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EXPORTING WHEAT FROM AUSTRALIA

ASOCIACIÓN DE COOPERATIVAS ARGENTINAS ______________________________ 14 NOVEMBER 2008

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WHEAT EXPORTS AUSTRALIA

• Wheat Export Marketing Act 2008 commenced on 1July 2008

• The ‘single desk’ export monopoly on bulk wheat has ceased

• Wheat Exports Australia (WEA) established as the export regulator to

operate the wheat export accreditation scheme

• Legislative objectives:• To promote the development of a bulk wheat export marketing

industry that is efficient, competitive and advances the needs of wheat growers

• To provide a regulatory framework in relation to participants in the bulk wheat export marketing industry.

• Developed to introduce competition into the wheat industry

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BULK SCHEME OVERVIEW

Purpose: To attest that an exporter is a fit and proper company

to export bulk wheat from Australia

The Bulk Scheme does not in anyway:– Regulate shipments of wheat in bags or containers (<50 tonnes) – Indemnify exporters – Provide any guarantee the exporter will remain financially viable

WEA does not in anyway regulate the quality, variety or grade specifications of wheat exported from Australia

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NEW EXPORT ARRANGEMENTS

• AWB International no longer holds any special status

• Australian wheat quality will be managed by the industry and not

government

• WEA does not indemnify accredited exporters or provide any

guarantee they will remain financially viable

• Nineteen exporters have now been accredited by WEA

• Exporter names and conditions of accreditation are published

online www.wea.gov.au

• Multiple exporters of Australian wheat means greater choice for

international customers

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AUSTRALIAN WHEAT INDUSTRY OVERVIEW

44%

5%

19%

19%

13%

Map Source: ABARE

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AUSTRALIA and ARGENTINA – 2007/08

Australia Argentina

Wheat produced:

Wheat exported:

Domestic use:

Area planted:

Average yield:

Regulation:

Export charges:

Total ag sector:

13 million tonnes

7.5 million tonnes

6.4 million tonnes

12.4 million hectares

1 tonne / hectare

Deregulated except bulk

wheat accreditation

No taxes (Wheat Export

Charge – $0.22/tonne)

2.8% GDP

16.3 million tonnes

10.2 million tonnes

5.3 million tonnes

5.7 million hectares

2.8 tonnes / hectare

Deregulated

28% export tax

9.4% GDP

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CASE STUDY - CBH

• Co-operative Bulk Handling in Western Australia• controlled by over 5,500 grower-shareholders• net assets of more than AUD1 billion• Annual turnover of more than AUD900 million

• Storage and handling:• 200 receival sites across the State• Total capacity over 19 million tonnes• 11 million tonnes received from harvest• Grain transported to 4 port terminals to meet volume and quality

requirements

• Investment:• 5 Indonesian and Malaysian flour mills• Vietnamese grain terminal and flour mill • Profits are re-invested in facilities and infrastructure

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CASE STUDY - CBH

• Marketing:• Operates various marketing pools on behalf of growers• Main license to export barley, lupins and canola from WA • Large exporter of wheat accredited by WEA

• Shipping:• Joint venture with shipping company

• Other activities:• Quality assured grain• Research and Development • Diversification

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FUTURE FOR AUSTRALIAN WHEAT EXPORTS

• Multiple accredited exporters competing to buy wheat from

Australian growers

• Greater innovation and choice for buyers and sellers

• Industry self- regulation

• Greater on-farm storage

• Ongoing investment in grain research • New wheat varieties• Improved water use efficiency and farming methods• Better milling quality of Australian wheat

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Further information

Contact details:

Caroline Rhodes

Senior Manager - Operations

Wheat Exports Australia

Email caroline.rhodes@wea.gov.au

Phone +61 2 6202 3400

Website www.wea.gov.au