The Australian Competition and Consumer Commission (ACCC) is recommending the Federal Government does away with the Port Terminal Access code of conduct when it next comes up for review, saying it is no longer fit for purpose.
The port access code, applied to bulk grain exporting ports, is due to expire on October 24 next year.
The code was set up in the wake of the deregulation of wheat exports primarily to ensure that the big three grain port operators, GrainCorp, CBH and Viterra did not exert undue influence over the market.
However, with a host more competitors on the east coast and a number of exemptions to the code the ACCC felt it was no longer doing the job it was set up to do.
"The market for bulk grain export port terminal services has changed significantly since the code was brought in."
In its submission paper to the government which is conducting its second review into the code, the ACCC said the code as it currently stood, rather than increasing competition, could actually act as a impediment to new port providers entering the market.
It also said there was a flaw in the code in that it lacked clear and enforceable obligations for those operating under its auspices.
The code was implemented in 2014 and the ACCC said now there were a number of competitors to the Big 3, with smaller operators setting up lower cost operations, utilising equipment such as mobile ship loaders.
This has led to a marked increase in the number of port operators in a range of different port zones.
However the ACCC submission highlighted that a small number of large vertically integrated service providers, offering companies that provide bulk grain storage, handling and port terminal services, continue to handle and export most of the bulk grain exported from Australia.
It also acknowledged that the level of market concentration and vertical integration in Australian bulk grain exports may give rise to competition concerns, but it said that industry participants were best placed to comment on the impact of the code, both positive and negative, and whether it remains necessary.
Gregor Heard
Gregor Heard is ACM's national grains industry reporter, based in Horsham, Victoria. He has a wealth of knowledge surrounding the cropping sector through his 15 years in the role. Prior to that he was with the Fairfax network as a reporter with Stock & Land. Some of the major issues he has reported on during his time with the company include the deregulation of the export wheat market, the introduction of genetically modified crops and the fight to protect growers better from grain trader insolvencies. Still involved with the family farm he is passionate about rural Australia and its people and hopes to use his role to act as an advocate for those involved in the grain sector.
Gregor Heard is ACM's national grains industry reporter, based in Horsham, Victoria. He has a wealth of knowledge surrounding the cropping sector through his 15 years in the role. Prior to that he was with the Fairfax network as a reporter with Stock & Land. Some of the major issues he has reported on during his time with the company include the deregulation of the export wheat market, the introduction of genetically modified crops and the fight to protect growers better from grain trader insolvencies. Still involved with the family farm he is passionate about rural Australia and its people and hopes to use his role to act as an advocate for those involved in the grain sector.
