March 13, 2008

AWB well positioned to compete under new export system

Australian agribusiness AWB Ltd. is well placed to compete under new wheat export arrangements to come into force on July 1, managing director Gordon Davis said Thursday.

The new arrangement, which will see multiple accredited exporters of bulk wheat, means AWB will shift from a volume focus to a margin focus with an emphasis on exports to selected markets and ongoing cost reduction, he said.

The company is looking at options to minimize the additional working capital requirements of the new exporting arrangements including ongoing pooling arrangements, he said.

AWB has a national grower franchise, strong global customer relationships and demonstrated trade execution capability that will enable it to operate effectively under the new system, he said.

The Labor government's pledge to accredit multiple wheat exporters will effectively end a protected system that since World War II has seen AWB Ltd. (AWB.AU) or its predecessor, the Australian Wheat Board, operate either an export monopoly or remain the dominant exporter.