Wheat tops rural exports despite harvest pressure

02/10/2007 - 22:00

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Western Australian agribusiness exporters experienced mixed fortunes this season, with drought conditions putting pressure on the grains sector, while other sectors, such as meat, livestock and forestry experience a growth in revenues.

Wheat tops rural exports despite harvest pressure

Western Australian agribusiness exporters experienced mixed fortunes this season, with drought conditions putting pressure on the grains sector, while other sectors, such as meat, livestock and forestry experience a growth in revenues.

WA achieved a total grain harvest of more than 6.3 million tonnes for the 2006-07 season. Wheat deliveries made up around 70 per cent of the total grain deliveries, with barley comprising 20 per cent.

Wheat remains the dominant agricultural export out of WA, with AWB Ltd topping the list of agricultural exporters, despite a poor WA harvest of just less than 5mt.

In a turbulent year for the monopoly wheat exporter, following the fall-out of the Cole Inquiry, AWB exported about 4mt of WA wheat at a value of $1 billion.

Last season’s average free-on-board (FOB) price of $234 per tonne for the benchmark Australian Premium White wheat pales in comparison to the prices reached for the 2007-08 harvest, as low world stocks continue to push the national pool price to almost double that of last year.

This week, AWB increased its pool price for the benchmark Australian Premium White wheat by $65/t to $405/t FOB.

The increase will be welcome news for growers facing yet another below-average season as a result of ongoing drought conditions.

WA-based grain marketer and handler CBH Group also faced a challenging year, grappling with a below-average harvest and the uncertainty surrounding wheat export arrangements.

In the face of opposition by a number of its pro-single desk grower shareholders, CBH was successful in obtaining a licence to export 500,000t of wheat to is Asian flour mills, delivering growers $15 million.

CBH was recently granted another 500,000t wheat export licence for the 2007-08 season, significantly less than the 2.7mt requested.

Drought conditions don’t appear to have had quite the adverse effect on beef and livestock exporters, with significant growth achieved in this sector.

The state’s largest livestock exporter, Wellard Rural Exports, almost doubled its export revenue to $209 million.

The Fremantle-based live sheep and cattle exporter has increased its export numbers to South-East Asia from 5,000 animals three years ago to 170,000 head this financial year.

A Wellard spokesperson said the company’s increased access to shipping and vessels, due to its association with Siba Ships, had helped to boost export revenues.

Another live exporter, Emanuel Exports Pty Ltd, experienced a 20 per cent rise in export revenues this year, to $120 million.

According to Meat and Livestock Australia, Australian live cattle exports rose 18 per cent during the 2006-07 financial year to 676,797 head, the highest for three years, and valued at $497 million.

The state’s largest beef producer, Harvey Industries Group, producer of Harvey Beef, is performing strongly after taking over the operations of EG Green & Sons in March last year.

Harvey Industries is reportedly close to operating to full capacity of 800 head per day, and is projecting a more than 50 per cent increase in export revenues in the coming year.

The WA rock lobster industry also faced uncertain times this year, with a lower catch and rising costs forcing a wave of rationalisation among operators.

Geraldton Fishermen’s Cooperative will be hoping its recent acquisition of the major assets of Westar Lobster – putting it in control of about 65 per cent of the state’s $300 million rock lobster industry – pays off after its export revenues last financial year dropped 6 per cent to $95 million.

Formerly WA’s largest rock lobster processor, Westar Lobster (the merger of Lobster Australia and James Bowes Pty Ltd), increased its export revenue by 15 per cent to $100 million last financial year.

Australian wine exports reached $3 billion at the end of the 2006-07 financial year.

The most recent WA figures show an average export price of $5.72 per litre, with exports reaching $51 million in 2005-06.

Major exporter Palandri Wines, which exports 70 per cent of its product, generated export revenue of $5.4 million last financial year.

Fellow winery Ferngrove, which only exports 20 per cent of its product, achieved export revenue of $3.8 million, up slightly from the previous year.

Wood chip producers in the South West and Great Southern have reaped the benefits of growing demand for paper into Asia.

WA Plantation Resources achieved export revenues of just more than $85 million on the back of an increase in prices, while plantation blue gum wood chip producer Albany Plantation Export Company increased its export revenue to $48 million.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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