AWB Limited - 2003 Annual Report

For the 2001/02 Pool, AWB managed almost 700,000 individual
grain deliveries requiring 7,180 separate train movements to transfer
that grain, a combined total of two million kilometres to port, from
where it was shipped through more than 3,000 separate bills of sale.
Taking advantage of its market intelligence and expertise, AWB has
also performed well in managing commodity risk for the AWB
National Pool. Participating in the US futures exchanges in Kansas,
Chicago and Minneapolis, AWB capitalised on the strong rally in
world wheat prices late in 2002 (driven by droughts in key
exporting countries such as Canada, US and Australia), to the
benefit of both the 2001/02 and 2002/03 AWB National Pools.
Managing the Wheat Supply Chain
During 2003, AWB improved efficiencies and reduced costs along
the supply chain on behalf of pool participants.
On behalf of AWB National Pool, AWB’s supply chain management
team continues to renegotiate domestic supply chain contracts on
a more commercial basis. For example, in 2003, it signed a three
year contract with Queensland Rail, which will deliver more cost
effective rail rates and reduce the rail assets required for the grain
haulage task.
By publishing Estimated Silo Returns on its website for each and
every receival point around Australia, AWB is providing more
transparency on site to sea costs, and an environment for more
competition in the supply chain.
In the year ahead, AWB will pursue new supply chain service
arrangements with traditional providers, and will introduce new
optimisation technology to better manage and performance monitor
the supply chain program.
Research and Development
AWB has set ambitious targets for its product competitiveness in
international markets. One such aim is to be marketing 60% of its
wheat volumes into Asia by 2007. To achieve this, AWB remains
focussed on its crop shaping activities, working closely with
customers to identify key characteristics and deliver them through
the wheat product .
During 2003, AWB hosted the first ever wheat breeding forum. Key
market signals were discussed with the wheat research and
breeding community to encourage development of new varieties to
meet specific customer requirements.
Grower Services
During the year, AWB met face to face with more than 7,000
growers at various meetings across the country. This year, AWB
extended its highly successful National Pool Forum concept,
expanding on last year’s single event with four forums across four
states this year. AWB’s Grower Services Centre this season
received and managed more than 85,000 grower calls.
AWB also launched a new website during 2003, specifically
designed to meet the increasingly sophisticated needs of growers
and customers. The new site, www.awb.com.au has a dedicated
grower channel which consolidates all relevant information, and will
act as the main business portal for growers’ grain marketing and
finance management requirements.
Outlook
A larger harvest in 2003/04 will mean increased tonnage into the
2003/04 AWB National Pool, and a larger export task for the pool
management services businesses. The world wheat market has
continued its trend of volatility into the 2003/04 financial year, and
should be marked by a return to more normal production levels in
some of the major wheat exporters. AWB is committed to
outperforming the benchmarks for all the services it provides to
operate AWB National Pool, and is on track to outperform the WIB
for the 2003/04 Pool.
INNOVATION FOCUS TO DELIVER NEW OPPORTUNITIES
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