Director breaks silence to allay fears

23 Feb, 2006 01:03 PM
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THE chairman of the new AWB sub-committee charged with keeping the company's stakeholders informed during the period of the Cole Inquiry has assured growers that the organisation was not "in paralysis".

While most AWB directors have refrained from commenting to the media citing legal reasons, AWB board member and Morawa grower Chris Moffet emphasised that his position called for the need to talk frankly on issues where he was not bound by legal constraints.

Although sharing the feeling of deep disappointment felt by many growers and shareholders, he assured growers that for the vast majority of AWB staff, it was business as usual.

"Current pool deliveries are slightly up on original estimates so shipping is currently running slightly behind plan, but the AWB had been able to lock in some of the benefits of the current price spike and favourable dollar rate as a part of its regular risk management, while the ASX and growers have already been informed of the estimated pool return for 2006/07," Mr Moffet said.

Mr Moffet said that while growers were understandably concerned about the announcement that Iraq had excluded the AWB from the next tender for wheat, he said they should keep that statement in perspective.

This was partly because the tender has not yet been let, but also because similar statements had been made in various markets over the years and the current one may just be a part of normal commerce and not necessarily a statement of intent, he said.

"AWB has a legislative requirement to maximise pool returns, so it would follow that, if it is not able to put in a tender itself, it certainly wouldn't be trying to stop any of the applications currently before the Wheat Export Authority for the sale of Australian wheat to the Iraqi market," Mr Moffet said.

But Mr Moffet also reminded growers that if another company felt that it needed to put in a heavily discounted tender because of the current uncertainty, then the pool would be better off moving to a different market if a better price could be obtained.

Mr Moffet also said that AWB appeared to be be the only current source for the million or half million tonnes needed to meet any Iraqi tender, so if another company were successful, it would need to source the grain from the AWB.

Legislation governing pool returns would stop the AWB from selling that quantity of grain for less than other markets are paying.

Mr Moffet is currently scheduled to give evidence before the Cole inquiry next Monday (February 27).

He said the inquiry was charged with examining whether any company or individual breached the law regarding the Oil For Food (OFF) program ‹ events that go back to 1996/97 ‹ not the manner in which AWB Ltd is administering the single desk.

Mr Moffet defeated Katanning grower Trevor Flugge for an AWB director's spot in 2002, forcing Mr Flugge to step down as AWB chairman. Within weeks, Mr Flugge was appointed by AWB as a consultant to Iraq.

Mr Flugge has yet to give evidence at the inquiry.

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