasingly overwhelming odds.

WGA chairman, Newdegate, WA, grower Bob Iffla said the landscape of the grains industry had changed markedly since the group began in 2002 and that the industry had moved past the WGA's single-agenda charter – maintaining the single desk and maximising returns for growers who delivered to the national pool.

However, he said there was still a strong role for grower advocacy groups, who must now focus on different issues in a deregulated environment.

"The agenda going forward needs to include addressing road, rail and port infrastructure issues, the future of grain storage systems, the need for multi-peril insurance and a host of other matters stemming from the Federal government decision to hand control of the industry to grain traders," he said.

Mr Iffla urged growers to form a united front to create a strong lobby presence, an advantage enjoyed by growers in Europe and the US.

He was satisfied that the WGA had achieved good outcomes for growers in its short existence, highlighting the battle to change the AWB remuneration model.

"Massive benefits flowed through to growers when the AWB Ltd remuneration model was changed in the 2006/07 season, following pressure from the WGA and others," he said.

He also said the group had worked well with the previous Coalition Government, but expressed dismay at the Rudd Government's decision to dismantle the single desk.

"We worked constructively with Coalition Government to maximise grower returns from national pools and did so at the highest level," Mr Iffla said.

"The decision of the Rudd Government to remove the National Pool export single desk against the wishes of the majority of grower opinion expressed to the Wheat Export Marketing Consultation Committee was a bitter disappointment."

He said deregulation had been a failure thus far.

"Wheat growers around Australia are now encountering many of the road, rail, grain storage and market based problems raised by the WGA at the time, but dismissed as being irrelevant by the Rudd Government and critics of single desk marketing," he said.

He suggested the fight for grower representation would go on, especially in Western Australia, where the State's bulk handler, CBH, is still run as a grower co-operative.

"Growers in WA have some chance of protecting their future by ensuring grower control of Co-operative Bulk Handling is maintained," he said.

"In other states growers will need to explore other avenues to avoid being pawns in the hands of bulk handlers and grain traders."

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You have done a reasonable job Mr Iffla but you over stepped the mark by your continual hounding of the AWB cost structure. The minimal pool costs under the old system appear very small indeed with the price gouging that growers are now under. Farmers need to be a little more reasonable in their criticism of structures that were put in place for their benefit. A thorough dose of deregulation may promote a little more balance and far less unreasonable criticism and beligerance.
Posted by Wheat Fields., 1/04/2009 7:30:19 PM
Congratulations, Bob, on doing such a good job defending the majority against a corupt process funded by multi national traders.

A lot of state grains leaders need to take a look at themselves and represent the majority not their own personal agenda. A lot of strong anti single desk supporters are slowly waking up to the fact deregulation is a disaster, including our own KRudd PM who is openly condemning free marketing. It's a shame he had not adopted this platform two years ago.

Posted by Mark, 2/04/2009 6:59:50 AM
Thanks to deregulation, WA are growers are $30/tonne better off. We aren't subsidising eastern states growers for the first time in decades.

As the year goes on, Australian grain growers and the public at large are going to be shocked at revelations about the money growers didn't receive from the AWB. I am continually amazed at people who support a model which only propped up incompetent farmers.

Competition within markets is the key.

Posted by allmattergreen, 2/04/2009 9:13:11 AM
Allmattergreen, has a problem with maths, during harvest all growers enjoyed a fifty five to sixty dollar discount to the international market. As well, with no hedging done during the year on growers' behalf, none of the excessive international prices last year could be taken advantage of, costing growers an estimated 1.2 billion.
Posted by Ken, 4/04/2009 7:13:26 AM
"allmattergreen", you are on-the-money with your comments...compare WA with east-coast ..."Ken", do you understand basis? Prices at harvest are driven down due to weak sellers. When weak sellers disappear, our price relative to the international improves...it's not rocket science...and yes some growers did give away 50-60mt, out of ignorance!
Posted by young farmer, 9/04/2009 7:54:13 PM
'Allmattergreen' is delusional...wont he get a shock when WA has so much grain lying around that they will not know what to with it? Ignorance is bliss!
Posted by Wheat Fields., 10/04/2009 6:45:28 PM
Young farmer, with 20,000 farmers marketing grain at harvest the basis will always be undercut because we are only selling to a handful of buyers who are not accountable to produces (the basis discounting starts at about October and ends Feb).

When weak sellers are gone, so will the bulk of our production. The industry needs its bulk mass to maintain its infrastructure (already a problem) and along with it our comparative advantage as an exporter.

Posted by Ken, 12/04/2009 2:31:58 PM
Wheat Fields, I am staggered by your attempts to rewrite history. I don't know how you can possibly describe the plundering of the National Pool by AWB Ltd, with the non-negotiable base fee and the Out Performance Incentive that the AWB executives got to set for themselves as MINIMAL.

You had best go look up the meaning of the word.

I note that CBH has been in the media this week reporting that it has cleared the backlog of ships and are planning on how to better manage their logistics next year. That is how markets respond to changing demand.

Mark, I would not put much hope in Kevin Rudd's condemnation of free markets. He is simply saying what his media advisers tell him to, depending on what the story of the day is. A regulated market will not be coming back - if you don't pool your grain you are going to have to make marketing decisiona.

So I suggest you start improving your business skills.

Posted by damian capp, 12/04/2009 7:28:44 PM

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