NSW Farmers call for Australian Competition and Consumer Commission investigation into grain pricing

Australia’s largest state farm body has called for an inquiry into grain pricing in Australia, throwing accusations at traders. See the latest.

NSW Farmers say growers are questioning whether they have lost about 30 per cent of their pay cheques through heavy discounting of prices in international markets.

The state farm lobby group’s vice-president Xavier Martin said the Australian Competition and Consumer Commission should investigate the big disparity between what Australian growers were being paid for their canola, wheat and barley compared with their counterparts in North America.

Mr Martin said Japanese customers were paying $1400 a tonne for Canadian canola when the price in Australia was $900 a tonne delivered to Geelong or Newcastle.

“Farmers are saying prices that were $40, $60 or 80 a tonne out was bad enough, but when it gets to hundreds of dollars, questions are being asked of what the hell is going on?” he said.

“When they look at what customers are paying for their grain in Japan or Egypt or wherever and translate that back to farm gate prices, the question is: who is getting away with 30 per cent or more of that cheque?”

Grain Producers Australia and Grain Growers Limited have been pushing for an ACCC inquiry during the Federal election campaign.

GPA chief executive Colin Bettles said pricing disparity between local and international markets remained the number 1 issue for grain growers.

“The problem is the market has not been analysed properly since the market was deregulated,” Mr Bettles said.

Thomas Elder Markets analyst Andrew Whitelaw said farmgate grain prices in Australia last year were “the lowest prices in the world”.

The basis — the gap between international and Australian prices — was generally lowest after Australia produced big grain crops.

But Mr Whitelaw said wheat for the next season was still heavily discounted against US prices.

Australian Bureau of Statistics data acquired by The Weekly Times shows Australian traders exported 23.5 million tonnes of wheat in 2020-21, slightly less than the record 24.1 million tonnes shipped in 2011-12.

Price discounting by grain traders operating from Australia is evident by the number of African countries — generally considered low paying customers — buying local wheat.

Last year, Mozambique, Uganda, Malawi, Rwanda and Madagascar bought Australian wheat for the first time since at least 2016-17 when Australia last had a big crop to sell.