Farm lobbies lash Intergrain

ATTEMPTS by the state's only grain technology company Intergrain to establish itself as a viable commercial entity after 13 months of privatisation are being resisted by peak farming bodies.

Previously jointly funded by the Department of Agriculture and the Grains Research and Development Corporation, the company receives transitional funding but expects to operate on a fully commercial basis in the near future.

WAFarmers and the Pastoralists and Graziers Association are showing a rare united front in their criticism of recent attempts by Intergrain to strengthen its commercial position by imposing levies and seeking control of certain market segments.

Last week, WAFarmers announced it had successfully overturned an attempt by the company, majority owned by the state government, to impose a $2 a tonne end point royalty on a wheat variety that had previously not been levied.

After being cautioned by WAFarmers that they would launch a class action, Intergrain advised it would refund all EPR deductions and would not impose a levy on Carnamah wheat at any time in the future.

"In 2007 we had a tight financial year," commercial manager Tress Walmsley said.

"It was a significantly poor season with a drought on and we had pressure on our business as there was on all agribusiness.

"We are not getting continuous ongoing support and we did what most companies would do and that's try to raise funds by applying an EPR."

WAFarmers grains section president Derek Clauson said the levy was seen as a cash grab and that industry outrage had been compounded by the fact that Intergrain announced the levy after farmers had already sown the seed, effectively locking them into payment.

PGA western graingrowers chairman Leon Bradley said now the company had withdrawn the levy, the PGA would focus on its decision to compel noodle growers to sell their grain exclusively to CBH's grain pool.

Mr Bradley said, as with the levy, the PGA questioned the legality and propriety of Intergrain's actions.

"These two incidences are not doing anything in the way of creating a favourable impression," he said.

"Industry would have thought the plant breeding effort would have gone on in the normal way without having these additional imposts and restrictions placed on them."

Ms Walmsley said traditionally, WA was the only supplier to the $150 million a year Japanese market.

A number of factors, including deregulation, had caused the premium to fall and jeopardised WA's monopoly in the niche market.

"The best way that Intergrain felt it could get that premium back was to have control over those premium varieties through the CBH Grain Pool," she said.

Ms Walmsley said a condition of the deal with Grain Pool was that the majority of the premium had to go back to the growers