Michael McCormack Member for Riverina 24 February 2011

There is also considerable uncertainty in the Riverina due to a $600 million takeover bid for SunRice by the Spanish food giant Ebro. SunRice employs more than 600 highly skilled and qualified people in Australia and an additional 700 overseas. SunRice is a valuable Australian owned food business and one of the largest rice food companies globally. SunRice typically feeds up to 40 million people per day in more than 60 countries with high-quality Australian grown rice. Ebro is the world’s largest rice producer and has its sights set on SunRice in an attempt to increase its Asian presence. The Madrid based company has even improved its bid to buy SunRice by extending its commitment to buying rice at the benchmark Californian paddy price from five to seven years. Ebro has offered a good price at a time when rice growers are understandably wondering about their future.

Of course, a takeover of this magnitude brings the Foreign Investment Review Board into play. The Treasurer will also ultimately decide the fate of the deal. I am fearful that farmers who want to remain in the industry will be left in the lurch. Many other sectors—for example, dairy with the buyout of cooperatives—have found that the short-term financial gain to individual members is outweighed by long-term impacts such as reduced farm gate prices through the loss of market power. Companies can make guarantees for seven years, but what happens after that? We will not be able to control the price and we will not control any of the assets. While the decision comes down to individual investors or grower shareholders, farmers should recognise that once they lose majority control the focus of these operations will shift to the interests of the overseas shareholders. It is a deal which raises more questions than it gives answers in a region which, at the moment, needs confidence, not more uncertainty.