Western Australia’s peak farmers’ representative groups are at odds over the possible privatisation of grains handler CBH Group, with one faction claiming it is the solution to the industry’s current woes, while the other says it would hurt growers both in the short and long-term.
The Pastoralists and Graziers Association put forward the idea of a public float for CBH earlier this week, saying it was the key to injecting capital into WA’s grain industry.
But the Western Australian Farmers Federation today warned the state government that the privatisation of CBH would hurt WA growers, both in the short and long-term.
WAFarmers said farmers were currently facing hardships, especially in the eastern Wheatbelt, but selling off CBH would be “the worst kind of reaction”.
WAFarmers grain section president Kim Simpson said CBH actively worked with farmers to provide the best service possible at the least cost to growers.
“The grain industry has evolved over time and so has the cooperative,” Mr Simpson said.
“It is a modern business meeting the needs of growers.”
Mr Simpson estimated the privatisation of CBH would see $30 added to growers’ freight costs for every tonne of grain.
“There would, of course, be a short term gain, however those people left in the industry, in a lot of cases our sons and daughters, would be paying that back many times over for the rest of their farming lives,” he said.
Growers currently receive between $20 and $40 per tonne in savings for each tonne handled by CBH.
“When you compare that to what our fellow grain growers in other states are forced to pay, there is a clear benefit to the cooperative structure,” Mr Simpson said.
“The alternative corporatized company would be providing, at best, an adequate service for the greatest possible return to shareholders, therefore a cost to growers.”
CBH Group chairman Neil Wandel told ABC Radio today that the cooperative will not consider an extraordinary general meeting to debate the future of the group.
