Case Studies

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It is two years since the wheat industry was deregulated and timely to view where the industry is at, two seasons down the track. Whilst the papers were filled with the mixed viewpoints of those supporting and opposing the reforms, a review of the effect of these changes is well due.

As many primary producers across the state are taking off a harvest that will bring mixed results in terms of price and yield, there is one group of farmers that will be celebrating another good year of very high prices achieved through a marketing plan that has been written and strategised over 30 years. The proponent of this plan promised that a deregulated market would provide for much better prices for farmers and to date, this has occurred for followers of the theory.

Prices will still go low regardless of deregulation as the wheat market is a world market, but it is how this is managed by farmers that is the key. Surprisingly this marketing formula has been developed by a person who knows very little about the technical side of farming, but has scrutinised some of the practices of the industry and advises clients that much of the thinking of the industry should be questioned and challenged. David Burton is the Managing Director of Commodity Hedging Co.Pty.Ltd. 

David experience in commodities goes way back to 1983 when he started with an Asian futures broker based in Brisbane. In 1987 he started a job with the Cotton marketing board and work there until he started his business in 1990.The cotton industry was one of the first to be deregulated in Australia and David’s job was to hedge currency and futures as well as educate growers on risk management.