GrainCorp buy-out would put eastern Australia’s grain exports in foreign hands
22nd October, 2012
“CONFIRMATION that GrainCorp is the target of a foreign takeover bid threatens to create almost total foreign ownership and control of the eastern states’ grain export facilities,” Nationals leader Warren Truss warned today.“Surely this bid must jolt the so-far unwitting or unwilling Gillard government and the Foreign Investment Review Board (FIRB) to rigorously apply Australia’s national interest test to this latest proposed buy-out?”
The $2.7 billion cash offer from US corporation Archer Daniels Midland for GrainCorp will require FIRB approval.
GrainCorp operates seven of the nine bulk export terminals along the eastern seaboard at Mackay, Gladstone, Fisherman Islands (Brisbane), Carrington (Newcastle), Port Kembla, Geelong and Portland, and handles around 80% of Queensland, NSW and Victorian exports. Its storage and logistics assets encompass more than 280 storage sites (21 million tonnes) and 19 trains.
GrainCorp also has three container loading facilities at Fisherman Islands, Sunshine (Melbourne) and Geelong. These handle up to 400,000 tonnes of exports in 16,000 containers.
“SA grain export facilities are already owned by Canada’s Viterra, the Port of Melbourne facility is 50% owned by Japan’s Sumitomo through the Emerald Group and the second Brisbane Port facility by Singapore’s Wilmar.
“If GrainCorp is swallowed up by US giant Archer Daniels Midland, all bulk grain exporting capacity in SA, NSW and Queensland will be foreign owned and almost all of Victoria’s,” Mr Truss said.
“Australia’s grain industry is critically dependant on having reliable access to efficient export facilities. These facilities were built and paid for by Australian farmers but within weeks they may own none of them.
“The Gillard government cannot sit on its hands without thoroughly testing how the takeover of Australia’s largest listed agribusiness is in the national interest.
“We are rapidly descending into a state where farmers will toil in their paddocks while post-farm gate profits from Australia’s $9 billion a year grain crops will be counted in multi-national boardrooms.
“The very real potential for foreign owners to dominate Australia’s grain handling and export industry, and control the market as masters from afar, must be a factor in consideration of the national interest.
“So far the Gillard government and the Foreign Investment Review Board have been silent on their understanding of the vital role of Australian agribusiness and how it impacts on our nation’s best interests – both economically and in terms of food security.
“Part of the Coalition’s proposed FIRB reforms to take Board membership to seven members and include expertise in agriculture is so it can make informed decisions. As things stand, none among the four-member FIRB has any specific knowledge or appreciation of the complexities of Australia’s delicately placed farm industries.
“Beyond the FIRB being in a position to give sound, informed advice, the ultimate decision comes down to the Treasurer. Wayne Swan has, to date, shown precious little interest or comprehension of farm realities.
“In fact, not a single member of the Gillard Cabinet resides in regional Australia, let alone knows the issues that people, farmers, businesses and communities face in the regions. That includes the Agriculture Minister.”
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