02/12/2015 - 12:07

Growers deny deregulation push

02/12/2015 - 12:07

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Potato growers have poured cold water over reports earlier today that they’ll support deregulation of the industry, with the Potato Marketing Corporation saying it did not make any such recommendations and one senior grower representative labeling it a media stunt.

Growers deny deregulation push

Potato growers have poured cold water over reports earlier today that they’ll support deregulation of the industry, with the Potato Marketing Corporation saying it did not make any such recommendations and one senior grower representative labeling it a media stunt.

The West Australian reported that the Potato Marketing Corporation had asked the government to move forward with deregulation of the industry as soon as possible, rather than continuing the existing policy of doing so after the next state election.

In return, growers would receive compensation of around $24 million for lost income.

But grower representatives and the corporation itself said that was inaccurate.

The corporation said it had commissioned a report, following an announcement earlier this year that the state government would move to deregulation.

"That report, which recommended a $24 million structural adjustment package for growers and a timeline for deregulation which would have new industry arrangements in place by 2017, was given to the Agriculture Minister Ken Baston's office on November 18, 2015," the corporation said.

"The corporation has not made any recommendations to the minister regarding deregulation of the industry."

Farmer representative and Potato Growers Association president Dean Ryan told Business News the industry was still trying to work out the best way to move towards deregulation.

“We acknowledge that the government will deregulate it after the next election,” Mr Ryan said.

“At this stage it's business as usual.

“The PMC did commission the report … that’s as far as they’ve gone.”

He said growers were uneasy about the impact on their livelihoods.

“We accept that it’s inevitable … it’s going to be carnage,” Mr Ryan said.

“We’d rather get on and just grow spuds.”

In June last year, the state government’s Economic Regulation Authority backed deregulation, arguing the existing system would cost consumers more than $40 million in the next 15 years.

That sparked a round of overproduction in the industry, with some growers believing change would be imminent.

Galati Group managing director Tony Galati then cleared the excess stock cheaply through his Spudshed chain of retail stores, with a cut price giveaway of hundreds of tonnes, while other growers insisted the oversupply should be dumped.

Mr Galati argued that the regulatory environment, which had limited the number of potatoes grown in the state, pushed up prices for consumers and forced a cross-subsidisation between higher and lower quality growers.

Following a public backlash and internal party pressure, Premier Colin Barnett announced deregulation would take place after the 2017 election.

Mr Galati reportedly said today that he understood deregulation would proceed before Christmas.

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