growing discontent

Growing discontent

It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.

February 11, 2006

The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Growing discontent
Email Print Normal font Large font It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.
Photo: Andrew Taylor
Advertisement
AdvertisementFebruary 11, 2006
Page 1 of 3 | Single page
The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Growing discontent
Email Print Normal font Large font It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.
Photo: Andrew Taylor
Advertisement
AdvertisementFebruary 11, 2006
Page 1 of 3 | Single page
The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Growing discontent
Email Print Normal font Large font It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.
Photo: Andrew Taylor
Advertisement
AdvertisementFebruary 11, 2006
Page 1 of 3 | Single page
The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Growing discontent
Email Print Normal font Large font It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.
Photo: Andrew Taylor
Advertisement
AdvertisementFebruary 11, 2006
Page 1 of 3 | Single page
The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Growing discontent
Email Print Normal font Large font It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.
Photo: Andrew Taylor
Advertisement
AdvertisementFebruary 11, 2006
Page 1 of 3 | Single page
The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Growing discontent
Email Print Normal font Large font It's about getting the right price … Chris Kellock surveys the situation from wheat stubble on his property near Yarrawonga.
Photo: Andrew Taylor
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The wheat scandal has spurred on farmers in their fight against the AWB's monopoly, writes Matthew Moore.

EARLY this week a handful of farmers from NSW and Victoria travelled to the city for the simple pleasure of watching another wheat board executive squirm.

While the discomfort of those sweating before the Cole inquiry was reason enough to make the trip, this group had more ambitious plans.

Each of those who were present hates the AWB's monopoly on selling Australian wheat overseas, and believes now is the time to do something about it. After lunch, they disappeared around the corner from Commissioner Terence Cole's hearing room in Sydney's Market Street, and sat down in a rented office for the first formal meeting of a new group committed to ending the "single desk", as AWB's monopoly on international sales is known.

The group is so new it doesn't yet have a name, or more than a few dozen members, but the ideas they are advocating have been around since 1999 and seem to be gathering momentum. It's six years since the Government privatised the statutory authority called the Australian Wheat Board, turned it into the AWB, a company owned and controlled by the growers that was floated on the stock exchange two years later.

At the meeting was Chris Kellock, who grows 1000 hectares of wheat at Yarrawonga, near the NSW-Victoria border. He says he could get more money for his crop if companies could compete to buy it. Private grain traders can buy wheat for sale in Australia, but wheat destined for international sales must go into a pool which is controlled by AWB, thanks to a federal law that guarantees its monopoly.

Kellock says the lack of competition has led to a bloated and inefficient bureaucracy within AWB where growers must take whatever prices management negotiates, minus a range of charges he says are excessive.

"Wheat growers have become a cash cow for AWB," he complains.

Deregulation has been spreading through the agricultural sector with monopoly marketing authorities largely gone for crops like barley, canola, sugar and cotton. A mix of traders, growers and some politicians believe wheat is no different.

"We deal with [traders] Louis Dreyfus and Cargill with our barley and canola and they are very good to deal with," Kellock says.

He expects his group to expand fast and plans to attend AWB's annual general meeting in Melbourne in a fortnight to gather support from farmers appalled at the kickback revelations, which on Thursday forced the resignation of the company's managing director, Andrew Lindberg.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.

Kellock's group has already got the backing of Australia's biggest wheat farmer, Ron Greentree, who supported the single desk when the wheat board was a statutory authority. He now condemns AWB as unaccountable to growers because "there's no competition and no transparency" and no value for farmers.

"There used to be a couple of blokes who chartered ships to export wheat, now the AWB has made it a profit centre - they make $26 million for chartering," he says.

To justify its monopoly AWB has commissioned studies which show farmers get as much as $13 a tonne more for their wheat because of the marketing clout the single desk gives them. Greentree is sceptical and says plenty of other reports show the monopoly costs growers money - that much or more.

"The only time the AWB can prove it [the financial benefit] is when they pay the consultants themselves."

With the Cole inquiry eating into their credibility, AWB directors have gone to ground and refuse to mount a public defence of the one desk system. Even the Grains Council of Australia, which represents 30,000 grain farmers and receives some funding from AWB, is too spooked to argue a position for fear it will alienate farmers toying with deregulation. Instead it has issued statements saying "it's a matter for industry and government" to decide what happens, and lamely reassuring farmers the fallout from the Cole inquiry will not affect their sales.

Many smaller farmers, such as Jock Munro at Rankin Springs in NSW, are not convinced and fear AWB will be so scrutinised it will not be able to serve farmers. "It's going to be so damaging … the AWB will be stuffed," he says.

Munro is a strong supporter of the single desk and is convinced that any easing of the monopoly will see the traders play one small farmer off against another and drive the price down. He regrets the Howard Government established the inquiry when it should simply have left AWB to do business as usual.

"The AWB is well run. They were determined to sell wheat. Like it or not that's what they were doing."

In this uncertain time, Munro fears the Liberal Party may force deregulation on AWB and the Nationals won't stand up to them.

"The Libs are so market-oriented they would privatise their grandmothers," he says.

A former National Farmers Federation president, Graham Blight, says while farmers such as Greentree could do well in a deregulated system because of their size and their location to markets, for others it would be a disaster, especially in the more marginal country.

"There would be all sorts of dramatic effects; land values would fall, wheat prices would fall, everything starts to fall to pieces."

Deregulation would probably drive small farmers out of business and further cut into rural communities.

"Why would politicians do it, because it's not going to change the price of a loaf of bread."

The leader of the National Party, Mark Vaile, has insisted the single desk will stay, although the Agriculture Minister, Peter McGauran, appeared less wedded to it when he said "it's hard to see the status quo prevailing post-Cole".

Despite their conflicting views on the merit of deregulation, both sides believe the issue may decide the future of the Nationals. Greentree says the Nationals' agreement to the sale of the remainder of Telstra means the single desk is "all they've got left to show they are different".

Blight says the Nationals are fighting for their life on this issue.

"If they give this away, I really think they have a big problem because a lot of people are looking to them to protect our interests. This is their platform, this is the main reason they exist. If they give up this fight, then what's the point?" he says.