EXPANSION plans for CBH Fertiliser have been approved, with a new granular and liquid fertiliser Urea Ammonium Nitrate (UAN) storage facility to be constructed near Kwinana Grain Terminal.
CBH chairman Simon Stead said the expansion of the fertiliser business supported the co-operative's efforts to drive down fertiliser costs and increase the consistency of UAN supply for the benefit of Western Australian graingrowers.
"After achieving year-on-year growth of about 30 per cent since entering the market in 2015, CBH Fertiliser has reached maximum capacity at its currently leased facilities," Mr Stead said.
"With the approval of a custom-built storage facility near Kwinana Grain Terminal, CBH Fertiliser will begin a new phase of growth that will see the business enter the liquid fertiliser market and expand its granular fertiliser offering.
"The expansion of the business seeks to reduce growers' onfarm input costs, which has been a strategy of the co-operative for some years, and improve the consistency of UAN supply in Western Australia."
The development, which is budgeted at $55 million, will include the construction of an about 55,000 tonne granular storage warehouse and two liquid storage tanks, totalling 32,000 tonnes, with the liquid storage to be connected to the wharf with a new pipeline along the Kwinana Grain Terminal jetty.
The facility has been designed to provide for further expansion opportunities in future, enabling the business to expand with the continually increasing WA grower demand for CBH Fertiliser.
In addition to this, further granular storage will be located at a second leased warehouse.
"Following this analysis and considering rising construction costs in Western Australia, we have revised the scope of the storage facility while maintaining the expected benefits for growers," Mr Stead said.
"We will deliver a cost-effective storage facility that will drive down fertiliser costs and increase UAN supply for the benefit of our growers.
"Importantly, the capital expenditure will continue to be paid for by CBH Fertiliser cash flows over a period of years."
Construction is expected to begin in early 2022 and be completed in the first half of 2023.
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