South Korea-Shopping round for cheapest grain.

SOUTH KOREA-SOURCING GRAIN.

South Korea and Indonesia, two major Australia wheat customers are threatening to source high value wheat from other nations, potentially devastating the one bright spot in our economy.

The Shadow Minister for Agriculture, John Cobb, is calling on Prime Minister Kevin Rudd to personally intervene.

This follows the threat by the Korea Flours Mills Industrial Association, South Korea’s top wheat buyer, to stop buying Australian wheat.

"The association delivered a letter to the Australian Embassy which is reported to have stated ’if delays in loading wheat on ships in Western Australia aren’t fixed, then South Korean importers would have no choice but to source wheat from elsewhere, lest they run out of the cereal’," Mr Cobb said in a statement to the media.

"The Koreans are Australia’s third largest customer, we cannot afford to lose this market.

"It would be bad enough if it were just the Koreans threatening to pull out of the Australian market.

"However, Dow Jones Newswire is reporting that ’shipment delays have left most, if not all, Indonesian wheat importers scrambling to source the grain from other suppliers such as the US, Canada and Russia’."

The Dow Jones Newswire is also reporting: "In previous years, when AWB was the major or sole exporter, shipments were more evenly spread out, limiting the stress on the system at any one point.

"But with 22 different players jostling for space for the first time this year, the existing system has simply not been able to cope with demand amid the rush by everyone to get their cargo out at the same time."

Mr Cobb said the Rudd Government was repeatedly warned that by handing CBH Ltd an effective ’single desk’ monopoly on transport and ports, that bottlenecks would occur which could lead to the loss of markets.

"Minister Burke continually ignored this advice and now every Australian will be paying for his negligence," Mr Cobb said.

"Agriculture is the one area of the Australian economy which did not contract last quarter.

"The loss of these major export markets could be an absolute economic disaster, not just for farmers, but for the whole nation