CBH Group Chairman Neil Wandel said CBH and Western Australian growers were now stakeholders in the most modern and integrated grain port facility in Southeast Asia, with both import and export capability.
The new port terminal is on the Thi Vai River at Ba Ria-Vung Tau, 100 kilometers southeast of Ho Chi Minh City and 35 kilometers from the open sea.
It is operated by Interflour Vietnam Ltd, part of Interflour Holdings, one of Southeast Asia’s largest flour milling groups, owned in partnership by CBH and the Salim Group of Indonesia.
Interflour Vietnam also announced it would undertake a major expansion of its flour mill in Ba Ria-Vung Tau, doubling its capacity to 1,000 tonnes per day to meet rapidly increasing demand as consumers switch from rice to flour-based products in Vietnam.
“The opening of the Interflour Vietnam grain port terminal, and the start to the expansion of the flour mill here, are important financial and symbolic milestones in the history of Interflour and in its close relationship with Western Australian growers,” Wandel said. “We are happy to be a part of these developments and we congratulate all those who have contributed to making it happen.”
Wandel said Interflour’s use of wheat from Western Australia had increased significantly since CBH first invested in its six flour mills in Indonesia, Malaysia and Vietnam in 2004.
“Our changing environment meant that we, as growers, needed to look at getting a direct stake in the grain value chain beyond the farmgate and getting closer to our customers,” Wandel said.
“We wanted to do more to “drought-proof” our business by diversifying our income, to secure and increase our access to rapidly growing markets, to ensure more of the value generated beyond the farmgate came back to growers and to create more value for growers by helping Interflour to improve and expand its operations.
“To date, most of Interflour’s profits have been reinvested into growing the business, including the expansion in Vietnam. However, CBH is now getting dividend payments from Interflour and the outlook is promising. This is particularly timely, helping to balance the inevitable negative impact on CBH’s financial performance of the drought we are now enduring in Western Australia.”
Interflour Chief Executive Officer Greg Harvey said the new port terminal was a state-of-the-art facility with significant competitive advantages over other ports in Vietnam and Southeast Asia as a whole, including much faster unloading rates and the ability to accept bigger ships.
“The investment in the terminal and the expansion of the flour mill reflect the strong growth Interflour has been able to achieve in Vietnam and the positive outlook for flour demand,” Harvey said.