GrowerCo calls for perspective on politics behind case for Newcastle

Charles Brett, GrowerCo, March 22, 2019

On the eve of the NSW election, GrowerCo director and farmer Charles Brett says politicians should ensure the Port of Newcastle can compete on a level playing field when it comes to being an export point for grain grown in northwest NSW.

The Port of Newcastle is eyeing substantial growth in container movements, with the proposed facility at Mayfield a key site. Image: Port of Newcastle

GROWERCO is a co-operative which represents northwest New South Wales farmers who export significant quantities of product in containers.

We are situated approximately 500 kilometres from an international port that can handle the biggest ships in the world, and we have an underutilised, excellent rail network connected to it.

For us to be competitive in international markets, we need the most efficient supply chain.

We would like to send containers to the Port of Newcastle, which wants to build a world-class container terminal.

Instead, the NSW Government, through Sydney-centric policies, dictates our product is moved on trucks – lots of them – and sent interstate to Brisbane, or through Sydney to Port Botany.

This is expensive, and means far more trucks on our roads than need be, with resultant costs and a large loss of income for the state of NSW.

Potential savings

Why not use rail to Newcastle Port?

The cost of shipping grains and pulses such as chickpeas would fall by as much as $20 per tonne if they were exported via container from Newcastle rather than Brisbane.

Work carried out by Agripath on behalf of GrowerCo showed chickpeas represented 33 per cent of the northwest region’s production over the 10 years to 2017.

If costs were reduced by $20/t over 10 years, $500 million could be returned to regional northwest NSW alone.

A report by economists AlphaBeta found that in total, NSW exporters would save $1.3 billion in freight costs by accessing this less-congested and more efficient port closer to production areas, and
equipped with a world-class stevedoring capability.

There is no logical reason why an exporter from northwest NSW should have to send their containers interstate, or through Sydney by road, if there was an alternative in Newcastle.

Exporters in the Newcastle catchment area are prevented from doing so because The Port Commitment Deed is the NSW Government’s policy that ensures Port Botany (alone) is economically able to operate a container terminal.

The Port Commitment Deed means if a container goes through Newcastle, it would attract a $100 levy.

That money would then flow back to the private owners of Port Botany.

This arrangement provides Port Botany with a monopoly, an unfair advantage, and is anti-competitive, not to mention the fact that the cost of that decision is borne solely by only a portion of the state’s taxpayers.

The decision to monopolise Port Botany is a decision to penalise exporting businesses by way of extra cost, and all taxpayers by way of funding roads and infrastructure because of congestion

The government is clearly putting the interests of Sydney ahead of the rest of the state, the latest example being the taxpayer-funded $2-billion Sydney stadiums issue.

I have raised this with my local MP and, to my deep disappointment and dismay, I was informed the government’s policy will not change.

Private investors in the city benefit from this monopoly arrangement, while exporters and importers in the Newcastle catchment, and all through northern NSW, pay the price.

The NSW Government needs to govern for all the residents of NSW, not just the ones that live in the Sydney basin.

On 31 January 31, GrowerCo was invited to appear before a Public Works Committee inquiry into the impact of the Port of Newcastle sale arrangements.

That inquiry has so far decided to do nothing, despite compelling evidence from many sectors for it to do otherwise.

National Party leader Michael McCormack is seen in the media saying that he will deliver a fair go for regional Australians, while the Prime Minister is quoted in last week’s The Land as saying “without a strong agriculture sector, we can’t have a strong Australia”.

A container terminal at the Port of Newcastle requires no funding – private investment is ready to do that.

It will deliver money to regional Australia, exactly where it is most needed, especially at a time of the worst drought on record.

All this at NO cost to the government, except the political will to reverse a bad decision.

We are asking our leaders to remove the politics from this anti-competitive decision and deliver regional Australia what they tell us they “want” to do, but have clearly failed to deliver.

Charles Brett is a grower and a director of Grower Co-operative Limited. This opinion piece appeared in the 19 March edition of the Moree Champion.


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