The ACCC’s monitoring report of bulk wheat ports for the 2019-20 shipping year has found grain growers and exporters raised few concerns about port terminal access, due to low Australian grain production as a result of extended drought conditions.
The report identifies that 2019-20 was the lowest year of grain production and bulk grain exports since the ACCC began collecting grains data in 2011. As a result of low production, overland transport and coastal shipments increased to satisfy domestic demand in drought-affected Queensland and New South Wales.
While the three major port terminal service providers, CBH, Viterra and GrainCorp, remained the dominant providers of port terminal services in 2019-20, and each has a major affiliated wheat export operation, other independent exporters raised few concerns about access to port terminal services due to low production and export volumes.
“We note that in most regions there is excess port capacity in low export and drought years, and with new facilities commissioned in some ports, we will not be revisiting any exemption decisions at this stage,” ACCC Deputy Chair Mick Keogh said.
“However, improved conditions during 2020 have significantly increased production across most major grain growing regions, and last season’s harvest is one of the biggest on record.”
“Exporters are already reporting that port terminal services in most regions are fully booked throughout the peak exporting period this year, and are likely operating at capacity. We therefore expect the 2020-21 shipping season will provide a more significant test of whether port terminal service providers meet the expectations of exporters,” Mr Keogh said.
The report also reiterates the ACCC’s support for a range of amendments to the Wheat Port Access Code that would improve the ability of exporters to have fair and transparent access to port terminal services.
“We welcome the Australian Government’s support to implement several recommendations made in the Department of Agriculture’s review of the code as these changes will benefit industry, including growers as they seek a fair price for their grain,” Mr Keogh said.
“But there is still more work to be done, including expanding the code’s coverage from wheat to all bulk export grains at port.”
The report shows that the proportion of non-wheat grain being shipped has been increasing since the 2011-12 season. While wheat still makes up the majority of grain exports overall, at several ports wheat is no longer the major export grain by tonnage, and it is important that exporters of other grains obtain equitable access to port terminal services.
The ACCC monitors and enforces compliance with the Port Terminal Access (Bulk Wheat) Code of Conduct, and also has certain specific roles in relation to port terminal exemptions and capacity allocation systems. The code regulates the conduct of port terminal service providers to ensure that exporters of bulk wheat have fair and transparent access to port terminal services.
The bulk grain ports monitoring report, now in its fifth year, examines data on the nature and concentration of export activity across Australia’s bulk grain port terminals, and also presents views from industry consultation with growers, exporters, and port terminal service providers.
The ACCC undertakes monitoring of bulk wheat port terminal services to assess the level of competition at both exempt and non-exempt facilities. Exempt port terminal service providers are not required to comply with certain provisions of the code.