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South Australian grain co-op signs up for port pact

by Grain Central, 20 November 2017

EYRE Peninsula Co-operative Bulk Handling Limited (EPCBH) in South Australia has signed a memorandum of understanding (MoU) to develop a new grain distribution and supply chain network using Iron Road’s planned rail and port facilities at Cape Hardy.

The pair will work collaboratively to establish a grains export business using the multi-commodity port.

A $210,000 Australian Government grant through the Farm Co-operatives and Collectives Pilot Program (Farming Together) was used to develop a project business case.

EPCBH plans to improve the competitiveness of the region’s grain industry by using a collaborative approach to enhance returns to growers and farm businesses.

Group spokesperson Bruce Heddle said EPCBH sought to pursue opportunities arising from the proposed development of Iron Road’s new port facility for the benefit of co-op members and the broader community.

“The MoU signifies a concerted effort to work collaboratively with Iron Road with a view to positively impacting the grain industry across the Eyre Peninsula,” he said.

Formed in August 2017, EPCBH aims to enhance returns to growers and farm businesses using a collaborative approach.

During the past 10 years Eyre Peninsula farmers have grown an average of 2.5 million tonnes of grain each year, with over 90 per cent of that grain exported.

Mr Heddle said the ‘farm to customer’ cost structure on the Eyre Peninsula was relatively high and the negotiation of a MoU with Iron Road signalled the start of a process to address this.

The MoU with EPCBH is complementary to Iron Road’s existing partnership with Emerald Grain, a wholly owned subsidiary of Sumitomo, where the two parties are working together.

In a statement to the ASX, Iron Road managing director, Andrew Stocks, said: “The approved deep water port at Cape Hardy will be a first for South Australia and a fresh approach to infrastructure development in the region.

“We believe the development of multi-user facilities with cross-commodity access for other industries, such as grain, will open up substantial additional export and import opportunities and maximise benefits at regional and state levels.”

Farming Together program director Lorraine Gordon said: “This collaboration is a good example of the way the Farm Co-operative and Collaboration Program supports agriculture from the grower upwards. The program is farmer-driven and has attracted unprecedented levels of engagement.”

The Farm Co-operative and Collaboration Program is a two-year, $13.8m initiative from the Australian Government’s Agricultural Competiveness White Paper, designed to help agricultural groups value-add, secure premium pricing, scale-up production, attract capital investment, earn new markets or secure lower input costs.

The program is being delivered by Southern Cross University on behalf of the Australian Government.

It comprises a highly experienced senior team drawn from a wide range of commodity groups from across Australia and is backed by an industry advisory group representing experts from Western Australia, Northern Territory, Queensland, Victoria, South Australia and NSW.

Regional Development Australia Whyalla and Eyre Peninsula recently called for preliminary expressions of interest for export, import and other opportunities at the proposed Cape Hardy port.

“We welcome the partnership with EPCBH and look forward to working with them and others to advance this exciting part of the project,” Mr Stocks said.

Source: Iron Road Limited, Farming Together Program

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