AWB today announced it had successfully signed a one million tonne milling wheat contract with the China National Cereals, Oils and Foodstuffs Import and Export Corporation (COFCO), the sole buying agent for China.
The first shipment on this contract is due to load out of Western Australia during December 2003.
AWB Managing Director, Andrew Lindberg, said this was a significant contract to a very important market and hopefully paved the way to cement future demand for Australian wheat into China.
"AWB has been working closely with COFCO to build demand for Australian wheat," said Mr Lindberg.
"Our commitment to quality and our hard earned reputation for delivering on time and to specifications has assisted in securing this contract.
"The Single Desk provides a united front for Australian wheat growers and this has assisted in making this significant sale to China.
"As the Single Desk manager for Australian wheat AWB believes it is in the best position to meet Chinese quality and shipping requirements, providing flexibility and consistent supply to this important market.
"Australia has a proud history of supplying quality wheat to China to support their milling and baking industries, however, due to China’s domestic production Australian exports have been limited in recent years," said Mr Lindberg.
This is the first significant sale made by AWB to China since 1996. Prior to this Australia supplied between one and two million tonnes to China, however, since then Australia’s five-year average for wheat exports to China has been approximately 100,000 tonnes a year.
"China is both the largest producer and consumer of wheat in the world, producing in excess of 80 million tonnes of wheat annually. With the world’s largest population we see this as a very important growth market in the future," said Mr Lindberg.
"After the drought last year, we are starting to regain marketing momentum in a number of markets, based on the supply of consistent quality Australian wheat," said Mr Lindberg.
AWB has maintained an office in Hong Kong to service the Chinese market since 1994 and this sale was managed through the AWB Hong Kong /Asia office.