ACCC moves on wheat port terminals

27 Aug, 2015 10:34 AM
If exemptions are allowed the two port operators will bypass several code provisions

THE Australian Competition and Consumer Commission (ACCC) plans to exempt grain handlers Queensland Bulk Terminals (QBT) and GrainCorp from complying with parts three and six of the Wheat Code at their Brisbane bulk wheat export terminals.

"The ACCC's draft view is that the two Brisbane port sites face sufficient competitive pressures to warrant granting both port terminal operators exemptions from certain parts of the code," said ACCC Commissioner Cristina Cifuentes.

The two export facility operators will be subject to reduced scrutiny by the competition watchdog if the draft determination is not disputed by other traders or industry players in the coming month.

The ACCC said it examined the way QBT's and GrainCorp's terminals competed with each other for bulk wheat volumes and also considered competition between supply chain services associated with the port, including competition from grain exports via containers.

Its preliminary assessments found QBT's Brisbane facility had strong and direct competition from GrainCorp's Fisherman Islands terminal, and visa versa, despite QBT's facility having a lower level of handling capability.

Both bulk grain loaders also had significant competitive pressure from containerised grain exports, which represented 35 per cent of total wheat exports from the Port of Brisbane.

The Wheat Code, which commenced 11 months ago, regulates bulk wheat port terminal service providers to ensure all wheat trade exporters are given fair and transparent access to terminal facilities.

If exemptions are allowed the two port operators will bypass several code provisions, including obligations to provide non-discriminatory access, resolve access disputes through prescribed processes, or get ACCC approval for capacity allocation systems.

However, they will still be expected to deal with exporters in good faith and publish information about how capacity is allocated and the current state of their shipping stems.

"Given the competition between them, the amount of spare capacity at GrainCorp and QBT sites would create incentives for both port operators to provide fair and transparent access to third party customers in the absence of full regulation," the ACCC's Ms Cifuentes said.

GrainCorp noted the ACCC's plans while also observing related submissions from other grain industry players are still being received until September 30.

If the ACCC eventually makes final determinations to exempt QBT and, or, GrainCorp, Brisbane bulk wheat port terminal services would continue be monitored to assess the level of competition at these facilities.

Andrew Marshall

Andrew Marshall

is the national agribusiness writer for Fairfax Agricultural Media
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Jock Munro
27/08/2015 8:11:18 PM

The anti grower deregulation juggernaut rolls on and the winners are?- you guessed it - the merchant middlemen with the grower running a very poor last.
28/08/2015 10:23:06 AM

Jock, thanks for the update. For my records, who is running Second ? Third ? ...


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