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CBH Accepts Grain Freight but Farmers Face Increased Cost

Australian grain handler, CBH, claims it was pressured into accepting increased grain freight rates in a rail access agreement with Brookfield Rail, which has an exclusive lease over Western Australia’s rail system.

No new agreement had been reached at midnight on Thursday, April 30, when CBH’s prior agreement with Brookfield expired. This forced CBH to temporarily park its fleet at scattered points across the state.

CBH claimed that Brookfield was demanding an excessive access fee increase of 25% despite taking the Quairading and Trayning lines out of service, which Brookfield claimed to be reasonable. The two reached a final interim agreement that CBH claims it had little choice but to accept, that will expire on December 31 of this year.

"We were backed into a corner by multinational Brookfield Rail,” claims CBH chief executive, Andy Crane to ABC News. "CBH is extremely disappointed that the situation escalated to the point where trains were stopped," he said. “Given the peak shipping demand over the next few months, we had no option but to sign this agreement, to protect the international reputation of Western Australia's grains industry.”

Brookfield Rail chief executive, Paul Larsen is satisfied with the interim agreement and hopes the two companies can reach a long-term agreement by the June deadline.

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Lynda Kiernan is Editor with HighQuest Group Media and of the Oilseed & Grain News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@highquestgroup.com.

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