A NEWLY-FORMED Arthur River oat pool has got off to a promising start in its first year of operation, with 14 growers supplying the pool's new receival site with 7500 tonnes of oats. A similar amount Is expected this year.
Most of last year's oats were sent by rail to the Blue Lake Milling Company at Bordertown in South Australia for processing.
Arthur River (AR) oat pool manager Bob Baker said that after one season he had already received inquiries from Japan. "I have got orders for exports coming in, but we have to walk before we can run," he said.
He said the oat pool was born out of a desire to do something more than just grow oats and hopefully take the volatility out of oat prices, which had ranged from $80/t-$200/t in the past two years.
Mr Baker said the buying price for oats in some countries had also not varied as much as they had on the farm. "We need a fair deal in this business," he said.
He said while the oat was regarded as a poor cousin to wheat, it was one of several crops, including barley and canola, that grew particularly well along the Albany Highway, from Williams to Kojonup.
"It is not only a matter of growing oats; it is a very good product," he said. "We think we can do better with oats."
Mr Baker said another advantage was consistency of supply from an area unaffected by drought.
He said there was also an increasing demand globally for natural products for which oats could play a role, particularly in items like breakfast cereals.
Mr Baker said that because oat flour was a natural commodity, it was replacing synthetic binders in food products such as muesli bars.
He said a new single serve instant cup of breakfast would soon be launched by Blue Lake Milling.
"I think there are great opportunities for oats, other than as a little bit of porridge or feeding oats to horses and cows," he said.
Mr Baker said the AR oat pool would also be able to fill smaller orders not catered to by the Grain Pool, which operated on a much larger scale.
Receival facilities at Arthur River include four 1250t grain silos, weighbridge and a 200 KVA power generator.
"The receival site is really the first stage of what could be up to five stages right through to a processing plant if that is required," he said.
Mr Baker said the idea of an oats pool had been put to growers in a public meeting, and due to the good response, the receival site was built.
"We have managed that pool during the year and I think those results are due to be posted in the next few weeks," he said.
"Our aim is to not let the oats linger too long, to receive the grain delivered at harvest and have it sold and paid for before the next harvest."
Mr Baker said rising demand for oats generally, and a shortage due to drought in the eastern states, made companies there look west for supply.
"We got our first opportunity at really getting into this business by saying: here are some of these oats from WA, try them and see what you think," he said.
Mr Baker said while the AR oat pool had transport costs to deal with, the smaller size of the operation led to better quality, which in turn generated premiums.
"It doesn't work unless growers get equal or better returns for his product," he said.
Mr Baker said in future, the AR management pool could deal with other grains as well.
He said there was potential to supply feed grain, but quality issues had to be addressed first.
"It would be something that we as a grains facility would be looking at trying to cater for," he said. "The feed grain business is starting to demand quality grain for the business of feeding animals.
"That option already exists but the question is how far do you want to go with this. It is a big capital expenditure if you want to do it right."
Mr Baker is manager of Red Hills, a property which owner Dick Lester has decided to sell. The receival site has been annexed from the property and would be run under the AR pool management, which Mr Baker runs for Mr Lester.