Grains Research and Development

Date: 01.06.2002

Grains Week: the industry and the future

Wheat

The public forum of Grains Week 2002, held in Melbourne, offered a stimulating smorgasbord of themes and issues - all of them urgent to the contemporary grains industry. A roster of industry and research leaders outlined some agenda items for 2002-03. These include grains market outlooks and mechanisms (read 'single desk' marketing or otherwise for Australia); briefings on the 'swings and roundabouts' of world trade politics; and explorations of a host of thorny issues starting with 'change' and featuring: GMOs, intellectual property, the drying-up or sideways shift in public funding for research, R&D direction, as well as some probing questions about the fundamental economics (or otherwise) of farming in the Australian environment.

Outstanding addresses were given on research themes, creating a new optimism for the industry among many farmers in the audience. These will be covered in the next edition of Ground Cover. On these pages Ground Cover brings you some food for thought from several key Grains Week Industry Forum speakers addressing market and political issues.

Food from thought'

GRAI NS COUNCIL of Australia President Keith Perrett's keynote speech ' Food from Thought ' revolved around the theme of global and national factors that are requiring the grains industry to change, to adapt and 'farm smarter' while sustaining the resource base. Mr Perrett also had some comments on influences that the Grains Council of Australia (GCA) dealt with in the past year. Here are some excerpts.

On National Competition Policy

The GCA's position is th at, while National Competition Policy (NCP) may be beneficial in developing an efficient Australian economy, we are deeply concerned that the fundamental objective of NCP of enhancing community welfare may be forgotten in its implementation.

On the Wheat Export Authority

The Minister for Agriculture, Fisheries and Forestry, the Hon. Warren Truss, has asked the GCA to consider the funding of the EXCERPTS FROM: Authority beyond 2003. I acknowledge that the wheat growers of Australia have overwhelmingly indicated their desire for the maintenance of the ' single desk' because of the benefits that it brings.

The benefits, however, are not confined to growers - others also benefit. Accordingly, in recognition of this broader distribution of the benefits, the GCA believes the Government should be making a contribution. It must also be remembered that it was growers who provided the initial $6 million to fund the establishment and operations of the WEA.

Other 'single desk' arrangements

The various state-based marketers of other Australian grain products also have ' single desk' powers.

I believe it is important that these arrangements are kept in place to ensure the reputation for producing and selling consistent, high-quality products that Australian grain enjoys in export markets is maintained .. . There a re now some signs that the weakening of those arrangements is having an adverse impact on Australia's reputation for quality product. A number of concerns have been expressed about falling standards for barley under the deregulated Victorian market and the potential for this to have a detrimental effect on Australia's market acceptance. (See, for example, analysis of China barley trade provided by Trevor Day from the Australian Grain Marketing Federation, next page.)

Trade - WTO and US Farm Bill

The reason we are so concerned about the single export desks is the vital part that exports play in our industry. In a situation where the world market for grains is distorted by production and export subsidies, it is critical to growers' interests that our marketing bodies are able to compete strongly while, at the same time, the industry works with government to reduce the market distortions. The WTO Ministerial Meeting in Doha at the end of 2001 resulted in agreement to launch a new round of multilateraltrade negotiations ... with a view to phasing out export subsidies (and other) trade-distorting domestic support.

(At the same time) the US Farm Bill for the next 10 years was recently debated and passed in the US Congress. (See discussion of the US' backwards movement on domestic price supports in Brendan Stewart 's AWB report to graingrowers, this page.)

While GCA expects considerable pressure will be placed on ' single desk' marketing arrangements during the (present round of WTO) negotiations, we believe we can clearly demonstrate that the ' single desk' arrangement does not distort the marketplace. In stead it works to maximise grower returns in an environment depressed by massive government support in other exporting nations. The ' single desk' arrangements cannot be a bargaining chip in any trade negotiations.