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Thursday, 18 October 1956


Mr LAWRENCE (Wimmera) .- I support the bill, as it continues, in principle, the conditions for wheat marketing under the International Wheat Agreement, which was first introduced in 1949, and extended in 1953. In April of this year, the Minister for Trade (Mr. McEwen) announced that the United Nations Wheat Conference had decided, in London, that a new International Wheat Agreement should be opened for signature. This remained open for signature in Washington until 18th May. Sir Edwin McCarthy, the leader of the Australian delegation, was authorized to indicate that Australia would sign the agreement. This he did, and the agreement which was signed at that time is now before the House for ratification. It is quite obvious that all members of the House are prepared to agree to it.

I do not intend to weary the House by repeating the information given by the Minister regarding the variation in price under the new agreement and the reduced quantity that Australia will be called upon to supply. The main objective of the agreement is to foster stable prices and equitable marketing in the world wheat trade. It does this by defining a price range within which transactions in wheat under the agreement will take place and by giving exporters and importers the right to call on the International Wheat Council to see that market opportunities at the minimum price or supplies of wheat at the maximum price are available up to the limits of the specified quotas. The contribution to trading stability which this agreement can make obviously depends mainly on the proportion of the world wheat trade which comes under the agreement. For this reason, it has been a disappointment that the United Kingdom has decided not to join the new agreement and that lower quantities submitted by some of the other importers have reduced the total quantity of wheat substantially below that provided under the agreement which has recently expired.

The United Kingdom representatives probably felt that they had very good reasons for refusing to re-enter the International Wheat Agreement. They evidently felt that it was in the interests of the United Kingdom to stay out. Whether or not the International Wheat Agreement can exist much longer without the inclusion of the United Kingdom, its effectiveness as a floor to the wheat markets will continue to diminish. I believe that this could very well mean cheaper wheat. The United Kingdom representatives, in presenting their arguments, stated that they were adhering to the principle that commodity markets should be free from government interference. They also said that they believed that the International Wheat Agreement would do nothing to reduce the world's excessive stocks. The Minister for Trade gave a very effective answer to both of these points. He said, " No country has engaged more deeply in the production of wheat at uneconomic levels of cost than has the United Kingdom itself ".

Part of the British case was left unexpressed, but is perhaps more convincing than the expressed part. The United Kingdom representatives must have felt it a little inconvenient, to say the least, to plead direct self-interest, because they must have remembered that for the four years of wheat scarcity up to 1953, the International Wheat Agreement provided the United Kingdom with cheaper wheat than was obtainable outside the agreement. This does not absolve the United Kingdom entirely from some obligation to exporter nations, especially Australia. Australia has a right to claim this because of the one-sided way imperial preference has worked against her. I hope that in the future we shall have the United Kingdom in the International

Wheat Agreement, for I believe it can function at its best only if the United Kingdom is a member.

In the preliminary discussions preceding the present agreement, Australia supported international action aiming at stability of markets during periods of wheat scarcity, and continues to support such policies now when wheat is in ample supply. Some of Australia's competitors have at times adopted selling policies out of line with normal commercial practices and the comparative cost of producing wheat. Those nations signing the agreement formally subscribed to its objectives of price stability and equitable marketing. . A valuable feature of the discussions preceding the agreement is that the administrative machinery of the agreement has provided a suitable and convenient forum for the discussion of problems in the world wheat trade experienced by both exporters and importers.

This agreement, as all members of the House will know, is basically a trading agreement. The problems of surpluses and the production policies of individual countries are indirectly rather than directly affected by it. I hope that discussions between the member nations and with the United Kingdom will continue at appropriate times. I am very pleased to see that provision is made in the International Wheat Agreement for discussions such as these. Article XIII., sub-section 7 (a), of the agreement reads -

The Council may study any aspect of the world wheat situation and may sponsor exchanges of information and inter-governmental consultations relating thereto . . .

I believe that Australia as an efficient producer of low-cost wheat will' be vitally interested in such discussions as are allowed under this agreement. I hope that some constructive action will emerge from them. I support the bill.







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