Agribusiness accuses WA network operator of forcing the move
A short term rail deal covering Western Australian grain logistics has been signed but the outcome has left one partner unhappy about the process.
Unless extended, the interim agreement between freight rail network operator Brookfield and agribusiness CBH under the State’s Railways (Access) Code 2000 is due to expire on December 31.
The deal comes after months of negotiations and years of rural concern that had seen farming demands for State Government intervention unmet.
“This will provide supply chain security and certainty for WA grain growers well into their next harvest and also allows us to concentrate on reaching a sustainable longer term deal with CBH,” Brookfield CEO Paul Larsen says.
“We remain hopeful that both parties will negotiate in good faith to agree a long-term deal by the end of June.”
But CBH Group CEO Dr Andy Crane made no secret of his company’s feeling about the negotiations.
“CBH is extremely disappointed that the situation escalated to the point where trains were stopped. We were backed into a corner by multinational Brookfield Rail,” Crane says.
“We remain of the view that renewing the agreement on like terms until an outcome is reached through the Code process would have been a proper and appropriate outcome.
“Given the peak shipping demand over the next few months, we had no option but to sign this agreement, to protect the international reputation of Western Australia’s grains industry.
“The agreement will see an increase to current rail access costs across the network, expiring on 31 December 2015.
“This is far from an ideal situation for growers and for the state, but if growers can’t get their grain to port it would be irreversibly damaging for the WA grain industry.”
CBH says it is continuing to negotiate a long term access agreement through the Code process and is currently about halfway through a 90-day negotiation period.
“It is critical that the Code process will give us a fair and reasonable long term agreement to secure a sustainable future for WA’s grain industry,” Crane says.
“Moving grain on rail continues to be a major priority for CBH and we will keep battling to make that a long term reality for WA growers, so that they can use this State owned asset in a fair and reasonable manner.
“We are heartened by the ERA’s setting of pricing indicators that we believe show that WA growers are already paying too much for rail access.
“A clear example of this is the fact that eastern state’s counterparts pay significantly less than Western Australian rail access costs. We will continue to fight for a fair go for WA’s grain industry.”