A “STATEMENT of issues” raising preliminary concerns about ANZ Terminals’ proposed acquisition of GrainCorp Liquid Terminals Australia has been issued by the Australian Competition and Consumer Commission.
ANZ Terminals and GrainCorp both provide port-side bulk liquid storage services in New South Wales, Victoria and South Australia.
They compete to store liquids including edible oils, tallow, non-flammable industrial chemicals and base oils.
ACCC chair Rod Sims said their “preliminary view” was the acquisition would remove a significant competitor in an already concentrated industry.
“We are also considering the impact on competition in the east coast states more broadly, including Queensland,” Mr Sims said.
“In some locations, the acquisition will lead to ANZ Terminals becoming the only storage provider for some liquid products,” he said.
“This loss of competition could result in higher prices for customers, or lower levels of service.”
The ACCC considers there is limited vacant land available for lease by new storage providers at ports, creating a key barrier to entry.
“Even where land may be available, it is highly uncertain that any new entrants would emerge in the bulk liquids sector to challenge ANZ Terminals,” Mr Sims said.
ANZ Terminals has provided a section 87B undertaking to divest the Osborne terminal in South Australia and the ACCC is considering whether the undertaking will address concerns.
“The proposed undertaking does not address the preliminary concerns we have in New South Wales and Victoria,” Mr Sims said.
The ACCC invites submissions from interested parties on the statement of issues by 8 August 2019. The ACCC’s final decision is scheduled for 17 October.