Grain growers go through the onboarding process to ship grain for WA’s CBH Group | farm weekly

IN February, CBH Group called on growers to get out there to help move grain from land to port and although no grower has started directly carting for the co-op, there was interest from 34 farmers.

CBH’s grower truck program has been split into different sections and so far through the grain forward haul initiative, growers are providing 30 extra loads per day on their way to pickup sand-lime or fertilizer.

However, those producers who have offered to drive directly for CBH or subcontract to existing road construction companies as part of the producer transport initiative are going through the onboarding process.

Chief Executive Officer Ben Macnamara said this is to comply with current regulations and safety in preparation for transport on certain routes in the Esperance and Kwinana zones in the coming weeks.

“Our road contractors have not only supported us in launching the add-on truck initiatives, but have also worked with us to increase capacity by bringing on new subcontractors across the network and changing truck configurations to accommodate trailers leased from CBH record,” said Mr Macnamara.

“In addition, the two additional Aurizon rail fleets are scheduled to become operational in April, adding to the existing 10 owned by CBH and one fleet already provided by Aurizon.

“One of these fleets will be deployed in the Esperance zone within the next month, the first time rail has been operational in that zone in several years.”

As of March 31, CBH had exported 7.89 million tons of grain, according to its export plan.

For the October 2021 to March 2022 period, this included 1.95mt from the Geraldton Zone, 2.8mt from the Kwinana Zone, 1.58mt from the Albany Zone and 1.59mt from the Esperance Zone.

“Since October 1st last year, CBH has added 740,000 mt of additional capacity, bringing the total capacity to 17.74 mt,” said Mr. Macnamara.

“The most CBH ever shipped in a year was 15 tons, so this offered shipping capacity is already at a record high and we are looking to increase this to meet market demand.”

This demand is largely due to the ongoing conflict between Russia and Ukraine, which has halted grain and oilseed exports from those countries.

With estimates of between 60 percent and 90 percent of Middle East and Africa’s wheat imports coming from either Ukraine or Russia, the disruption prompted a surge in commodity futures markets in North America and Europe.

Mr Macnamara said the full rise in futures markets was not reflected in cash markets around the world, including Australia and North America, as consumers and traders effectively stood aside as short sellers were squeezed in futures markets.

“However, as this begins to unravel, futures markets will likely reflect fundamentals more accurately,” he said.

“North Africa and Middle East buyers affected by the Ukraine conflict have sourced their immediate needs from Europe and India as Australia’s shipping capacity is fully sold.

“Asian buyers have remained on the sidelines during this period, with the majority covered until mid-year and preferring to wait.”

With continued restricted exports from the Black Sea, additional demand is likely to shift to Australia and other origins in the coming months, which CBH hopes to capitalize on by adding further hauling capacity through its add-on truck initiatives.

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