Wheat deregulation setback

WA grain growers' hopes of full deregulation of the wheat export industry have been dashed.

Despite WA Liberals pushing the Federal Government for a five-year deadline to free up the market, Agriculture Minister Barnaby Joyce has come down in favour of Eastern States farmers.

Mr Joyce and Minister for Small Business Bruce Billson last week announced a new "flexible" code, which provided pathways for port terminal operators to be exempt from the more onerous code requirements.

The issue had pitted pro-free market WA growers and Liberals against Eastern States growers and coalition MPs who wanted greater regulation.

The final code will not contain a five-year sunset clause mandating full industry deregulation from 2019, despite a push from WA Liberals and initial support from Mr Billson, who oversees competition matters.

Instead, the code stipulates that a review of port access arrangements will be conducted in 2017, while grower-owned co-operatives - namely WA's dominant grains handler CBH - will be exempted from the code.

Mr Joyce said the code of conduct - monitored and enforced by the Australian Competition and Consumer Commission - will work with existing competition law to ensure third party access to critical port infrastructure.

"As a regulation under the Competition and Consumer Act 2010, a breach of the code is a breach of that Act, which has serious consequences," he said.

The Pastoralists and Graziers Association accused the Federal Government of bowing to Eastern States pressure, with Western Graingrowers chairman John Snooke saying Australia was now on a path toward re-regulation of the wheat industry.

"The Eastern States National Party is captured by a view of some farmers that gaining control of the supply chain will lead to prosperity, when in fact it has been the deregulation of the following competition and investment that will ensure that Australian wheat is viable in the future," he said.

Mr Snooke also accused the WA Liberal Party of being disingenuous in its opposition to the code.

"The WA Liberals said the code would lead to full deregulation when there was no sunset clause added to the code," he said.

But Mr Joyce said after consulting widely with industry, particularly from WA, he made some changes to the code.

"The code now ensures the level of regulation on port terminal operators is fit-for-purpose and won't impose unnecessary regulatory burden on our wheat export industry," he said.

"The code is flexible and all operators will still be required to publish certain information to ensure fair and transparent access."

The introduction of the code on October 1 will trigger the automatic repeal of the current wheat export legislation.

WAFarmers president Dale Park said the exemption was "good enough" and would save CBH $1.5 million a year in costs incurred through the administration of auctioning shipping slots.