CBH prepares for push east

Brad ThompsonThe West Australian
CBH chief executive Andy Crane.
Camera IconCBH chief executive Andy Crane. Credit: Supplied

CBH has opened up about Eastern States investment plans which include starting a grower co-operative in a move that could change the face of Australia's grain industry.

The WA co-operative said it was working on business plans for the leap into storage and handling on the east coast, including a version of its successful grower-controlled business model.

It will make a decision on whether to proceed by mid-year, with the initial focus on growers able to supply the recently opened Newcastle Agri-Terminal, which it part owns with Olam and Glencore.

The move is expected to have the full support of the Federal Government.

CBH heavyweights - including chief executive Andy Crane and chairman Neil Wandel - outlined the plans at grower meetings over the past week.

Dr Crane said CBH was weighing up investment in up-country storage and transport assets to feed grain into Newcastle port.

"We've been very clear with WA growers that this would in no way detract from their domestic network," he said. "We have been describing the type of structure we might use to do business and to encourage participation by growers on the east coast in a separate business that would not have any claim on the WA co-operative."

Speculation about CBH's plans for the east coast has focused on the NSW towns of Moree - where embattled GrainCorp operates a major grain receival centre - Narrabri and Burren Junction.

However, growers in southern Queensland and Victoria have also been keen to discuss cost savings under a CBH-run storage and handling system in a sign of the potential size and scope of the operations.

CBH invited some of northern NSW's biggest growers to WA to tour its facilities earlier this year and has had key staff in the Eastern States talking to producers.

"To build a business we have got to go over there and look at sites and talk with growers," Dr Crane said.

A co-operative model would carry tax exemptions in a competitive market dominated by publicly listed GrainCorp and multinationals.

CBH faces strong opposition to east coast investment within the ranks of its 4300 grower members and at board level, with some critics claiming it is planning to spend $100 million on storage and rail assets.

Dr Crane would not reveal specific details of the plans.

CBH also announced yesterday it was seeking the option of signing long-term access agreements with rival exporters seeking to use its ports in WA. It has made a submission to the Australian Competition and Consumer Commission to replace its existing Port Access Undertaking which expires on September 30.

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