Australia: ABB Grain is facing stiff competition for AU$700 million domestic barley market from international marketers

Former monopoly barley exporter ABB Grain is facing stiff competition for the AU$700 million Australian market from a host of international marketers, The Advertiser reported November 13.

The competition has come as low world barley stocks have pushed prices to records this season with feed barley prices reaching AU$400 a tonne before slipping to about AU$300/t, still higher than ever before.

While farmers have mixed views on whether they are benefiting from deregulation, southern Eyre Peninsula growers are receiving prices equal to those offered at Port Adelaide for the first time.

But deregulation has led to precarious market positions with numerous farmers unable to fulfil contracts while others are watching prices go well beyond their contract prices.

Rural Directions marketing services manager Chris Heinjus said that a significant amount of barley marketing had been done by other companies this year.

"Grain prices in the past two weeks show that growers can gain up to AU$30 a tonne more on any day by shopping around," Mr Heinjus said yesterday.

Yesterday's cash prices show the highest cash price of AU$295 a tonne delivered to Port Adelaide was being offered by Elders and Glencore International (Brooks Grain).

It was followed by Centre State at AU$284/t, Cargill Australia Ltd AU$275/t and ABB AU$272/t, he said.

Mr Heinjus said that in yesterday's market, there was a benefit to growers from deregulation because Elders was offering a higher price than ABB.

ABB Grains general manager marketing Peter Jones said the company was still optimistic about its role in barley marketing.

Factors in its favour were that it owns the bulk of the grain storage and handling system in South Australia.

14 November, 2007