New mill for WA oats

Jo FulwoodThe West Australian

A new multimillion-dollar oat milling facility in Forrestfield will double the processing capacity of WA-based Quaker Oats.

The new mill, estimated to be a $20 million-$30 million investment, will inject greater confidence into the oat industry and stabilise prices, according to Quaker Oats supply chain manager Chris Maughan.

While construction of the facility is almost complete, the mill won't be operational until September, in time for next year's harvest.

The mill will be attached to the company's new cleaning facility, completed in 2010.

Quaker Oats merged with US public company Pepsico in 2001, but Mr Maughan said the company had been milling oats on the Forrestfield site for almost 25 years.

He said growers would now be making decisions on seed carry over for next year's crops, and the new mill would provide greater market depth for WA oats to be delivered into Asia.

"Part of the problem with oats is that the Asian market has had a set tonnage requirement and there have been times that the market has been over-supplied when we have had a boom production year, and the price would drop significantly because of oversupply," he said.

"Farmers always remember that last price and the risk of not being able to sell their oats.

"But the investment in the new mill, combined with the good demand for export raw grain in Asia, shows there is a lot more market depth than there used to be.

"We could have sold more oat products over the past few years if we had had the capacity." Mr Maughan said

Asian consumers favoured WA oats as a trusted food source.

"The interesting thing about the Asian oat market is that it is focused on WA as the supply source, and consumer confidence in locally produced food sources is very low," Mr Maughan said.

"Chinese consumers are cautious with locally produced products so they've been branding the oats to show the product has been made with Australian oats."

Grains Industry Association Of WA oats council chairman Will Carrington-Jones said the investment in the mill was great news for WA oat growers.

"Together with the new recently commissioned Quaker Oats mill in China, Quaker Oats will now require a significant increase in its requirements of WA oats and this will benefit the State's milling oat growers," he said.

"This investment will put greater stability into the WA oat market, and give growers the confidence to plant oats in the coming year.

"It's a significant step forward for the WA oat industry."

The mill will incorporate new equipment housed within a 32m tall building over six floors.

Though the equipment is new, Mr Maughan said it would still use the same manufacturing processes that had served the business well for the past 20 years.

"The design of the new oat mill will allow continuous operation," he said.

"Demand from Asian markets continues to expand and this will lead to an increased requirement for milling oats.

"With new higher yielding milling varieties such as Bannister and Williams, farmers will have the potential to boost their income from milling oats. "

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