OVER the next 10 years CBH Group has set its sights on generating the ability to receive an average 22 million tonne crop and out-turn 70 per cent of the first-half shipping window.
The lofty ambitions were announced by CBH in a letter to shareholders on Monday and form a key part of the co-operative's refreshed 10-year strategy and updated targets in order to ensure its supply chain and network matches pace with the increasing crop size.
Three strategic objectives were set by the board, with CBH Marketing and Trading having the ability to market approximately 50 per cent of the Western Australian crop to international customers and CBH Fertiliser holding a 15pc market share in the WA grain fertiliser market rounding out the list.
The new strategy ensures CBH is planning and investing in the network, particularly as growers continue to improve and innovate their farming practices.
With that in mind, the co-operative has planned around an average crop size of 22mt in 2033 and a peak at approximately 28mt.
Chief executive officer Ben Macnamara said in order to achieve that task, CBH would focus on improving its outloading ability and had set the goal of 3mt monthly peak export capacity by 2033.
"Our current outloading capacity is 1.6mt, so we need to almost double the existing capacity and take into consideration the capital cost," Mr Macnamara said.
"In a normal year, grain is CBH plans for 22mt average harvest worth more in the front half than it is the back half of the year, so on that basis we find the market is skewed to trying to execute in the first-half shipping window.
"That is when growers get the greatest return for their product, hence the reason we're seeking to provide that 3mt per month capacity in the front half of the year."
In order to bring the updated strategy to life, CBH has identified three priority areas - investing in people, technology and innovation, both information and operational, and tonnes to customers.
When it comes to getting tonnes to the customer, a key focus area will be the improvement of infrastructure and assets, with purchasing new rail fleets and undertaking projects with the State and Federal government to implement siding enhancements and rail section upgrades already underway.
Mr Macnamara said having just received 21.3mt for the 2021/22 harvest, they've been provided with a really good example of what the average looks like heading into the future.
"We were able to handle that task, but as we move forward we're going to need more permanent storage and that will mostly be bulkhead storage but also permanent infrastructure at up country sites," he said.
"With the 21.3mt crop, 97pc of the tonnes were received at the 100 network strategy sites and we opened about 130 sites in total.
"We think that in big years we will continue to use some of the peak planning sites to handle the task, but in an average year we would receive tonnes at the network sites and we don't see further consolidation beyond that."
In terms of the fertiliser piece, CBH currently holds just under 10pc of the market, but also currently only offers granular fertiliser.
The co-operative is part way through the construction of a new fertiliser facility based next to the Kwinana Grain Terminal.
Once operational, that facility would be able to offer liquid fertiliser as well which will assist in growing its market share.
"Setting these horizons enables us to align our fertiliser strategy with the growing task," Mr Macnamara said.
"If we have an understanding of the crop size, then we can start to back solve for the fertiliser required which enables us to ensure our footprint is suitable to services the growers of WA.
Sign up for our newsletter to stay up to date.