Bunge builds for a bigger grain share

29 Jan, 2015 01:00 AM
Comments
8
 
Bunge's Bunbury port facility could be a lot busier this coming harvest if the company's plans to build two up-country storage facilities are approved.
Each facility is proposed to initially have about 100,000 tonnes of capacity...
Bunge's Bunbury port facility could be a lot busier this coming harvest if the company's plans to build two up-country storage facilities are approved.

BUNGE has made a significant move in its bid to win a bigger share of WA's grain market by applying to two Upper Great Southern shires to build grain storage facilities capable of holding up to 350,000 tonnes.

The multi-national company has lodged development applications with the West Arthur and Dumbleyung shires that outline its plans to boost its storage capacity to feed the Bunbury port facility it opened last year.

Bunge is hoping to have the facilities operating at more than half capacity in time for the 2015-16 harvest.

Its application was advertised for public comment on the Shire of West Arthur website on January 19.

Bunge's application stated plans to initially build a four-bunker 120,000-tonne storage facility, weighbridge and small transportable administration building on a site on the Coalfields Highway, 1.2 kilometres west of Albany Highway at Arthur River.

It also says space for an additional four bunker storage pads for future use will be allowed for.

This would take storage capacity to more than 200,000t on the site.

A similar facility, initially with a capacity of between 80,000 to 100,000 tonnes and expanding to 150,000 tonnes, is proposed for the other site some 95 kilometres further east, on the Dumbleyung-Lake Grace Road close to Kukerin.

Bunge has said previously it hopes to export up to a million tonnes of grain a year through Bunbury Port.

Its port facility currently has a storage capacity of 50,000 tonnes and Bunge has permits to export 500,000 tonnes in the first two years.

A traffic impact report, prepared for Bunge by Opus International Consultants (Australia) Pty Ltd for both the proposed Arthur River and Dumbleyung sites, states that Bunge's port storage capacity is sufficient to fill a 40,000-tonne ship with the port silos being replenished between ships.

The port "supply chain" will involve the proposed Arthur River storages operating at capacity to cover about 35 per cent of the exported grain, supplemented by existing CBH storage, private grain bins and on-farm bins, it stated.

When fully operational the two new storages will generate an extra 160 truck movements a day on the Coalfields Highway during the peak harvest period, with each ship requiring about 800 truckloads to fill it.

However, the Opus report points out that the "overall quantity" of truck movements involved in shifting grain from farm to port will not change, "with routes to Fremantle and Albany ports having a decrease in truck movements and an equivalent increase in truck movements using the route to the Bunbury Port".

Bunge expects the storages will service an area ranging from Pingelly in the north, to Lake Grace in the east and Tambellup in the south, according to a map in the report.

Bunge Australia general manager Chris Aucote confirmed the company's plans but said it was still in the early stages of the process.

"Each facility is proposed to initially have about 100,000 tonnes of capacity, with potential to expand in the future," Mr Aucote said.

"Growers have been asking us to look at storage and delivery options through to the Bunbury port.

"We have looked at a number of avenues, including the on-farm storage products and up-country delivery arrangements we put in place for last harvest.

"We think these new bunker storage facilities will further complement the current supply chain, and provide growers alternate delivery options."

Mr Aucote said Bunge had been in discussions with the shires and Main Roads for a number of months.

"We are only at an early stage in the development process, but we look forward to updating growers and the local communities as we move forward," he said.

"We are hoping to have the facilities ready for the 2015/16 harvest."

Shire of West Arthur chief executive Nicole Wasmann said the development would be great for the region but was concerned about the increased pressure of truck movements on Coalfields Road.

"Hopefully (the development) creates local employment and also provide benefits to our (local) farmers," Ms Wasmann said.

"Although we will need overtaking lanes for road safety."

Shire of Wagin president Phil Blight also has shown concern for his shire and the extra movements of trucks between Kukerin and Arthur River leading through the township of Wagin.

"An introduction of grain storages site is positive for our community, especially for our farmers," he said.

"But we are wary of road damages and the change of traffic flow - we will need more funding to maintain our roads."

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READER COMMENTS

x
29/01/2015 5:30:54 AM, on Farm Weekly

In the face of competition is CBH s common cooperative pricing model sustainable ?
boris
29/01/2015 6:57:15 AM, on Farm Weekly

Bunge has shown through its astute investment that growers will seek a cheaper path to Port given the opportunity. What is even more impressive is the way they have respectfully entered the Western Australian market-place. Many rivals questioned Bunge's investment but that seems little more that corporate envy. Bunge will capture 10% of WA crop for a mere investment of around 60 million a win win for all involved!!
beacon boy
29/01/2015 7:51:39 PM, on Farm Weekly

CBH will have to all but give up on this catchment once all this up country capacity is up. whos next cargill, ADM, Drefyfus or maybe even one of the Asian trading houses???? the leak is about to turn into a gaping hole and all our cbh wealth will evaporate as well . bloody travesty
drowning in debt
30/01/2015 8:41:00 AM, on Farm Weekly

these directors have never had to face competition & so no surprises they are like a deer in the spot light. they've got all this cash of ours at the moment so that makes em feel invincible but the future aint gonna be so easy when growers get choice. bloody dumb blindly loyal shareholders cant see they are about to have a haircut and in some parts of the wheatbelt storage handling costs are gunna explode. so they'll wear rising costs and a loss of the worth of their cbh share/s, maybe to nothing. wot you reckon will happen to land prices in those areas?? down down, prices go down
grainfracking
2/02/2015 8:06:39 AM, on The Land

The best businesses welcome competition as a prod to become more efficient. Do our board members have the strategic vision and foresight to lead CBH forward or do we always vote the way we vote and get what we have always got. #timeforchange #closedminds
Jock Munro
3/02/2015 12:59:02 PM, on The Land

CBH will provide the competition, not the middle men merchants. Lose CBH to corporate interests and growers will be gouged from farm gate to customer.
Argee
27/02/2015 7:11:28 AM, on Farm Weekly

Hard to see how this is competition when the State Government is putting in $100m+ to improve roads to allow wheat out of Bunbury. Perhaps the exporters should fund the road improvements and see what that does to the bottom line?
Geotech
20/03/2015 12:20:19 PM, on Farm Weekly

After being involved in road construction for the last 20 years I can say that West Arthur chief executive Nicole Wasmann SHOULD be concerned about the impact of extra heavy haulage on the wheatbelt roads -in terms of both maintenance (paid for by the tax payer) and safety - 6.5m wide sealed roads are NOT heavy haulage roads and considering the GSF bunker sites are within kilometres of the rail network.

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