Agmates

Agmates Editor Steve Truman writes:

Will Rudd retain single desk if Growers want it? - Part II

Speaking to Federal Independent MP Tony Windsor, he told us that he has received a considerable number of completed polls back from growers.

Tony off his own bat posted out 24,000 polls to wheat growers around Australia asking them did they want to retain the single desk. However it seems that a number of growers have not received it. To give these growers time to get their poll by post and complete it he has extended the cut off date until 23rd of April.

If you are a registered Wheat grower and have not received your poll paper in the mail please contact Tony’s office immediately ph(02)67613080 or fax (02)67613080. The Polls are registered and can only be delivered to you by Australian Post. Once you have completed your poll you can fax it back to his office.

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Here’s what a couple of politicians have been saying about the Single Desk issue over the past week:

First of all we will deal with another Howard era Liberal Party Politician who will not listen to the people he represents.

Western Australian Liberal MP Wilson Tuckey (pictured left) Member for O’Connor an electorate that runs from Albany in the South to Geraldton in the North and takes in a good many of the states wheat growers.

Now bear in mind that the Western Australian Farmers Federation that represents most of the states wheat growers has already polled it’s wheat grower members and found that 70% want the Wheat Single desk retained.

In his submission to the Senate inquiry last week Wilson Tuckey, says not only should the Single Desk be scrapped but individual farmers should be free to export wheat in bulk directly to foreign markets under the new wheat export arrangements.

The member for O’Connor called for growers to be excluded from needing a license to export wheat direct to individual markets.

Mr Tuckey said if growers were prepared to do the work and take on the risks, then they did not need any protection to sell their own wheat under the new legislation.

Mr Tuckey said the solution therefore was to exclude individuals or corporations who wanted to export wheat produced on their own properties from the export accreditation requirements.

He said because they are not middlemen and if they take such a choice, they had the right to assume their own risk.

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Agmates Comment:

If nothing else you have to love Wilson for the fact that he’ll pursue his died in the wool true Liberal ethos that the free market “knows all” and is “never wrong” - even when it is against the will of a majority the people he represents.

Perhaps Wilson Tuckey should revisit Greg Crook’s online thoughts on professional wheat farmers ability to compete with professional grain traders.

Greg made this comment on the article where we exposed Wilson Tuckeys fellow Western Australian Liberal Senator Judith Adams (what is it with the western australian liberal party?) telling the Inquiry this “porky” - Adams tells Senate Inquiry WA Wheat Farmers want Single Desk GONE!

Part of what Greg Said:

Surely it wouldn’t be that they have a total gut full of increasing risk and debt or perhaps its because they are all bloody good professional farmers and nothing more nothing less.

Farm/ Farmer in the dictionary means “A tract of land used for agriculture or other industry; to cultivate ; to raise livestock,fish etc on a farm “

Nothing about being a bloody hot shot grain trader trying to outsmart the rest of the world and coming a gutser every second time while the grubs ate the back paddock out because he was at the computer all day!

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QLD Nationals Senator Barnaby Joyce wrote to Agmates:

“Now, to another self-interested group talking about the benefits to the nation of deregulating the Single Desk: quite obviously, the only benefits are to those who will be left with a vertically integrated, regional monopoly of one of our nation’s major exports.

I am prepared to go double or nothing that this one will be at the expense of wheat growers in the majority and Australia in general. Unfortunately, I and many others feel we will have less success in stopping this one than we did stopping the private equity takeover of Qantas.

“With the removal of a single desk player from the wheat export market and its replacement by a vertically integrated monopoly, from receival to port to export, the position in the market and the grower is reduced.

“There will be no comparative market power within the wheat market place to bring a greater transparency and honesty to pricing. There is no capacity under part 3(a) for easy access to infrastructure for competition.

The recent battles which have been fought by Telstra to stop access by other carriers to telecommunications infrastructure should be a clear lesson about the inadequacies of the Trade Practices Act. Other participants are highly unlikely to be able to get a substantial foot hold in a market where the infrastructure is dominated by one player.

“All the new Wheat Bill will do is remove the legislation currently protecting growers from vertical integration by insisting that another player has access to a section of a market. It will also vastly reduce the bargaining capacity of most wheat growers.

