03/04/2018 - 16:02

Lower prices hit revenue

03/04/2018 - 16:02

Bookmark

Upgrade your subscription to use this feature.

SPECIAL REPORT: Western Australia’s five biggest agribusinesses are earning about $5.5 billion in revenue annually, according to the latest BNiQ Search Engine data, down from $5.8 billion when the list was last published 18 months ago.

Lower prices hit revenue
Revenue is lower at many of the state's biggest agribusinesses.

Western Australia’s five biggest agribusinesses are earning about $5.5 billion in revenue annually, according to the latest BNiQ Search Engine data, down from $5.8 billion when the list was last published 18 months ago.

To put that number in context, the value of agricultural production in WA is about $8.2 billion per year, according to the Department of Primary Industries and Regional Development.

With most WA agribusinesses unlisted, Business News has used a variety of sources to collate the data, including information filed with the Australian Securities and Investments Commission and Australian Taxation Office.

One business that has rapidly ascended the list in recent years is US-base Bunge.

BNiQ Search Engine research shows Bunge, which operates the Bunbury grain export terminal, is the state’s third biggest agribusiness by revenue, with an income of $529 million in the 2016 financial year.

The company’s port operation was commissioned in 2014, with new receival facilities built at locations including Arthur River since.

A number of other businesses in the top five had a dip in revenue.

Grain handler CBH maintained its position at the top of the list, although revenue fell 6.5 per cent to be $3.5 billion.

That was driven by lower grain prices, although a record throughput of 16.6 million tonnes partly offset that fall.

CBH appears unlikely to be challenged at the top of the list, with a $750 million investment strategy under way to improve supply chain efficiency likely to boost tonnages.

The second biggest agribusiness was also a grain handler and trader, Mitsui & Co-backed Plum Grove.

Plum’s revenue dipped about 12 per cent to $527 million.

That figure includes sales from NSW.

“The season in WA is looking strong and is anticipated to produce good profitability sufficient to offset any negative impact from reduced volumes at the NSW operations,” Plum said in its annual report.

Revenue at livestock trader Wellard dropped around 13 per cent to be $498 million as that business continued to wrestle with a  tough live export market.

“Our key South-East Asian market remained under margin pressure as a result of record high cattle prices and a firm Australian dollar, which resulted in pricing that met buyer resistance,” chairman David Griffiths said in the business’s most recent annual report.

Other businesses in the cattle trade also experienced falls in revenue.

Consolidated Pastoral Company’s revenue fell 6 per cent to $154 million, Heytesbury’s revenue was 19 per cent lower at $51 million, while revenue at International Livestock Exports was down 26 per cent to $185 million.

The story was no better among seafood players.

For Austral Fisheries, revenue dipped about 13 per cent to be $120 million.

At KB Foods, the fall was about 21 per cent, to $404 million, while revenue at Geraldton Fishermen’s Cooperative was about 18 per cent lower.

One notable inclusion on this year’s list is timber player Quintis, with revenue of about $97 million to June 2017.

But the company’s future is under a cloud after entering receivership in January.

That came after a year of dramatic problems for Quintis, which included governance issues and a short-selling operation by a global fund manager.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options