Grains Council comments on long-term capacity

On September 1, the WAFarmers Grains Section made a submission to the Australian Competition and Consumer Commission (ACCC) regarding Co-operative Bulk Handling’s (CBH’s) proposed changes to their long term capacity allocation process.

Two staff members from CBH joined a teleconference with the Grains Council to provide details of their proposal to the ACCC, requesting amendment to its undertaking which gives exporters greater assurance for grain capacity.

WAFarmers Grains Council supported the application as being sufficiently clear and transparent in term of allocating long term agreement (LTA) capacity should it be oversubscribed. The additional amendments provide CBH with some flexibility in managing congestion, and believes it has considered as best as possible, the views from its customers in order to promote efficiency in the future operations of its facility.

WAFarmers Grains Council also agreed that the proposed allocation method (for example using historical exports of customers) considers the interests of different industry participants.

Smaller or new exporters have a sufficient opportunity to obtain capacity. The LTA process has enabled the entry of new customers previously unable to export from Western Australia and secure capacity through the auction process, and these customers have been allowed entry without previous historical records. This provides a good opportunity for new entrants as well as existing customers to increase and decrease their market share accordingly.

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