Cargill to retain AWB name

Lara LadymanCountryman

US grain giant Cargill has confirmed that it will be sticking with the battle-hardened AWB brand for its Australian grain marketing operations.

The private grain trader picked up the spoils of the Oil-For-Food scandal for about $US677 million two months ago, from Canadian agribusiness Agrium.

Previously, AWB’s shareholders gave the nod for the sale of AWB, including the Landmark business, to Agrium last November, a deal struck for $1.24 billion.

Cargill Australia managing director Ralph Selwood said 60 days on from the purchase of the AWB commodity management business, a lot of work had been done on integrating the two organisations and establishing a game plan.

“We said we would retain the AWB brand and we are going to do that, ” he said. “The way we are going to do that is through the farmer side of our business — all the grain originating across Australia will operate under the brand AWB.”

Grain will be marketed under both AWB and Cargill brands.

“We are bringing together the rural organisations and companies. Both Robert Green and Jon White will be working across Australia with those teams, ” Mr Selwood said.

“The Cargill side of things was branded Australian Grain Accumulation (AGA) and that will come together under the one logo of AWB and the one voice of AWB.”

Nation-wide about 40 grain marketing representatives will come under that Cargill-flavoured AWB logo, including 10 in WA.

Mr Selwood said there would not be any job losses but there might be some realignment of positions.

The grain player, which now also owns GrainFlow’s 22 grain elevators, is keeping its options open as to whether it will build storages or run its own transport in WA.

“Clearly we have been working with CBH and there is a lot of talk about alternative systems in the west, ” Mr Selwood said.

“We are not making any commitments but certainly where we can get a service that can help us provide the right service in turn to our customers … we will work with those existing providers.

“If that is not the case, and there is an opportunity to do something more ourselves, we will also look at those opportunities, so we are keeping an open mind to that.”

Before Agrium took it over, AWB was one of the loudest opponents of Grain Express.

The Australian Competition and Consumer Commission’s decision to drop the centralised logistics system has opened the way for all comers to operate their own transport, but it is too early to say whether Cargill will take up that opportunity.

“But we are firmly of the view that competition drives efficiency and investment and hopefully in doing so will reduce cost to farmers, ” Cargill spokesman Peter McBride said.

For this harvest at least, while Grain Express remains in place, AWB will be offering cash prices at each silo.

AWB regional manager Jon White said that only time would tell what the industry would look like in 12 to 18 months and whether that would be the case for the following harvest.

And as to whether WA farmers will get on board with the new AWB, after the turmoil and shattered allegiances of recent years, Mr Selwood said the company would be putting its best foot forward, listening to growers, being as transparent as possible and working to earn growers’ support.

“The feedback from growers is that they are looking for pools and looking for some form of support in their ordinary marketing, so we are going to do what we can to provide that — make it as transparent as possible and make sure we do that in a healthy manner so they can trust that we are out there representing them and their interests, ” he said.

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