A NEW grain handler with plans to enter the WA market next year, aims to save farmers up to $16 per tonne through a new supply chain model.
Available to those who deliver to the Albany port from the 2019-20 harvest, Farm to Ship will offer growers with grain stored on-farm direct access to port for shipping, cutting out the need for up-country storage.
Farm to Ship director David Ellett said the company identified on-farm storage to port as the lowest cost supply chain model, and set about making that option available to growers with a significant cost benefit.
“I think long-term the most efficient model for the farmer is to get grain out of his chaser bin into some storage on his farm, transport it to port and straight onto the ship – that’s what I’m about with this,” Mr Ellett said.
“It’s for farmers that have already invested in on-farm storage, and it’s a much more cost-effective way of getting their grain onto the ship and sold.
“The contract of sale for grain will be with existing WA grain buyers that farmers are accustomed to dealing with – Farm to Ship is purely a grain handler “
By developing a new supply chain model and scrapping handling fees, Mr Ellett said based on current business modelling, those who signed up for the service could save up to $16/t, or $25-$50 per hectare, depending on market conditions.
He expected the model to bring several other benefits to growers including improved time efficiency during harvest, the removal of transport and double-handling costs at local receival sites and the opportunity to access niche markets of high value through direct supply to the end user.
After discussing the proposal with farmers, brokers and buyers, the Farm to Ship director said he was aiming to secure about 100,000t of grain from growers within the Albany zone who utilised on-farm storage.
He said once a shipment was arranged the company would take responsibility for organising the transport of grain from farm to port.
“We need to generally in-load in about five days so I need to be in control of the transport to port,” Mr Ellett said.
“Farmers can use their own trucks and I’m envisaging that the farmer may cart more than 50 per cent of it, but if they can’t get all of their contract in five days I need to be able to use a contractor to move the rest of it.”
Once grain is trucked to the Albany port, Mr Ellett said the company would use its mobile ship loader to fill scheduled vessels.
“The key is that with a mobile ship loader you don’t take up a whole berth, so you haven’t got the cost of permanent infrastructure at the port,” he said.
“Also if you put in the permanent infrastructure at the port, it takes up the whole berth using this method we can use a multi-purpose berth because the ship loader is mobile.”
Mr Ellett said construction on 40,000t of storage at the Albany Port was planned to be carried out over the next 12 months with hopes for the first shipment of grain to be exported by late December 2019.
While Farm to Ship will only be available within the Albany zone from next year, Mr Ellett didn’t rule out expanding the company to other areas of the grainbelt if the concept was successful.
However, he said his initial focus was ensuring the pilot season of the operation was a success.
“I’m just focusing on getting Albany up and going smoothly and making sure that it works so the other ports at this stage would be a long term objective, not a short term one,” Mr Ellett said.
“I’m just taking it one step at a time.”
Farm to Ship information sessions for growers will be held over the next two weeks at Gnowangerup, Katanning, Lake Grace and Jerramungup.