Geelong’s Corio Quay, with the Midway facility in the foreground. Photo: GeelongPort

GLOBAL agribusiness CHS Broadbent has entered into a Memorandum of Understanding with Australian plantation and carbon management and woodfibre export company Midway Limited to buy a section of its North Shore site in Geelong and construct a grain storage and export terminal.

CHS Broadbent will build and operate the site, which will have the capacity to store 80,000 tonnes of grain.

Under the terms of the MOU, CHS Broadbent will initially lease and then acquire freehold title to five hectares of the Midway site at North Shore to receive, store and export grain from the second half of 2024.

The agreed price for the land sale is $15.5 million, and CHS Broadbent’s grain export volumes will contribute to Midway’s Port volumes.

A joint venture between CHS Inc., a global agribusiness based in the United States, and the Broadbent family, CHS Broadbent is a leading Australian agribusiness supply chain company with grain marketing, storage, logistics and export operations on the east coast of Australia.

CHS Broadbent owns and operates grain storage, container packing and grain freight operations through Queensland, New South Wales and Victoria.

Midway has discussed the prospects of constructing a grain export terminal at the Geelong site for several years.

It initially floated the idea building and operating the facility, but recently announced the intension to find a partner to move forward with the proposal.

Midway Chairman and former CEO of AWB Gordon Davis said the project was a good fit for CHS Broadbent.

“The sale and grain project combine the global infrastructure and customer base with the supply chain strength of the local CHS Broadbent team,” Mr Davis said.

Midway managing director Tony McKenna said the new export precinct was the culmination of negotiations that provided clear commercial benefits for all parties.

“CHS Broadbent gains port access for its first dedicated grain export terminal in Australia,” Mr McKenna said.

CHS Broadbent managing director Steve Broadbent said the announcement was “an exciting step forward for the company”, and would provide more competition in the area.

CHS Broadbent Managing Director Steve Broadbent

“The addition of an export terminal to our supply chain service will see further value delivered to growers, right back to the farm gate,” Mr Broadbent said.

“The terminal will be designed with an annual export capacity of 1.5 million tonnes.

“In an average year, we project we will export around 1Mt which equates to approximately 13 turns per year.”

The sale of the land will settle upon registration of the plan for subdivision and the completion of site development works.

CHS Broadbent intends to refurbish the site, which will include the removal of the old chipping mill and upgrading the existing rail spur into the North Shore site.

Midway’s main chipping line will increase its utilisation, producing E. Globulus, E. Nitens and softwood chips.

CHS Senior Vice President for trading and risk management, and chair of the CHS Broadbent Board, Brian Schouvieller said the Geelong site will be integral to the company’s Australian operations.

“CHS is excited to embark on this key investment in Australia’s newest grain terminal,” Mr Schouvieller said.

“The Geelong location extends our supply chains in the Asia-Pacific region and strengthens our competitive position on behalf of our farmer-owners.”

As part of the MOU arrangement, Midway and CHS Broadbent will fund equally the cost of: upgrading the CQN4 ship-loader to grain standard; a new truck entry point; and site separation.

Midway will also fund development on its retained part of the site for new site offices, new weighbridges for log trucks and an extension of the existing woodchip pad and log yard.

The capital expenditure by Midway for the site alterations to accommodate the new CHS Broadbent grain export terminal is estimated at $4.5M in FY24-25.

Source: Midway Limited