“The philosophy of removing the bargaining power of the weak in favour of the strong, I thought, would be an anathema to the philosophy of the Labor Party; at least it was when they were talking about AWA’s at the last election.”

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Have Your Say!

Do you believe Individual Wheat Farmers should be able to market their own Wheat crop directly to foreign markets?

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Agmates Editor Steve Truman writes:

The Australian Bureau of Agricultural and Resource Economics is forecasting a record-breaking 25,950million tonne wheat crop, provided there is an average season, with a gross value of $8.6 billion.

Wheat prices are at record high’s (see table below) and, if the season goes well, there will be a record crop.

Rising demand for food, less arable land across the world, competition for crops to use as food and fuel, and climate change are remaking our farm sector’s future. Click Here to read the article in the Australian

The boom is on. Last week AWB offered $400 to $420 a tonne for its benchmark Australian premium white wheat in the coming season.

The Westpac-National commodity index has surged 26 per cent in the past year. According to the index, in Australian dollars the price for wheat has risen 85 per cent in 12 months, canola 72 per cent, dairy 29 per cent. Interestingly export beef has only rising 3 per cent in the same time.

The relatively high Australian dollar to some extent is masking the strength of the rise, which in US dollars is 47 per cent above the past year.

Below is wheat growers returns since over the last 17 years. Source ABARE. The first column is the Average price per tonne across all grades of wheat. The second from 1996 on is the total value of wheat production.

• 1990-91 $132
• 1991-92 $200
• 1992-93 $166
• 1993-94 $174
• 1994-95 $237
• 1995-96 $261
• 1996-97 $213…………………..$4.8bn
• 1997-98 $198…………………..$3.7bn
• 1998-99 $187…………………..$3.9bn
• 1999-00 $195…………………..$4.5bn
• 2000-01 $232…………………..$5.1bn
• 2001-02 $262…………………..$6.3bn
• 2002-03 $266…………………..$2.7bn
• 2003-04 $216…………………..$5.6bn
• 2004-05 $197…………………..$4.1bn
• 2005-06 $206…………………..$4.3bn
• 2006-07 $233…………………..$2.5bn
• 2007-08 $377……………………$4.9bn
• 2008-09 $333……………………$8.6bn Estimated with average season

The strength of wheat prices is expected to continue for a few years. However it may not be long lived as incredibly the US is pulling 6 million acres of country out of conservation reserve to grow crops on. Click here to read that story.

Have Your say!

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Agmates Editor Steve Truman writes:

In an exclusive interview with Agmates today Independent Federal Member for New England Tony Windsor (pictured) told Agmates:

“Prime Minister Kevin Rudd told me in a meeting in QLD prior to the Federal Election that Labor would retain the Wheat Single Desk marketing arrangement if a majority Australian Wheat Growers wanted it”

Tony intends taking Prime minister Rudd at his word. He has put together “The Wheat Marketing Export Poll” which has been mailed out to 24,000 registered wheat growers across Australia. ( Click here to see Tony’s message and scroll down to see the actual poll)

” Each poll sheet is Tag Coded to make the results verifiable. You can’t photo copy it, or download it from the net. Mr Windsor said”.

The poll form can be returned by fax or post but must be in Mr Windor’s office by the 16th of April.

Tony Windsor said “The poll was mailed out early this week and we already have over 400 polls back. There’s 24,000 gone out and we’ll need to get a large number back for the poll result to be authentic.”

“If the poll shows a clear majority of growers want to retain the single desk, I’ll be taking them to the Senate Inquiry and personally delivering them to Prime Minister Rudd (pictured) and Agriculture Minister Burke.”

I asked Tony why he was doing the poll:

“Not every wheat grower can get to the Senate Inquiry and have their say. The poll gives every single Australian Wheat grower the opportunity to tell the government emphatically what they want. It has become obvious that a lot of misinformation given to the government about what growers want to see happen. So it’s now up to them, they need to complete the poll and get it back to us.”

National’s Senator Barnaby Joyce gave his full support to Tony’s poll when I spoke to him today.

Have your say!

“Have you received your poll in the post? Do you have something you want to say about it?

