Download - John Murray, Emerald Grains - Identifying opportunities for Agribusiness within Australia
OPPORTUNITIES FOR AUSTRALIAN AGRIBUSINESS By John Murray
Managing Director Emerald Grain
OCTOBER 2014
FEEDING ASIA
@MDJohnMurray
• Setting the scene : Asian demand, vs Australian
production capability in grain.
• Challenges at home: Creating a more efficient grain
supply chain.
• Playing to our strengths: How can Australia
differentiate itself from international competitors?
• Conclusion: What will Australian agribusiness look
like in 20 years?
OPPORTUNITIES… AND
CHALLENGES
We are not the food bowl of Asia But there’s plenty of opportunity…
Asian demand - wheat
152%
83% 53%
23%
THAILAND
VIETNAM
INDONESIA
PHILIPPINES
Increase in ten year average imports 2004 – 2013 vs 1994- 2003
Source: USDA Import Data
Asian demand – wheat (1000mt)
China – the “wild card”
Source: USDA Import Data
Our market share into Asia – Wheat (Based on 2012/13 USDA figures)
Australian grain production 1960-now Can we keep up the pace?
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,0001
960
/196
1
196
2/1
963
196
4/1
965
196
6/1
967
196
8/1
969
197
0/1
971
197
2/1
973
197
4/1
975
1976
/197
7
197
8/1
979
198
0/1
981
198
2/1
983
198
4/1
985
198
6/1
987
198
8/1
989
199
0/1
991
199
2/1
993
199
4/1
995
199
6/1
997
199
8/1
999
200
0/2
001
2002
/200
3
200
4/2
005
200
6/2
007
200
8/2
009
201
0/2
011
201
2/2
013
201
4/2
015
Wheat Production (1000 MT)
Sorghum Production (1000 MT)
Oil, Rapeseed Production (1000 MT)
Barley Production (1000 MT)
GLOBAL “GRAIN BOWLS”
Supply chain efficiencies: from the farm gate to the end user
WHAT DOES IT COST TO GET GRAIN OUT OF THE COUNTRY?
RAIL IMPROVEMENTS WILL INCREASE OUR COMPETITIVENESS
• By 2015, Australian terminals will
have around 50 million tonnes of annual grain export capacity
• Six-year average annual exports is around 24 million tonnes.
• Yet around 80% of our grain exports occur from December – July.
THE PUSH FOR PORTS
Forfeit slot =
$2 million
loss
Compete for
grain = up to
$2 million
loss
DECISION
Forfeit slot, or pay over
market for grain?
HARVEST
Intense competition
for grain to fill slots
OCTOBER
Some production fails.
VaR = $2 million
MAY
Stem Auction
$40/tonne premium
Brand Australia: How do we stand out in a crowded Asian marketplace?
EMERALD GRAIN – AN OVERVIEW
WE ARE NOT UNIQUE Ukraine wheat exports – 1994 - 2014
0
2000
4000
6000
8000
10000
12000
14000
VALUE-ADDING: not an option
BUT WE ARE A TRUSTED SOURCE WHEN IT COMES TO FOOD….
NICHE AND HIGH-VALUE MARKETS
There’s ample opportunity
But we have a way to go…
Lower costs, increase efficiency
Define our brand
Target high-value opportunities
QUESTIONS