An Australian farmers opinion

[gustgd]

As some of you know we have had Australian workers do working holidays on our farm for many years now.

Last night a Aussie farm friend sent me a question about my opinion on markets. I shared with him information worth about as much as he paid for it.

On the end of my reply I asked him the question.
"Question for you. When the AWB was in its wrap up stage, was the earth salted by outgoing directors and management? With a destiny to fail.

Or did it have a good chance, and just didn't have what it takes in a low margin high volume business? "

[gustgd]

and this was his reply


"When AWB finally wrapped basically only when cargill took them over and still alot of same faces and management but many went into private companies as well.

We had semi deregulation ie licensed exporters that had to be approved, i think back in was it 2006 there were 8 next year 12 then another couple each year until it was finally true open market in 2011.

Domestic wheat was deregulated back in maybe 1998/1999 not sure so when the writing was on the wall it was just business as usual they slipped into whatever market system was prevailing at the time,they didn't fight tooth and nail basically because they knew they were stuffed with Iran weapons scandal, and semi deregulation anyway so they didn't even fight,they chose to compete and compete well in a open market which they have done. Now with cargill takeover the awb/cargill has a far bigger balance sheet to offer cash prices better and in cargills case first time ever for pools via awb and there experience.

Sure there was some farmer reluctance and a few rallys etc but all passed without a wimper, and honestly most of the pro single deskers are used to the new markets only the single desk radicals wish for the old days.

But one thing many were not ready for was huge market swings up and down sometimes over a weekly period but moreso monthly,but im sure nothing worse than you canadians get with open canola market."


and then a few minuets later he added.

"i guess i guess its a different scenario for you guys we had buyer galore as mentioned in previous email awb were part of that wereas cwb had it all to themselves so its different.

Also awb had storage and handling acrooss australia so were well placed to compete"

[stubblejumper]

one huge difference was that a majority of producers voted to end the AWB.

[Tom4Wildrose]

Stubble,

Do you live on a different planet?

The Aussie government ended the monopoly just like our Conservatives are doing right now.

Have you forgotten Sadam/'Food for Oil' and all the corruption and disgrace at the AWB... already?

[malleefarmer]

basically right but stubble there was never a vote a few polls etc here and there always came up about the same 50% for and against.

i was involved in mostly barley debate and meetings with politicians etc and met with both sides of parliment ag ministers and they both agreed if left to farmers a decision will never be made.

another thing going in australia at the time was federal govt was giving the states a "competition payment" if a raft of industries and services if competition was allowed ,went from farming,chemists bulding industries literally 100s of things had to be deregulated to achieve this payment worth milions and millions to the state and grain marketing was one of things that had to change and market opened up,so it was in the best interest of the govt to help the pro change side anyway they could.

Eventually it happened, and actually seems your changes in canada are going to happen far more swiftly than our did in aust, took us about 8 to 10 yrs.

The only monopoly we have left in aust farm wise is vetrra own all the ports in sa and wacbh in the west and grain corp in the east, but that has been broken to a extent this week a company called emerald grain has bought the port of melbourne plus rail network to provide a alternate source of storage and handling.