January 4, 2007

Wheat Australia and CBH get wheat export permits

Australian minister for agriculture, fisheries and forestry Peter McGauran has granted two bulk wheat export permits.

The permits granted to Wheat Australia and CBH pertain to exporting 300,000 and 500,000 tonnes of wheat to Iraq and Indonesia respectively, said McGauran.

Iraq is an important long-standing market for Australia where AWB enjoyed a monopoly prior to it being stripped off its veto power due to illegal deals signed with the Iraqi regime.

CBH, a grower-owned and operated co-operative, has offered western Australian growers a price premium and would supply Australian wheat to its mills in Indonesia. The majority of wheat available for export this year would be from western Australia.

Growers who deliver to the AWB National Pool would not be affected, as the current estimated pool returns (EPRs) would not be reduced as a result of this decision, clarified the minister.

Therefore, a condition of the export permits would be that both CBH and Wheat Australia contribute US$ 4 per tonne to the National Pool for each tonne of wheat they export, up to a total of 800,000 tonnes.

The Australian government would consult with growers in the next few months on future wheat marketing arrangements.

Incidentally, the South Australian Farmers Federation (SAFF) Grains Council has welcomed the decision, the first since the minister took over the power of veto over bulk export permits from single desk holder AWB International Ltd.