The plan by Adelaide-based Viterra to introduce long term agreements (LTAs) to allocate port capacity at its six South Australian bulk wheat ports has been given the go-ahead by the Australian Competition and Consumer Commission (ACCC).
The LTAs will replace the current auction system as the primary method of allocating shipping capacity at the six ports. Adelaide, Ardrossan, Port Giles, Port Lincoln, Thevenard and Wallaroo. They will be introduced for the 2016- 17 shipping year, as the capacity for the current year has already been allocated through the auction system and the firstin- first-served process.
The LTAs will be available to export customers for an initial fixed term of three years, with a minimum commitment of 25,000 tonnes of capacity in each of the three years. Capacity will also be reserved for short term allocation each year.
The ACCC Commissioner Cristina Cifuentes said: “The ACCC considers that Viterra’s proposal, submitted in November, substantially addresses concerns raised in its draft assessment to not approve Viterra’s proposal made in June.”
The key amendments of the November proposal included a mechanism for the ACCC to review the initial longterm capacity allocation process and a reduction of the initial term of the LTAs from five to three years.