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Tuesday, 23 June 2009
Page: 4081


Senator NASH (7:09 PM) —I rise to make some comments tonight on what is the first anniversary of the end of the single desk wheat export marketing system. I do so with a great deal of sadness, because it was a very difficult time last year for growers around this country when Labor decided to deregulate the single desk.

For years and years, our wheat growers had relied upon the orderly marketing of wheat. They had relied upon the fact that there was a national pool in which they had confidence and which they knew was going to underpin not only the wheat market but also many others. Unfortunately, the Rudd government saw fit to end those marketing arrangements. I think it is quite extraordinary that they did so, given that they constantly talk about the ills of deregulation. Yet last year we saw exactly that—namely, the deregulation of the wheat industry.

We saw today dozens of wheat growers converge on Canberra to mark the anniversary of the end of the single desk. I find it extraordinary that, a whole year after the change in arrangements, these growers are still so incredibly and deeply concerned about the changes that have been made and the impact on their industry. People like Jock Munro and Mark Hoskinson have done an incredible job making sure that this issue stays front and centre, because it is such an enormously important issue for these growers.

What did the government do? It took away one of the few things that were underpinning confidence in the future of the industry. It completely disregarded it and took it away. The minister at the time, Minister Burke, actually said that it was a major economic reform. I cannot think of anything more inaptly labelled than calling the deregulation of the wheat industry a major economic reform, because it simply was not. It has had the opposite effect of making things far worse for wheat growers.

It is very interesting, from a trade point of view, to look back to when we did have a single desk wheat export marketing system. We were constantly hearing from the United States that we had to get rid of this single desk system because it was unfair. Basically they were saying it was giving us an unfair advantage. What did the Rudd government do? It turned around and got rid of it—one of the few things that were giving some stability and sustainability to the wheat industry. It has resulted in the wheat growers carrying a great deal more risk. It used to be carried by the single desk national pool and the wheat marketing system but now that risk has been transferred to growers. These are growers that are dealing with years of drought and years of financial hardship and now this shift in risk is yet another thing they have to contend with.

It was obviously a very heated issue at the time. Growers are now paying the penalty for something that was not of their making. Around the time, there were some actions and inactions taken by staff at AWB that led to a whole chain of events, but growers are not the responsible party here. Growers are not the ones who should have to bear the brunt of this decision. The uncertainty that it is causing throughout the wheat industry is really significant.

I had one of the growers say to me this morning that they are now the grower, the marketer and the transporter looking after the logistics. These people are very time-poor. They are flat out running their farms and making ends meet and they now have to occupy all of those roles as well. There was simply no need to put them in this position, because the single desk marketing system was working very well for these growers.

An enormous percentage of these growers wanted the single desk to stay. We talk about a democratic country, about how we live in a democracy and about how it should be about what people really see as the best way forward through our democratic system, yet the majority of growers were simply ignored by the Rudd Labor government. The complete disconnect of the Rudd Labor government from regional Australia that continues day after day after day is quite extraordinary, because they simply do not understand the effects their decisions are having on our regional communities and our agricultural community.

Growers have now been placed in this position where the market stability and price security they had before are gone. With a national pool, that stability and security were there. There was the receiver of last resort. Growers knew that they were going to be able to get rid of their wheat. Now they are caught in this system where from one day to the next through a harvest there is absolutely no certainty whatsoever.

It is quite interesting that we have not yet seen a harvest that is going to cause a glut in the market. We have no idea of the impact this is going to have when we really have a big harvest across this country. If last September we had seen the rain we were hoping was going to come, from the Lachlan to the Eyre Peninsula, it would have been even more difficult for our growers to cope, because that flooding of the system would simply have made it even more difficult.

There have been a number of reports, as well, about wheat being wrongly graded by traders, and this comes back to the confidence in Australia being able to produce a consistently excellent grade of wheat. Our longstanding reputation is diminishing. We are getting reports back that the quality of the wheat simply is not there, and there is no quality assurance. There are no guarantees. That reputation that was so hard won over decades and decades of hard work by our farmers and by the utilisation of the single-desk system is simply disappearing.

There are the issues with access to port that we have seen. In February, there were even international reports of Australian wheat exporters facing delays of up to five weeks at ports as 22 grain traders jostled for shipping bookings after the best harvest in three years. We had reports back of 16-hour queues for growers to have their grain unloaded. That cost is coming back to the farmers. It is not on the traders; it is coming back to the farmers and their ability to access port, which is completely diminishing and disintegrating.

The whole system is a mess, and it was entirely unnecessary. The Rudd Labor government did not have to make the decision to remove that single desk system. I have received a letter from a grower today, which I will just read for my colleagues in the chamber and which noted a number of areas:

The destruction of the national pool by the Rudd Labor government has resulted in approximately $1.2 billion missing from wheat cheques across the wheat belt of this nation. Supply chain dysfunction has included apparent third line forcing, leaving little or no meaningful competition at various sites and across some port zones. In the east wheat belt of this nation, this supply chain dysfunction has resulted in the east-west basis having inverted trade at a $30 to $45 discount to the same day grade in the west. It is not, as Minister Burke represented, that Western Australian wheat growers have achieved this much improvement in their wheat price, as in reality it is the eastern wheat growers being discounted by the dysfunctional supply chain, lacking the wholesale negotiator role previously provided by the national pool.

This is just a taste of the type of letters, emails and calls I have been getting from growers for a long time now.

The Rudd government is continuing to punish wheat growers—there is no doubt about that—and it was simply unnecessary. We had dozens and dozens of wheat growers here today because they know that this system needs to be changed, they know that deregulation is not working and they know that they need to have an orderly marketing system so that they can have some confidence and so that this industry can have some sustainability into the future. The Nationals will absolutely keep supporting those growers, as we did last year. It was a bit like David and Goliath, I have to say, because we were the only ones out there supporting these wheat growers. There are many people in this chamber and in the other place who know that the wrong decision was taken, and we will be working very closely with those wheat growers to do all we can to make sure that we have a sustainable future for the wheat industry in this country.