CBH finalizes long-term agreements with grain marketers

by World Grain Staff
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WEST PERTH, AUSTRALIA — The CBH Group said on June 30 that it has finalized Western Australia’s first set of long-term agreements (LTAs) with grain marketers.
 
The new system allows marketers to obtain port capacity for five years, providing grain marketers with long-term commercial certainty.
 
Approximately 6 million tonnes of additional short-term capacity will be available on a first-in, first-served basis.
 
CBH Group’s General Manager of Operations David Capper said the LTAs offer long-term certainty for both growers and customers.
 
"Our customers have been asking for this type of arrangement for some time. We are very pleased to announce that a constructive process of consultation and a series of successful commercial negotiations have resulted in 10 marketers securing approximately 10 million tonnes of LTA capacity," he said.
 
"The flexibility that the LTAs provide allows us to offer a record 16 million tonnes of capacity and to service a record number of grain exporters. For growers the LTAs mean that there is committed competition for the first 10 million tonnes of production before the crop even goes into the ground.”
 
The first-in, first-served system for short-term capacity will also offer new entrants an attractive option for capacity, further increasing competition for the benefit of WA growers, Capper said.
 
“Having a long term commitment to Western Australia also offers a stronger incentive for grain marketing companies to invest in people on the ground in WA, to service their accumulation needs,” he said.
 
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