Work needed for Asia to last
The leaders of two Australian grain export businesses told the 2013 Australian Grains Industry Conference that Australia has work to do to ensure the long-term opportunity presented by the growing Asian grains market was realised.
In a panel discussion at the conference, Emerald Grain chief executive officer John Murray and Plum Grove managing director Andrew Young said more industry collaboration and a much greater engagement with customers were still needed.
Mr Murray said that while Australia was a trusted and reliable producer of high-quality food, the grains industry, collectively, was not doing enough to add value: “We need to be doing more research and development on new grain varieties and find new niche products [for the Asian market].”
Mr Young said it was also important to engage customers in investment opportunities that existed along the supply chain.
“The customer has a genuine interest in seeing the Australian grains industry behave in a profitable way. But have we given the customer enough confidence about what’s going to happen in the future in terms of meeting their supply requirements?” Mr Young asked.
Mr Murray said there was concern that Australian grain productivity had stagnated at a time when Australia needed to increase its grain supply to produce the varieties and quantities customers wanted. If this did not happen, buyers would look elsewhere to meet the growing demand for grains.
“We need a cohesive and comprehensive strategic plan to ensure growers improve their profitability and remain viable because, in the end, unless they are viable we don’t have an industry,” he said.
Both Mr Young and Mr Murray said additional port infrastructure was needed to speed up the time it takes to get grain to market, but they questioned whether this would lead to over-investment while other infrastructure was in decline.
On the east coast, Mr Murray said the rail system in some areas was appalling and needed significant investment from government and business.
“Rail is absolutely vital to the long-term competitive position of Australia grain,” he said.
In Western Australia, Mr Young said CBH’s investment in trains had reduced costs for growers, but he felt government also had a responsibility to maintain essential infrastructure.
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