ACCC approves grain access deal

ACCC approves deal to ensure "fair and transparent" access to grain ports operated by the country’s three major grain exporters

September 30, 2009

The Australian Competition and Consumer Commission (ACCC) has approved a deal which it says will ensure "fair and transparent" access to grain ports operated by the country’s three major grain exporters.

The agreement will prevent Co-operative Bulk Handling (CBH), GrainCorp and Viterra-owned ABB Grain discriminating in favour of their own wheat business by allowing the ACCC to order independent audits of each port operator’s compliance with non-discrimination obligations.

These obligations include transparent port loading protocols when managing demand for the port terminal service and the duty to negotiate in good faith with eligible wheat exporters around price and non price offers of access to terminal services.

Smaller wheat exporters will also be able to seek mediation or binding arbitration on price and non-price offers of access to port terminal services, should such negotiation fail.

The three companies will also be forced to publish terminal information in order to provide the ACCC with greater transparency over their operations.

"The access arrangements will unlock constraints at grain ports, to the benefit of the overall Australian economy," an ACCC statement says.

"They will promote the development of a wheat export marketing industry that is efficient, competitive and advances the needs of wheat growers."

Two previous attempts by Co-operative Bulk Handling (CBH), GrainCorp and Viterra-owned ABB Grain to have access arrangements approved at their ports had already been shut down by the ACCC.

The access arrangement needed to be approved by the ACCC before October 1 to ensure the companies retained accreditation with Wheat Exports Australia (WEA) to export wheat beyond this date.

Statements from the various companies expressed relief at the national watchdog’s decision, which was undertaken after extensive consultation with port operators, farm groups and the general wheat groups.

"We are pleased the ACCC has acknowledged our ability and intent to provide fair and equitable access to all port users," CBH Group CEO Andrew Crane says.

"We have dedicated a vast amount of time and resources to working through this process with the ACCC and we have worked rapidly over the past month to understand and address the concerns raised in their first draft decision."

Viterra Chief Operating Officer Fran Malecha says the decision will now assure all stakeholders in the grain industry of an equal playing ground.

"We believe this should provide both growers and marketers with full confidence that ABB Grain is operating our ports with the intent of maximising throughput for the benefit of all parties," Malecha says.

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