WEST PERTH, AUSTRALIA — CBH Group Chairman Neil Wandel told members at the group’s Annual General Meeting on Feb. 26 that a record 2011-12 crop has allowed it to absorb many of the cost increases and avoid passing them onto growers.
Wandel said the cooperative has kept storage and handling fees flat and reduced rail freight rates this year, while committing an additional $40 million over the next three years on network upgrades.
“In 2013, we will keep our storage and handling fees flat. It is currently estimated that growers in WA pay A$14 per tonne less than growers in Eastern Australia, who currently pay around A$40 per tonne, in storage and handling fees. This does not include freight to port,” he said.
“Through our rail investment and having our fleet of locomotives and wagons come online over the last 12 months, we’ve also been able to reduce rail freight rates by an average 7%, providing additional savings for WA growers.
“One of the main ways we can return value to growers is by investing in their supply chain to ensure it remains the most efficient and low cost in the country. We have done this by committing an additional A$40 million over the next three years on network upgrades, specifically focused on increasing site turnaround times. This investment is in addition to the annual commitment on capital expenditure.”
At last year’s AGM address, CBH Group Chief Executive Officer Andy Crane said the record volume of the 2011-12 season was expected to result in a significant turnaround in CBH's financial performance from 2010-11. He forecast a profit of close to A$100 million.
Crane was able to confirm a net profit after tax of A$162 million for 2012.
“The marketing and trading division recorded a strong result, after acquiring more than 6.3 million tonnes of grain across Australia, including more than 40% of the WA harvest along with shipping more than A$2.6 billion in grain during 2012, up from A$1.5 billion in 2011,” he said. “Meanwhile, our flour mills helped achieve a profit after tax of A$7 million attributable to the co-operative.”
Crane said while the just completed harvest did not live up to the previous year’s record, CBH still expects to present another positive result to grower members next year, including the flow on effects of the new rail fleet.
Derek Clauson of North Yelbeni officially joined the board as an elected member director following the recent election in District 2, replacing Mick McGinniss.
"On behalf of my fellow directors and our grower members, I welcome Derek Clauson and thank Mick for the valuable role he played on the board for almost 10 years," Wandel said. “I would also like to congratulate Kevin Fuchsbichler and Trevor Badger on their re-elections which will ensure the continuity and stability of the board.”