Coulton sounds warning about 60pc Indian chickpea tariff “grief”

But little can be done about the problematic trade barrier to the major export market for now - apart from sounding a warning to producers about revising this season’s planting and marketing programs.

Former Nationals leader Barnaby Joyce used dramatic increases in prices for farm products like chick peas – which he claimed had increased by 800 per cent in his tenure - as a means of claiming political credit.

But India – which Australia has sought to strike a free trade deal with to open further agricultural markets – slapped a 30pc shock tariff on late last year which then increased by 10pc in February and spiked by another 20pc in March, representing an overall increase of 60pc.

Mr Coulton was appointed to the Coalition ministry after Mr Joyce resigned as leader of the Nationals late last month and has identified non-tariff barriers and the Indian chick pea tariff as two areas of immediate concern that he aims to tackle.

“I believe that trade is of benefit to Australia and the people I represent,” he said.

“Australian agriculture feeds three times more people than we have a population for here and if we have protectionism, then trade will cease and the farm sector will be the first to suffer.

“We need to have many markets - I am a believer in spreading out our risk – there are opportunities now and the time is exactly right to rekindle our relationship with the EU post-Brexit, and the UK post-Brexit.

“But one of the great frustrations in my electorate at the moment is the tariffs with India on chick peas.

“We don’t have a (free trade) arrangement with India at the moment and the reason we don’t is because they want to keep agriculture out of it.

“They want to protect their own growers and crops but it’s causing a lot of grief for farmers in my electorate at the moment because they’re at a point where they have to choose their cropping programs, and what they’re going to plant, and they’re running out of time very quickly.

“At the moment the prospects for chick peas look pretty ordinary.”

Mr Coulton said his farmers wanted the tariff situation “fixed up”.

He said new Agriculture and Water Resources Minister David Littleproud’s first job as minister was to hop on a plane and fly to India to speak with his counterparts about the shock tariff increase late last year.

“But quite frankly, they haven’t softened their attitude at all since that time,” he said.

“They don’t have any agreements that they have to comply with, so unfortunately at the moment there’s not a lot we can do - but we definitely want to sort it out.”

Mr Coulton said chickpeas were difficult to grow but had become a very important rotation crop in western NSW, for farmers in his Parkes electorate.

“They are suitable to a dry climate and do a magnificent job in conditioning the soil, they take the disease cycle from cereal crops, they build nitrogen in the soil and they’re a magnificent rotation,” he said.

“But they need to be at a price where it’s economic to grow and at the moment, unless things change or other markets open up, then the prospects for this year are going to be ordinary.

“I’m not giving advice to farmers but they really need to be in close consultation with their grain marketers and have those discussions now because the marketers and traders will have the best handle on where they think they can place this product.”

Rabobank’s March agribusiness update said the 60pc Indian tariff on chickpeas made imports “unviable”.

“But if that doesn’t stem the flow, we can expect further increases to the chick pea tariff, plus there is still room to move on the Indian wheat, field pea and lentil tariffs,” it said.

“A well supplied Indian market with low prices and upcoming elections support desi chick pea prices staying in the low $500AUD/tonne range over the coming nine to 12 months.

“Lentils and field peas can expect similar ongoing pressure over the year.”

Grain Producers Australia Director Andrew Earle returned form a recent overseas trip to India where he and Tony Russell from the Grains Industry Market Access Forum held critical talks about the tariff imposition and impact on local growers.

That program included discussions with Australia’s High Commissioner to India and the pair attended the 2018 Pulses Conclave in New Delhi.

GPA has urged Australian pulse growers to take into account global market changes when considering their 2018 pulse planting program.

“Our visit to India was extremely productive and allowed us to get a much better understanding of the Indian market situation and meet with researchers, industry and government representatives to explore greater opportunities for Australian growers,” he said.

“As a result of the current tariff changes, and India’s pulse surplus and stocks, the market opportunity for Australia will be smaller this year.

“Australian growers need to be aware of this when making planting decisions as we do not want to end up in a situation where we have more pulses than the market can absorb.

“This year will be an opportunity for growers to look at alternative rotational crops to support good practice and reduce disease pressures, in preparation for the 2019 season.”

Mr Earle said GPA recognised the Indian government’s desire to increase local pulse production but he maintained a positive view of the future.

“We believe there is a great opportunity for the two countries to work together and develop a long-term partnership which will be a ‘win-win’ for both countries,” he said.

“A long-term relationship will provide India with a reliable supply of Australia’s high quality, safe pulses when the market requires them.

“It will also allow us to continue to invest in research and development to ensure ongoing product improvement and innovation for our Indian customers.”