| ||Storage and handling reform pays dividends for growers|| ||
AWB Limited’s drive for more competition in grain storage and handling is starting to deliver significant benefits for NSW growers, Chief Executive, Andrew Lindberg said today.
Mr Lindberg said there were clear and welcome signs that service providers in the supply chain were responding to AWB’s challenge to deliver more efficient and flexible services at lower cost.
“We are receiving a number of overtures from contractors in the supply chain who are willing to look at issues such as extended operating hours, infrastructure investment to speed up inloading and lower storage and handling charges in order to maintain market share,” said Mr Lindberg.
“GrainCorp was now considering 24-hour on-demand rail loading services at 18 key NSW sites and extended rail discharge hours at Victorian ports.
“It is clear that AWB’s drive to bring competition to the supply chain is paying dividends for growers and the reform was gathering pace.
“The catalyst to change had been the launch of AWB’s East Coast Strategy to stimulate competition in the supply chain,” said Mr Lindberg.
AWB’s key initiatives have been:
- the construction of seven new grain centers in Victoria and NSW offering improved services, greater efficiencies and savings of up to $4 per tonne on Site-to-Sea direct costs;
- a new contract with FreightCorp who have agreed to spend $100 million to improve grain and rail facilities by constructing high volume Grain Consolidation Facilities and purchasing six new sets of grain wagons (a seventh will be acquired by AWB and leased to FreightCorp);
- initiating negotiations with all supply chain service providers to identify and lock in greater efficiencies and cost savings;
- moves to create competition in port handling facilities;
- investment in the new Port Melbourne bulk handling terminal;
- introduction of two contract trains in Victoria and southern NSW.
Mr Lindberg said NSW freight costs have already fallen by an average of 10% over the past two years and these latest moves would accelerate the overhaul of the system.
“For too long grain growers have been asked to tolerate outdated infrastructure and relatively high prices to get their grain to market,” said Mr Lindberg.
“AWB is firmly committed to reducing supply chain costs for the Australian wheat grower. This is a key requirement and responsibility of AWB in operating the Single Desk.
“Competition at home to drive down costs and market power aboard to maximise prices is the best possible combination for Australian grain growers,” said Mr Lindberg.