Aust Loses $2m Wheat Sale To Nz
Sydney Morning Herald
Friday May 19, 1989
Australia has lost $2 million worth of wheat sales to New Zealand following the failure of the Australian Wheat Board to urgently find sufficient trans-Tasman shipping space to supply the order.
United States grain traders have filled the 9,000-tonne order with non-subsidised grain which, according to industry sources, was shipped to NZ for at least $10 a tonne less in freight charges than Australian exporters could do it for.
Australian-based grain traders claimed yesterday that the lost sale had"internationally embarrased" the Australian Wheat Board (AWB), which has consistently complained that it was unable to compete with the US due to that country's wheat subsidies.
"It's also an indictment on the Federal Government for failing to bring down freight charges across the Tasman, which are kept artificially high because of union agreements," said one prominent trader.
The AWB's deputy general manager, Mr Ron Storey, admitted yesterday that the board had been "frustrated" by the sale into a market that has traditionally been supplied by Australian wheat.
The NZ market is worth about $24 million a year.
Mr Storey said the board had been unable to organise a foreign shipping company to export the wheat after it had become apparent that there were no Australian vessels available.
The trans-Tasman union agreement prevents the use of non-Australian or New Zealand ships to export products between the two countries, although the unions at times agree to waive the agreement in urgent cases.
Mr Storey said the board had spent several days trying to contact the six relevant unions to agree to a waiver. The unions had eventually agreed to allow the board to use a non-Australian vessel but by that time the order had already been filled by the US traders.
The Herald was unable to contact representatives from the Seamen's Union, the main union involved in the incident.
However, it is understood that the ACTU and the maritime unions are considering relaxing the trans-Tasman agreement to prevent Australian losing further trade to NZ.
"The trans-Tasman freight agreement is eroding our ability to compete in NZ," Mr Storey said.
"I'm not bashing the unions because they eventually agreed to the waiver and in fact helped us to obtain it but the problem was that it took so long... that we lost the order."
The deputy director of the Grains Council of Australia, Mr Mitch Hooke, said the incident was another example of wheat growers suffering because of restrictive union agreements.
The Federal Opposition's spokesman on industrial relations, Mr Reith, has this week vowed to take on the union movement to break down such agreements if the Coalition wins office at the next election.
The incident, which occured in the middle of April, is the second time in two months that Australia has lost sales to New Zealand in the past two months.
In late March, Turkey sold about 20,000 tonnes of wheat to New Zealand after it had purchased 750,000 tonnes of subsidised wheat from the US.
The second NZ order, which the board lost, had been prompted by the requirement of NZ millers to import some lower-quality wheat to blend with the Turkish wheat.
© 1989 Sydney Morning Herald