Open letter from Manildra Group to grain growers:

Dear Australian grain growers,

As a consequence of severe back-to-back drought years, Manildra Group has been granted an import permit by Australia’s Department of Agriculture and Water Resources (DAWR) to import high-protein Canadian wheat.

John Honan

For 67 years we have been buying wheat exclusively from local growers in Australia and, like you, we are committed to a sustainable grains industry.

We know our national reputation depends on our biosecurity import standards and we are committed to these strict industry safeguards set by DAWR.

We continue to use 100 per cent Australian wheat at our three New South Wales flour mills at Gunnedah, Manildra and Narrandera.

Our domestic wheat logistics is fully booked through to the end of calendar 2019, with trains drawing supplies across Australia to service these mills.

East-coast grain growers, from whom we traditionally source our high-protein wheat, had a very poor harvest in 2017 and 2018.

This has left a shortfall of high-protein wheat required for our value-added exports, including gluten and starch, produced at our Nowra, NSW plant.

We have safeguarded the future of our plant by importing high-protein wheat, and we have an ongoing requirement to continue this through to the end of calendar 2019.

Our preference is to use Australian wheat, and we will continue to buy high-protein wheat from local growers as supply permits.

Manildra Group is the largest buyer of wheat in Australia, and larger than most of Australia’s export markets including Japan, Korea, Vietnam and Malaysia.

Our demand accounts for more than 50pc of the east-coast milling market, and more than 70pc of the NSW milling market.

Our presence underpins a strong competitive market for local grain.

We purchase Australian wheat every year, including this year.

In response to potential wheat supply following Western Australia’s bumper harvest, Western Australia does not have the suitable high-protein wheat that is critical to our Nowra plant operations.

Whilst having to take this step to shore up the supply shortfall, Manildra Group continues to support the efforts of grain-grower groups to introduce a transparent stock reporting system to better inform supply-and-demand decisions by growers and buyers.

Above all, we share the high hopes of our growers and customers for a better grain season in 2019.

Additional facts

• This is the first time in Manildra Group’s 67-year history that exceptional drought circumstances have forced the requirement to import;
• In 2019 to date, Manildra Group has purchased more than 1 million tonnes of Australian wheat;
• Manildra Group employees more than 1000 people directly, and thousands indirectly, across regional NSW;
• Manildra Group first advised DAWR of its import needs in August 2018, after carry-over stocks were critically low and crop prospects across the eastern seaboard were failing. This process included consultation with grower organisations;
• DAWR has determined all the strict biosecurity standards for the import of high-protein wheat and has conducted extensive audits to establish biosecurity protocols at Port Kembla and at the Nowra plant;
• Imported high-protein wheat will be exclusively processed at the Nowra plant to supplement domestic grain supply;
• Imported wheat will be discharged at Port Kembla and transported by rail in sealed containers manufactured for this purpose;
• The Nowra plant is a fully closed loop system, whereby no product leaves the plant unless it has undergone rigorous heat treatment to meet biosecurity standards.

Source: Manildra Group