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Wheat will never be the same again

July 1 changed everything for wheat growers. No more will AWB have a monopoly on bulk wheat exports, no more will growers have a receiver of last resort for their grain and no more will there likely be any guaranteed access dates for pools.

AWB managing director Gordon Davis this week makes the point that as a seasonal business growers don't have the luxury of taking 12 months to adapt.

They need to start making decisions about this new world in four months time or sooner.

The same goes for AWB.

It too is making key decisions about how it will market the coming crop and what role it will play in this new marketplace.

What's certain, at least in Gordon Davis's mind, is that it can't compete effectively with a constitutionally-embedded structure built for a business with monopoly rights.

In the next six weeks AWB will be hoping to convince shareholders that it is right – and that change is in both the company and growers' interest.

The Wheat Growers Action Group has already made clear it will fight any move to change the structure and believes AWB’s mandate to maximise grower returns is more important than ever.

Growers are now faced with a difficult dilemma.

What's more important – grower control or a strong AWB able to offer competitive prices and products at the silo and generate better dividends?

It is unlikely they can have both.

What do you think?

Posted By: SALLY WHITE on 10/07/2008 4:32:37 PM | Comments (3)

Comments

Date: Newest first | Oldest first

The moment AWBI is deconstructed the grower franchise in AWB comes to an end and AWB becomes accountable to its shareholders only (in the long term, the broader investment community) and another marketing adversary for farmers to negotiate.

AWB limited will then be motivated by profit for its shareholders at the expense of growers best interests.

Any "new world products" would simply be a marketing ploy to transfer as much grower and consumer money into shareholder pockets.

In this environment growers may well be better off investing their productive capital into grain trader shares and not actually produce anything. Particularly in our drought riddled environment and with corporate induced runaway input inflation.

What a crazy, mad, stupid thing to have done to one of the world's best grain export industries.

Posted by Incontinentia Buttocks on 11/07/2008 9:35:44 PM

AWB LTD must remain in control and ownership of growers and we must as individuals make every effort to ensure that our fellow wheat growers vote to retain control at the August 21st EGM. We have been sold out by the Labor Government and the Liberal Opposition - we must not sell ourselves out.

Posted by Jock on 14/07/2008 6:16:46 AM

It is nonsense to assume that grower control and a strong AWB are incompatible.

Posted by Ted O'Brien on 17/07/2008 6:49:37 AM

The grains industry is in the middle of one of the most important times in its history, with key issues such as the single desk and GM technology coming under the microscope. What is the opinion of the most important participants - the growers?