Agribusiness & Food, Logistics, Ports & Terminals

Growers concerned over market power in grain supply chain

Port of Brisbane grain terminal. Photo: Port of Brisbane

Australia’s market watchdog has called for changes to regulation in the grain supply chain, after growers expressed concern over access and competition in a recent survey.

The Australian Competition and Consumer Commission recently published the findings of its 2017-18 bulk grain export study.

The report suggests growers are concerned about the fairness and transparency of grain storage, handling and transportation.

It says while Australia has three dominant grain export and supply chain operators – CBH, Viterra and GrainCorp – some regions are only engaged by a single major player.

“We’re troubled that some exporters and growers are still reporting issues in their dealings with service providers at port and along related supply chains,” ACCC deputy chair Mick Keogh said.

“Many of these upcountry supply chain issues are not directly addressed under the existing code.

“The ACCC considers upcountry access issues may be more appropriately dealt with through industry-led reform, or through a market inquiry such as the one currently being sought by growers.”

Keogh suggested that an “appropriately targeted” grains code was vital to ensure supply chain access was fair and transparent for all growers.

“The level of competition in bulk grain port services varies significantly between regions,” he said.

“Some areas have multiple service providers, while other areas remain serviced by vertically integrated near monopolies, particularly in Western Australia and South Australia. Users seem to get very different results in different regions.”

The ACCC’s report, now in its third year, focuses 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 report is available here.

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