Australia's ABB Grain to focus export wheat business on Asia

 

 

Australia's ABB Grain Ltd. (ABB.AU) will focus its export wheat trade initially on Asia but will look further afield if a large domestic crop is harvested late this year, Peter Jones, the company's general manager marketing, said Thursday (July 24, 2008).

 

Subject to accreditation as a bulk wheat exporter by regulator Wheat Exports Australia, ABB Grain will springboard off its existing export wheat trade in containers, where it sells into a dozen countries to dozens of customers, many of whom have indicated interest in buying bulk cargoes from ABB Grain, he said.

 

Existing customers in barley, pulses and oilseeds also have been wanting the company to be able to supply bulk wheat, as it will be able to do after accreditation, he said in a statement.

 

The Adelaide-based company's experience in barley exports, its links with international companies and involvement in wheat pools over the past decade make it well-positioned to handle bulk wheat exports, Jones said.

 

Indeed, the company might be able to create savings for all by exporting combined loads of wheat and barley on ships with separate storage, he said.

 

ABB Grain is one of what industry participants believe will be more than 10 companies seeking accreditation as bulk wheat exporters, after new arrangements were introduced July 1, ending AWB Ltd.'s (AWB.AU) dominance of the trade.

 

Jones said the company does not intend to buy the entire wheat crop in South Australia, nor would it do so even if it had the financial capability.

 

"ABB won't be a global rival for the established international grains giants," he said.

 

Rather the company will position itself as a niche global trader. It already has sold durum wheat in containers to Italy for making pasta and is keen to develop other niches, he said.

 

The company operates a string of coastal export terminals and upcountry storage facilities in South Australia state and neighboring areas of Victoria state. It is investing more than AUS$100 million (US$96.15 million ) in a deep-sea grain terminal at Adelaide city's outer harbour, which will give growers and grain marketers in the state an export advantage, he said.