An increasing trend towards markets developing their own chemical regulations, including maximum residue limits (MRLs), could have significant implications for the Australian grains industry.
In a GRDC Grains Research Update presentation, Gerard McMullen - the chair of the National Working Party on Grain Protection (NWPGP) - said markets might decide not to rely on international standards, such as Codex Alimentarius, and develop their own.
He said other trends towards requiring lower (or nil) residues on grain supplied and increased monitoring of consignments also had trade implications.
Regulations by country
Mr McMullen said each market, whether it be in Australia or overseas, had its own chemical legislation (see some examples in Table 1).
This is based on chemical usage and food consumption patterns and means different MRLs for the same chemical and commodity can apply in different markets.
Therefore, applying a chemical according to label directions in Australia does notnecessarily mean that grain will meet market requirements.
Mr McMullen said there is concern that advisers or growers may not know market requirements before chemical use.
"It is not expected that growers will significantly change their chemical use practices because of those different market requirements, but greater awareness of the risks of chemical use on maintaining market access is needed," he said.
Actions on the ground
Australian growers had always shown themselves to be responsible users of chemicals, Mr McMullen said.
Using the Grain Trade Australia Wheat Trading Standards as an example, he outlined its wording in relation to chemical use - "Chemicals not approved for wheat, where a nil tolerance applies, refers to the following:
- chemicals used on the growing crop in a state or territory where the wheat was grown in contravention of the label;
- chemicals used on stored wheat in contravention of the label;
- chemicals not registered for use on wheat;
- wheat containing any artificial colouring, pickling compound or marker dye commonly used during crop spraying operations that has stained the wheat;
- wheat treated with or contaminated by carbaryl, organochloride chemicals or diatomaceous earth; or
- chemical residues in excess of Australian Commonwealth, state or territory legal limits."
Mr McMullen said the above example showed that there are many restraints on chemicals being used. Additionally, different market MRLs for chemicals and commodities adds another level of complication that growers must consider for particular crops.
It is not expected that growers will significantly change their chemical use practices because of those different market requirements, but greater awareness of the risks of chemical use on maintaining market access is needed.
Mr McMullen said residue testing is done either by the marketer or by the National Residue Survey (NRS) on domestic grain and export grain shipments. The NRS is funded via a grower levy.
If residues arise that exceed the market MRL, the shipment might be rejected and returned to Australia. In this case, costs can be passed from the marketer to the grain supplier where there is evidence of chemical misuse or false chemical use declarations.
Mr McMullen said increased sampling and testing of future loads from that grower could occur.
He said monitoring of all Australian shipments could also increase. Or additional segregations might need to be created. All of these things create extra costs, which could be passed on to the grower through the purchase price offered for the grain.
Because the post-farmgate sector expects that growers follow legal requirements (such as label directions) when applying chemicals - and due to the expense of testing grain for all possible chemicals used - only targeted sampling and testing of consignments is conducted. This is based on market risk.
It means that when asked, growers must provide accurate information on chemicals used.
Growers are encouraged to complete Commodity Vendor Declarations correctly when details of chemicals used are sought by the trade. Failure to do so risks:
- the supply of grain that fails to meet market requirements;
- a loss in reputation of Australian grain; and
- increased costs for all along the supply chain.
Tools for marketing
Although the system might seem complicated, Mr McMullen said there were tools to assist with meeting market requirements.
"The NWPGP is the linkbetween government and the industry," he said.
"It provides feedback, advice and strategies for dealing with changing market requirements and actions by all in industry to address these.
"We hold an annual conference to discuss the industry's performance and any changes needed."
Mr McMullen said the past two years had seen the NWPGP focus on providing more information to growers and advisers on changing market requirements.
"The gap between knowledge of the market requirements and what happens on-farm was recognised and communication to the pre-farmgate sector has increased through development of fact sheets and presentations to a range of stakeholders throughout Australia," he said.
With market regulations continually changing, he said it was vital for all stakeholders along the supply chain to be aware of requirements in relation to MRLs.
"Given the implications of incorrect chemical use, there is a need for greater transparency and understanding by growers and advisers of the impact of chemical use on market access," he said.
"Going forward, there will be a focus on ensuring all supply chain participants understand the risks of non-compliance with label directions and removing the gaps in networking; including chemical registrants, re-sellers, agronomists, growers and their advisers."
More information: Gerard McMullen, 0419 156 065, email@example.com,
Useful resources: National Working Party on Grain Protection, www.graintrade.org.au/nwpgp; National Residue Survey, https://www.agriculture.gov.au/ag-farm-food/food/nrs; Australian Pesticides and Veterinary Medicines Authority, https://apvma.gov.au