Jonathon White AWB speaks at BCG Womens' Agronomy Workshop

Jane’s Report on the Birchip Womens’ Agronomy Group Workshop
14th October 2010

Jonathon White of AWB Ltd explained grain marketing, models and products. It was interesting, as a Western Australian grain grower, to hear the Victorian perspective.

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  Food Security – grain stocks not as low as in 2008 but the forecast is that 60 days of wheat in the world will be the norm for 2010/11. In comparison - only 45 days worth in 2007/8 and 71 days in 2009/10
  
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  Prices have risen – sends a signal to growers to plant more wheat. “There is nothing like high prices to cure high prices" There could be big acreages in the ground next year– over supply
  
  
  The ‘Brand’ of Australian wheat in the world must be maintained. Educate Australian producers to ensure quality production practices. Accurate description of grain to ensure we sell what the customer wants
  
  The challenge with deregulation is to streamline the processes efficiently and accurately and to get the right product to port for the right consignment.
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  $US dollar is weak due to quantitative easing – government subsidising the $. $A dollar is strong from commodities demand in China and exposure to Asia. The market expects the Australian dollar to be volatile – massive ranges
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  28 accredited marketers – only 3 really active.Will see consolidation in the grain marketing industry – mergers
  
  Building and operating storage in not really an option for grain marketers, so there will be an increase in on-farm storage
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  Alternate paths built to avoid monopolies – potentially Geraldton and Albany. May result in increased fobbing (FOB) costs
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  Grain Producers Australia – only peak body that can lobby government on behalf of growers
  Rail infrastructure and port capacity
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  Prices will be discounted due to supply chain constraints Will see site based pricing – not port based pricing
  
  Pools – competes with grain marketers that are now in the market place Ask what is the strategy of your pool manager
  
  Manage your risk by marketing in all three options Cash, Pools, Store and sell later
  
  Key Message; “Keep talking to your banks and marketers and keep learning!”