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Senator Barnaby Joyce attended the Wheat Single Desk hearing in Perth on Monday, here’s what he had to say:

“Following Senate Committee hearings in Western Australia this week, it is clear that those pushing for deregulation are not growers but it could be well suggested the push comes from those with a vested interest in their own commercial position.

“In the state whose Senators (WA Liberal Senator Judith Admas) have stated virtually all wheat growers want deregulation, surprise, surprise the Western Australian Farmers Federation, a body that represents the greatest number of wheat farmers, stated that overwhelmingly their growers (about 70%) do not want deregulation.

“If growers do not want deregulation in the East and they do not want it in the West, where does this overwhelming support for deregulation come from? It appears the support for deregulation comes not from growers but from the companies looking to become exporters and entrench themselves as regional based and vertically integrated monopolies.

“The bulk handling companies that currently dominate port infrastructure and up-country storage and handling will now have the opportunity to become exporters and extend their dominance throughout the entire grains industry supply chain, squeezing out competitors and ultimately disadvantaging growers.

“By only looking at port infrastructure, competition can be stifled and growers will have to accept one price from one player in their region and the lack of transparency means that nobody, other than the bulk handler, knows what is in the system and where it is.

“Anchor deliverers, like anchor tenants in shopping malls, get a good price and the premium they receive is more than made up with a discount to other growers. Currently, this legislation leaves the Australian wheat grower with the potential for a closed shop monopoly protected by the accreditation provisions and no transparency in a legislated form to ensure everyone in the Australian grains industry is treated equally and fairly.

“In the same legislative stroke we have made the same mistake as we did in the fuel industry when we repealed the Sites and Franchise Acts, allowing total vertical integration. Now, instead of instead of total control of a market via vertical integration on import, we will create total vertical integration from receival to export and corporations, if they are legally allowed to exploit you for greater profits to the shareholder, not only will, they must.

“CBH in WA has 95% of the receival infrastructure. If housewives are held over a barrel by two supermarket retailers who can manipulate the market because of centralisation where two players hold approximately 80%, imagine how farmers will go in a market where one player has 95% of the receival infrastructure. Likewise, Graincorp and their major shareholder will have a tremendously powerful position in the east and the receival to export corridor will not be broken up by the inclusion of another player.

“Even the Wheat Export Authority, in 2007, found that with all its market power, the AWB monopoly was unable to reduce storage and handling charges.

“As insult to future injury, we lose also one of our greatest marketing advantages as so ably pointed by Alan Tracy of the U.S. Wheat Associates who is overjoyed by the success of the deregulation campaign in Australia.

Now Australian wheat can compete against Australian wheat in the majority of our export markets that have single desk buyers.

“If this legislation is not blocked or significantly changed, the future is the inevitable regional monopolisation and the discriminations to the growers and a financial boon to certain select players as they are delivered a monopoly position by the Federal Government.”

Have Your Say! Do you support government legislation to abolition the Wheat Single Desk Marketing system? Leave your reply in the text box below or Click on the Blue word Comments to leave your reply.

Agmates Editor Steve Truman writes;

Was Senator Barnaby Joyce at the same Senate inquiry in Perth on Monday as the West Australian reporter who filed this report? Growers back abolishment of single wheat desk the headline screams. (Click on coloured text to go to that story).

The lead paragraph says - “West Australian wheatgrowers have thrown their support behind the abolition of the single desk wheat marketing system, in stark contrast to eastern states growers.”

If you read Senator Joyce’s article and then read the West Australian article you’d have to think they were at 2 different hearings or if not one of them had succumbed to a mind altering substance.

Is it my imagination or is the West Australian article slightly biased toward the major proponents / beneficiary’s of abolishing of the single desk? Why would the West Australian be trying to convince the populous that WA wheat growers want the Single Desk gone?

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Here’s what some of the Agmate’s had to say about abolishing the single wheat desk last week:

You can see the full text of all the online comments below and more by Clicking Here and scrolling down the page.

Greg Crook WA.

“Farm/ Farmer in the dictionary means “A tract of land used for agriculture or other industry; to cultivate ; to raise livestock,fish etc on a farm “

Nothing about being a bloody hot shot grain trader trying to outsmart the rest of the world and coming a gutser every second time while the grubs ate the back paddock out because he was at the computer all day!”

