AWB Ltd and ABB Grain Ltd accumulate grain from all grain growing regions across Australia, and trade in all grain commodities.

As such, NSW Farmers' Association Grains Committee chair, Richard Clark, says a merger will create one of the country's largest integrated grain companies, managing grain from the farm gate to domestic and export end users.

"The proposed merger has the potential to create a dominant position in the Australian industry which may deliver efficiencies to growers but will also need to be tempered to ensure effective competition continues," Mr Clark said.

"The Association will be seeking that the Australian Competition and Consumer Commission ensures there is no reduction in competition from a marketing, logistics and port services perspective.

"It is critical to the future of the grains industry in Australia that there is significant competition from a marketing and logistics perspective to ensure best prices in the hands of growers."