Better inventory information essential to grower marketing | weekly farm

PRODUCER groups are asking for more analysis on the benefits to the production sector of more information on stocks, including data on crop quality.

Grain Producers Australia has been lobbying the government for a broader Australian Competition and Consumer Commission review of the current Port Access Code to include all grains.

A key part of their demand was calls for more transparent stock reporting.

“Producers are price takers and therefore vulnerable players in the supply chain,” said Grain Producers Australia chairman Barry Large.

RELATED: GPA Q&A on grain prices

RELATED: Low prices under the microscope

“There is an ideal opportunity to engage resources available to government, such as the ACCC, that way we can anticipate these issues, protect producers and maximize competition in the Australian grain market.”

Grain Growers president Brett Hosking said he believed having more information would benefit the entire industry.

“It’s not just the growers, it’s also others outside the bulk handlers in the trade,” Mr Hosking said.

“Some people will definitely use the information, some won’t, but if it’s there people have the ability to use it if they want to.”

“An open and transparent flow of information can better help people adapt their marketing program, as opposed to the current situation where people make ‘estimates’ of what they think is happening in terms of supply and demand.”

Mr Large also said he considers stock information important.

“The appropriate level of inventory information necessary for the effective functioning of the market, and the independence and timing of the communication of this information to the market, is an example of a persistent problem that remains unresolved.

Mr Hosking agreed with Mr Large that the time had come to explore potential positive reform for the industry.

“We haven’t looked at reform carefully since the deregulation of the wheat industry.

“The only way to clearly see what worked and what didn’t is to experience it, now we know which aspects are going well and what we potentially need to look into.”

Mr Large said identifying gaps in the supply chain would create a more robust industry in the long run.

“We need this high-level analysis to identify investment opportunities – public and private – to ensure that Australia’s grain supply chain is fit for purpose and designed to meet expected growth targets not only for grain-producing regions, but also for the supply of key customers such as grain exporters, millers and livestock feeders,” he said.

Mr Large said one of the first changes he would make in terms of stock information was to ensure it was timely and independent.

“The level of market power held by major bulk grain handlers who also sell and market grain – and the influence of that market power on other participants such as second and third tier bulk handlers, is another issue that also causes constant concern,” Mr. Grand said.

He said that with more timely and accurate stock reports, farmers would be more confident to use value-added marketing products such as derivatives, which have been underutilized by a production sector concerned about sudden market turns that expose them.

“We believe that these types of grain marketing products and services can be improved through better quality, independent market information and transparency, especially timing and reporting of stock information.”

For their part, major bulk handlers said they believed an inventory information system would only work if everyone who held grain, including producers with on-farm storage, was required to participate, claiming that it would be a flawed system if the system was just centered on the major grain receptors.

Start the day with all the great agriculture news! Sign up below to receive our daily Farmonline newsletter.

The Story Better stock information essential to grower marketing has first appeared on Farm Online.

About Marilyn Perkins

Check Also

Digital Marketing Agency Envisionit Hires Tiffany Curry as Director of Partnerships and Andra Bradley as Executive Director of Media

CHICAGO–(BUSINESS WIRE)–Envisionit, a digital marketing agency serving fintech, destination and CPG brands with media, creative …