Jock Munro NSW

“This is a treacherous piece of legislation that hands over the marketing of the Australian wheat crop to foreign multi national interests.

Our single desk marketing system is a credit to our Nation and the three generations of wheat growers who have developed it over 60 years.”

Rowell Walton QLD

” as every farmer knows, every meeting I have ever attended has had hundreds vote to retain our model of marketing, just one percent or less against and here we are with the Labor party about to give us the kinfe, farmers assume the Labor party will, but it was the Labor party which gave us this model, It has been the awful Liberal party which has so underhandedly bought us to this place with their philosophical extremism. “

Jock Munro NSW

“Tony Burke will one day realize that he has been ‘duped’ by trader middlemen and the Liberal Party. Lets hope for wheat growers sake it is in the very near future and he withdraws his treacherous Bill.”

Ben Reece

“The real question free marketers must explain is why major production contraction in 2006/07 compared to 2001/02 could only deliver $4.10 increase in domestic valuation of the unit price for wheat. A deregulated domestic market should have delivered a much higher premium.

It can be inferred from this data that the deregulated domestic market carries all the characteristics necessary for classifications as either market failure or excess capacity in the marketing sector. This needs to be identified and explained by supporters of the deregulation.”

Gary Butcher WA.

“The problem with Senator Judith Adams is that if she has ever been to any of the meetings in WA discussing the retention of single desk then she must have been asleep.

The meetings I attended had an overwhelming majority in favor of retaining single desk (300 for / 6 against Minginew 2007). The Western Australian growers I talk to are not against single desk but are sick of politicians not listening to to what the overwhelming majority has to say.”

Have your say! What are your thoughts? Do you agree with the federal government abolishing the single desk wheat marketing system? Click on the blue word comment below to have your say.

Queensland Wheat Grower Rowell Walton (Pictured) writes:

Last Chance for the Single Desk

Yesterday, myself & fellow QLD wheat growers Rodney Hamilton and Brian Packer attended the Rural and Regional Affairs Committee Inquiry into the Wheat Export Marketing Bill 2008 and the Wheat Export Marketing (Repeal and Consequential Amendments) Bill 2008, hearings on the Single desk of the wheat industry yesterday in Canberra.

The greatest surprise to me there was to find Western Australian Liberal Senator Judith Adams, (pictured left) telling the hearing with some glee;

“I might add that Western Australian Wheat Growers now support the removal of the Single Desk.”

Surprised by her comment I challenged her on the statement to which she replied, “Have you been there (WA) in the past two months?”

I responded “Well no, but I had spent Xmas there and I felt no obvious movement in attitude had occurred.” I was a wheat grower in WA before moving to QLD and still have family and many friends there.

Senator Adams replied “well it has and now the majority (of WA Wheat farmers) feel they have had enough and want to get rid of it.”

The Senate Inquiry in the the future of the Single Desk now heads to Western Australia on Monday with what I believe is an agenda to prove to the nation that the state with the most to loose from the removal of the single desk is now in support of the removal of the single desk!, then on to chaos.

It will be up to Western Australian wheat growers to make an impression on the good senators when they visit Perth on Monday and maybe before by making some contact with them in the usual way.

(NSW National Senator Fiona Nash (pictured) and Nationals Senator Barnaby Joyce are strongly backing Wheat Growers push to retain the Wheat Single Desk Marketing structure.

Senators names are highlited and are a link to their home pages with all contact details. Click on the name and from there you can send them an email or phone them direct with your opinion)

Our presentation to the committee yesterday (26/03/08) was a rushed affair and we managed to present our submission just in time. You do not have to present in writing, but we felt most of the issues were better put in writing for clarity so Senators could read and understand.

Clearly the QLD National Party Senator Barnaby Joyce and NSW National Senator Fiona Nash are supporting their wheat farmer constituency, and to a lesser extent VIC Liberal Senator Julian McGauran and SA Liberal Senator Mary Jo Fisher.

It has to be said, with out Joyce and Nash, no fight would be left from the wheat industry.

The Liberal party on the other hand, particularly NSW Liberal Senator Bill Heffernan (pictured left) who spoke by teleconference to us were not as sympathetic.

