No oats segregation for Bunge

Bunge will not offer an oats segregation this harvest, despite rapidly increasing demand from international buyers.

Bunge Agribusiness Australia general manager Chris Aucote confirmed Bunge had explored the option of milling oats at its sites, but after consultation with growers, would most likely continue to focus on wheat, barley and canola.

The Grains Industry Association of WA Crop Report for July estimated 728,000 tonnes of oats would be produced this harvest, up 42 per cent on 2015’s harvest because of both increased plantings and favourable conditions.

Of this amount, 434,000 tonnes would be produced in the Kwinana port zone and 265,000 tonnes in the Albany zone, the report said.

Major markets for WA oats include China, India, the UAE, Malaysia, South Africa and Japan.

Despite the vast increase in plantings, the current oats price remains high.

Exporter Premium Grain Handlers is offering $250 a tonne, down from $260 a few weeks ago because of the forecast favourable season, but still significantly higher than the longer-term average of $180 per tonne.

Profarmer said in a newsletter last week that the fundamentals for oat production remained strong in the long term, with export markets in China, India and Malaysia growing at a rate of 12 per cent in the past year.

Domestic demand for oats has also surged. CBH recently announced it would build an oats- processing facility at Forrestfield, processing up to 60,000 tonnes of milling grade oats annually from the 2017 harvest.

Meanwhile, Quaker Oats will start operating its new plant in Forrestfield from this harvest.

UniGrain’s processing facility, including mills at Wagin and Bibra Lake, formerly owned by Morton Seed and Grain, has also expanded, processing up to 120,000 tonnes of milling oats annually.

The Bunge facilities include about a 120,000-tonne storage capacity at Kukerin and 200,000 tonnes at Arthur River.

Bunge WA regional manager Christopher Tyson said last year both could be expanded in the future if there was sufficient demand.

Grain is exported via Bunge’s $40 million grain terminal, which opened at the Bunbury Port in late 2014, expecting to handle about 500,000 tonnes of grain annually.

An industry spokesperson said it made sense Bunge would continue to focus on the larger-tonnage bulk shipped grains such as wheat, barley and canola through its bulk loading system.