AWB has increased its estimated pool returns (EPRs) for the company’s 2009/10 wheat pools, capturing gains from the rising world wheat market many months after the crop was harvested.

It’s the second time in two months that AWB has raised its EPR for last season’s wheat and this latest revision would compute to $23 million in increased grower equity.

Noodle wheat in AWB’s western pool is the standout performer, rising $18 a tonne to a new EPR for ANW1 of $268. Benchmark APW wheat grades are up by $6, with APW in the western pool now at $253 a tonne, and $251 a tonne (FOB, excl GST) in the eastern pool.

AWB General Manager Commodities, Mitch Morison, said AWB had worked and reworked its marketing and hedging programs steadily over the period since harvest to generate improved value for its grower clients.

“Growers who commit grain to AWB’s pools expect us to work for their best advantage; it’s what they contract us to do for them and with over 2.7 million tonnes in our 2009/10 wheat pools it’s very important,” Mr Morison said.

“Our early sales plan focused on selling the grades with the most relative value, which meant we held undervalued grades such as ANW and priced them later in the year when they represented stronger value.

“Similarly our sales program for ASW was relatively light in the early part of the year, especially from eastern Australia where we felt there should be greater potential for this grain. Then as crop problems emerged in the Black Sea region and there was less competition for lower grades, ASW from Australia became more valuable, so we’ve worked with that increased demand to push our ASW performance higher.

“Weather damage during the European harvest this year has caused buyers to seek out high protein in the later part of the 2009/10 campaign, which again we have been able to meet through our containerised export program for AH13 and AH14.

“These are not our final pool estimates for 2009/10 as we are not fully hedged; we are of the view the market is firm and we are positioned to capture further upside, although this also means there is still an element of price risk, so we will keep pursuing opportunities,” Mr Morison said.

Media Inquiries:  Ian Desborough 03 9209 2335 or 0418 853 881

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