Supply chain improvements a key for growers, industry

BULK handlers and grain producers are united in their push to see greater efficiencies within the grain supply chain taking grain from the farmgate to port for export or to its domestic destination.

While there has been some tension between the grain trade and grain growers over issues such as Australia’s comparatively low grain prices, there is strong agreement between the sectors that bolstering the supply chain would be a win for all of the industry.

Grain Producers Australia said in their 2022 federal election survey a whopping 44.4 per cent of grain growers nominated transportation and freight costs as one of their top five policy issues.

GPA chief executive Colin Bettles said the Australian grains industry needed to prepare for larger harvests in the future as farmers got more efficient and yields increased.

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He said this year’s record crop, flagged by the Australian Bureau of Agricultural and Resource Economics and Sciences at 62 million tonnes, came in spite of production issues such as heavy frost, mouse plagues and excessive harvest rain.

“These events reduced the overall crop volume, quality and value in various grain producing regions, so this would suggest there’s still good opportunity to produce more Australian grain in future and improve returns to growers,” Mr Bettles said.

He said there had been issues within the grains supply chain which had impacted the execution of grain exports or deliveries to domestic customers.

“Currently, the major supply chain constraint, as we understand it, is about getting the harvested grain to ports in order to actually export the crop, not at the port terminals,” Mr Bettles said

This is backed up by the situation in Western Australia, where the major bulk handler CBH is moving to bring in grower transporters to deliver grain for the co-operative from upcountry receival sites to port to help meet the need for grain transport.

On the east coast, a GrainCorp spokesperson agreed that labour was a big issue across the entire workforce.

“The grain supply chain is not immune and all sorts of roles are vacant, from harvest casuals and maintenance staff to train drivers and ocean freight operators,” the spokesperson said.

Echoing the calls from grower groups, the spokesperson said GrainCorp would love to see government support to assist industry-led initiatives to improve apprentice and career pathways within the grain supply chain industry and to aid employee retention in the sector.

For its part, Mr Bettles said GPA wanted a strategic analysis of the national grains supply chain and associated infrastructure costs such as road quality, rail connectivity and port access, to inform national decision-making on future investments to help create better efficiencies.

GrainCorp said it saw rail as a key piece of the grain to port puzzle.

“Rail freight remains the most cost-effective way to get grain to port in an export year, but insufficient maintenance and neglect of regional freight lines in Victoria in particular is forcing longer cycle times and pushing more tonnes on to the roads, which creates further costs and increases safety risks,” the spokesperson said.

“There’s a major need for a staged plan with a vision for the future, which will help businesses like GrainCorp to make investment decisions that will optimise our network and improve up-country connections through to port.”

Mr Bettles agreed, saying getting GPA was committed to finding methods to eliminate costly duplications within the supply chain.

“The flow of grain from country storage to port must work to minimise cost and avoid inefficient use of resource and double handling.”

“We need this high-level analysis to identify investment opportunities – public and private – to ensure the Australian grains supply chain is fit for purpose.”

Mr Bettles said the industry also needed to figure out long term strategies to satisfy the domestic market.

“We need to meet projected growth targets for not only grain growing regions, but supply to key customers such as grain exporters, millers and livestock feeding agents.”

GrainCorp said further help for growers on managing variability and drought proofing could help minimise some of the volatility that is the Achilles Heel of the Australian grains industry right through the supply chain.

“We feel it’s important for Government to continue to support productivity gains for growers, through-the-cycle,” the spokesperson said.

The company is confident the current focus on ag-tech within the industry will pay dividends, saying ag-tech would provide critical long-term productivity gains within the grains industry.

The GrainCorp spokesperson also called for funding to encourage and reward growers with a focus on sustainability.

This could include areas such as improving soil health and general landscape, or providing tools to assist growers in estimating on-farm greenhouse gas emissions and carbon sequestration.

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The story Growers, industry push supply chain improvement first appeared on Farm Online.