AWB Ltd WA regional manager Peter Hobbs this week responded to recent criticism of the agency's stand on grain quality, relating to warehousing.
Angry Geraldton growers last week criticised AWB Ltd for warehousing Australian Utility Hard (AUH3) wheat and paying only a General Purpose (GP) pool price, a $23.50 a tonne difference in returns.
But Mr Hobbs said farmers needed to remember that warehousing was a service offered to growers by Co-Operative Bulk Handling.
"It's not an AWB service and grain does not come AWB's way unless a grower assigns his warrants to AWB," Mr Hobbs said.
AWB Golden Rewards only applies to grain that is warehoused and is then transferred to AWB at a later stage into the National Pool, Multi V contract or Basis Pool.
As an example, if APW wheat with 5.3pc screenings is warehoused, grain will be binned as GP but the grower will be paid off the APW matrix when grain is transferred into the National Pool, Multi V or Basis Pool contracts.
CBH does not apply Dynamic Binning Strategy (DBS) to warehoused grain.
DBS is used by the AWB to segregate grain for its markets.
DBS works in the following way:
pA load of, say, APW wheat with 5.3pc screenings is placed in a stack averaging 2pc screenings
pUnder normal deliveries, this grain would be put into the APW stack but under warehousing, the grain would be binned as GP.
It's normally not a problem for growers because they will be paid off the APW matrix when they transfer the grain into the APW National Pool or deliver into the Multi V or Basis pools contracts.
Growers may have problems with warehousing if:
pThey sell to another buyer (for example a stockfeeder). If the grain is binned as GP, the stockfeeder would probably only offer a GP price
pThey deliver under an AWB Limited Multigrade contract where the pay grade equals the bin grade (if it is binned as GP, you will be paid as GP). This only applies to contracts written before the launch of the Multi V contracts (April) and all growers with these contracts are aware of this requirement.
pGrain is classified as AUH3. If this is the case, it must be binned as AUH3 as part of the AUH pool.
"If you warehouse AUH3, it will be binned as GP," Mr Hobbs said. "When it comes out of warehousing, growers will only be paid a GP price.
"It has been clearly stated that grain must be binned as AUH3 to be paid as AUH3.
"If a grower uses warehousing, he will be delaying his payment as the grain has not been delivered to AWB.
"Payment will not occur until the warrants have been transferred across to AWB."
Mr Hobbs said growers should ring CBH for warehousing terms and conditions before using the service.