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Wednesday, 27 November 1985
Page: 2423


Senator BOSWELL(10.42) —Tonight I wish to discuss the report that came down today recommending the removal of the subsidy arrangement on phosphatic and nitrogenous fertilisers. The report recommends that the subsidy arrangement should cease on 30 June 1986, when all the bounties on these fertilisers will be lifted. The National Party of Australia is prepared to support the removal of the subsidy if steps are taken in other areas to lift the restrictions and regulations which raise unnecessarily the cost of fertilisers. Last year the subsidy amounted to $12 a tonne for phosphatic fertilisers and $20 a tonne for nitrogenous fertilisers. If these subsidies were removed, it would cost the average farmer over $55m a year. In particular, cane farmers in Queensland would be severely hit. Currently, they use over 30 per cent of all nitrogenous fertilisers in Australia. Farmers in Queensland overall use 45 per cent of all fertilisers. We all know that Queensland cane farmers are going through a very tough stage. They are fighting for their very survival and they need a lift in the cost of fertilisers like they need a hole in the head.

The report gives some fairly sound reasons why the subsidy should be removed but, as I often pointed out to Senator Grimes-I do not seem to be able to get through to him; there are none so blind as those who will not see-the average farmer pays $13,000 a year in tariff protection to protect the jobs of city people. I will continue to say that at every opportunity I get. It is unfair that farmers, who receive precious little government assistance, and very little since this Government has ripped it all off them, are asked to bear this burden when the Government could reduce fertiliser costs if some of the unnecessary costs were removed.

I refer particularly to the anti-dumping levy placed on imported fertilisers and the prohibitive shipping costs caused by the Government giving the Australian National Line the monopoly of transporting unprocessed phosphate from Christmas Island. In 1970 the Government imposed a levy of $70 to $80 a tonne on imported fertilisers because it was suspected that multinationals were dumping excess fertilisers on the Australian market and unfairly under cutting the local producers. It is 15 years down the track and, if any dumping on the Australian market were going on, one would think it would have been sorted out by now. In the meantime the Australian fertiliser industry has been reduced by 50 per cent. So the levy has not done the industry much good. Surely this anti-dumping levy is no longer justified. It is time the Australian farmers, who ultimately have to pay this levy, were relieved of this cost. When there is no evidence of dumping, as is the case at present, there is no justification for an anti-dumping levy.

The second unnecessary cost comes from the ANL's monopoly on sea transport of phosphate from Christmas Island to Australia. It is estimated that if the monopoly were removed, the price of fertilisers would fall by $17 a tonne. ANL is protected from the rigours of competition by its agreement with the Australian Government allowing it to be the sole carrier of phosphate into Australia. The inbound freight rate for bulk carriers into Australia is extremely competitive because of the relatively low levels of bulk cargo coming into Australia and the high levels going out-cargoes such as wheat, coal and sugar. Foreign vessels coming into Australia to pick up our bulk cargoes of primary products are desperate for any sort of incoming cargo. It is immeasurably cheaper coming in than going out.

There is no doubt that if these three measures were taken together-the removal of subsidies, the removal of the anti-dumping levy and the removal of ANL's transport monopoly-the cost of fertilisers to farmers would fall. The National Party and the Liberal Party of Australia are not being unreasonable in calling for these measures. If one is to remove a government mechanism which decreases farmers' costs it is entirely fair that one should remove the government mechanism that increases farmers' costs. Taken on its own, the National Party cannot support the recommendation to lift protection from Australian fertiliser manufacturers. However, if it were accompanied by the other two steps we would support the recommendation.