gca powerpoint

GCA Policy CouncilWheat Export Marketing Consultative Committee: 

GCA Policy Council Wheat Export Marketing Consultative Committee Held in Canberra Thursday 8th February 2007

Coverage of meeting: 

Coverage of meeting GCA policy position – 6 wheat marketing principles. Shared priorities between GCA members. Overall strategic directions. Industry good functions GCA member organisation positions.

Single Desk Policies: 

Single Desk Policies On February 6th 2007 GCA members agreed that, due to the divergence of views on the form and functions of a single desk… GCA members were not able to provide Grains Council with a unanimously adopted singe desk model. All states agreed that they would Reinforce the unanimously adopted 6 principles Agree on a set of fundamental wheat marketing policy priorities Present their own policies to the WEMCC

GCA Six Principles: 

GCA Six Principles Developed at the GCA Policy Council meeting held over February 8th and 9th 2006 Principles were reaffirmed and expanded at the October 10th and 11th 2006 Policy Council meeting. These principles have been adopted / endorsed by ABB, AWB, CBH and GrainCorp after discussion with senior management Similar to those adopted by the Grain Growers Association

Wheat Export Marketing Principles: 

Wheat Export Marketing Principles Ownership and control by growers of the core element of the wheat export system Security of payment to pool participants Maximisation of net returns to pool participants through the development of efficiencies in the supply chain and development of an advantageous market position for Australian wheat Having the highest levels of governance and transparency to ensure that the system is providing the best possible service and returns to pool participants, The ownership of the ‘single desk’ (the general exemption under the Wheat Marketing Act) should be separated from any organisation providing commercial services to the single desk, Any contractual arrangements for the provision of services between the single desk owner and a commercial service provider should be both transparent and contestable.

Unanimous Common Policy Priorities: 

Unanimous Common Policy Priorities Long term view needed for policy and need to bring growers along with change Some form of regulation of wheat exports Need value chain focus in GCA policy Support for pooling and payment security Need for greater transparency of commercial signals and information across industry Reduction of costs across value chain

Majority Supported Common Priorities: 

Majority Supported Common Priorities General support for a ‘single desk’ – What style, not agreed General support for separation of AWB L and AWB I - No endorsement at this time due to the lack of detail plan being put to ASX and AWB shareholders General agreement of need to remove shareholder conflict of interest General support for Aust Govt to extract value for single desk from trade negotiations No general support for the pre Dec 2006 or ‘status quo’

Major Strategic Issues: 

Major Strategic Issues There are a range of reforms to the wheat trading system that are required This includes the way trade occurs Operation of pool financial products, transparency of charges and fees Contracts and transfer / retention of title Guaranteed access regimes to export pathway and regional storage and handling monopolies Transparency of commercial signals

Commercial Market Signals: 

Commercial Market Signals Greater transparency of the following commercial signals required urgently - NOW Production estimates Export sales data Tonnages reported New crop vs. old crop Export shipments Actual shipments (month by month) Stock levels Stock on hand (reported monthly)

Industry Good Activities: 

Industry Good Activities AWB currently spends $12 million PA on; Industry strategic planning and execution Wheat receival standards Wheat classification Crop shaping Wheat crop quality report Generic promotion of Australian wheat Research and development liaison Trade advocacy

Industry Good Activities: 

Industry Good Activities These activities are carried by the wheat export sector and paid for from AWB International marketing activities When strong commercial bodies are charged with responsibility for commercial activities and they control the INFORMATION, they control the strategic agenda. (Storey2003) Growers are the beneficiaries and source of funding for industry good activities…But they DON’T direct the activities And they don’t get full and free access to the information, data and knowledge they pay for.

Summary: 

Summary Government policy should reflect Long term view / benefit of the wheat industry Some form of regulation of wheat exports Support for pooling and payment security Need for greater transparency of commercial signals and information across industry Reduction of costs across value chain