He said of wheat farmers, “they will have to stew in their own juice” One would wonder why we fund his breakfast and why the National party ever got into bed with them (the Liberals).

While the Labor party on the other hand, were concerned that they keep the election promise to get rid of the single desk, it seems right or wrong that is what they think they should do. Have they never heard of non core promises? Do they not know that Confucius said “To know what is right and not to do it is the greatest cowardice”

However Labor did have trouble answering our questions to with the philosophical similarity between looking after workers welfare by removing Howard’s workplace contracts, which would wind industrial relations back to the early part of last century and looking after wheat farmer’s livelihoods when very week farmers must trade with huge multinational companies in a similar manner to the early part of last century.

Some Labor people apparently do have a conscience and do understand the connection and wonder how to deal with this anomaly.

The chair of the committee a real nice young fellow by the name of Senator Glenn Sterle (Western Australian Labor) (pictured left) certainly does. It will be a challenge to him to see ordinary wheat farmers treated as most Australians would have working people treated, that their protection is not a optional extra, it is a right.

I imagined that this was similar to the Grain Growers organization that said their membership still supported the Single desk but they were not unhappy with the proposed legislation, which does away with the single desk.

I was also surprised that the same fellow was not able to understand a question posed by Senator Joyce (pictured), when he asked can you explain what will be the outcome of a commercial sale to a single desk buyer when two or more sellers arrive at this buyers door!!! I guess being the majority shareholder in Graincorp does have an effect on your view.

Editors Footnote: QLD National’s Senator Barnaby Joyce will be attending the Perth Senate meeting next Monday.

Have Your Say! Should the government abolished the Wheat Marketing Single desk? Click on the Blue word Comment below and on the next page type your opinion / comment / question / reply there. Rowell is waiting online to answer your questions.

Queensland Grain producer Rowell Walton in his “View from the header” writes:

The period from the early nineties till now has seen dramatic changes in grain marketing, from fully regulated domestically and internationally to the now entirely deregulated domestic market.

(My view from “the front of the header” during the 2007 Wheat harvest at Yulabilla Condamine QLD)

With the current push by certain groups to do away with he single desk of the Australian Wheat Board and complete the return to pre 1930,s marketing conditions grain producers need to consider carefully their future prospects.

While the world oil shortage and political need has seen the US move rapidly toward domestic production of fuel via ethanol from grain and following decades of low grain prices production has languished.

Now, a strong lift in prices has sent a signal to growers and observers that once again grain is king.

In the shadow of this profitable grain situation it is possible for political operatives to pursue with enthusiasm their agendas for change (code for deregulation) and utilize apathy as growers busy themselves to at last make profits.

(Delivering Wheat to the silo’s during last years harvest)

At any time grain production matches consumption and reserves are available grain price growth will be constrained, in this environment the vast majority of grain producers understand the need for a exporting system which gives them a semblance of ability to extract from the market a fair price. This has been the norm for the life of this producer.

(Header in action during last years Wheat harvest)

Just how the advocates of dismantling the single desk think Australian growers can benefit from the interchange of commerce when several sales people approach the same buyer in some far of place is beyond me, domestically however if a grower is weak and sells below a reasonable price then at least some local benefit may be appropriated, some feedlot or chicken producer who employs Australians, but to give away market power for nothing in return, is senseless.

Take the recent AWB board who have tried to make change and used name calling and innuendo to advance their call. Even the chairman a Queensland’er, asserts he has a mandate (more like a decree) while he fails to observe the rules that govern him, the constitution of the AWB requires that 75% majority be achieved for such changes.

Those are the rules the board must follow. It is this typical refusal to abide by rules, which has taken us to this sad place where even some growers think as a result of certain events we should dump the AWB.

(The men waiting for moisture levels to drop so we can get started again during the 2007 wheat harvest at Yulabilla Condamine QLD.)

Here’s a thought, those who refuse to abide by the rules should no longer hold the confidence of the shareholders and thus should resign forthwith and the shareholders should re elect a board that is prepared to follow the constitution and its rules.

No, I will not label them traitors; I will leave it for history to do that.

And who will benefit from the change advocated.growers? I think not.

Have your say. To leave your thoughts / or to tell Rowell what you think, click on the blue comments link below.