“IT’S all over for the National Party,” Senator Julian McGauran said as he walked past me and out of the National Party room in 1998. The Senator had said a rumour was circulating that the dairy industry was going to be deregulated. He and the rest of the party room demanded that it be strongly denied and confidence and stability in the industry continue. After two hours of debate, it was quite obvious that the leadership was not going to deny the rumour. They were also not going to oppose deregulation – they were actually going to facilitate it.
When total deregulation came in on July 1, 2000, I had a day of deep, dark depression. I had seen the brutal results in wool, tobacco, eggs and sugar.
Farmers forever tenaciously confident in this industry’s future came to realise the reality that the government cancer of marketism – a disease carried on the wind of corporate interest – was, for them, ultimately a death sentence. And survival dictated that they cut the best deal they could. One of the most depressing aspects of marketism saw, one-by-one, all of our single-desk-seller marketing mechanisms put on the auction block – “a sort of slave market for our women and children”, as one speaker at a recent demonstration put it.
The proud dairy industry – the marketing success and envy of all; an industry owned by its farmers in five major dairy corporations – within a short eight years – were sold to foreign corporations. Bonlac went to Fonterra (New Zealand), Dairy Farmers and National Foods to Kirin Holdings (Japan) and Pauls to Parmalat (Italy). Only Australian-owned: Murray-Goulburn remains.
Two of our largest fruit and vegetable processors are American-owned. In meat processing, of the dominant four companies, three are foreign-owned. Now AWB Ltd wheat is in merger talks with the Canadian giant Agrium. The sugar industry was entirely and proudly Australian-owned. Within six years of deregulation, the industry was 80 per cent owned by Mackay Sugar, still farmer-owned and standing strong.
But dairying is the classic example of what happens when you give away control of the market. Two chains hold 85 per cent of the food market.
So within two years of dairy deregulation, the price to the consumers went up from 115c/litre (the three-year average pre-deregulation announcement) to 150c/litre in the December quarter of 2002. Price to the farmers, previously averaging 53c/litre, fell to 34c/litre. This gave supermarkets and others in control of the market chain a profit increase of $1040 million. Indeed, the winners were happy little Vegemites. But as we sadly all know, Vegemite is no longer Australian-owned.
* Bob Katter is an independent Queensland MP
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