Angry farmers lash out at AWB failures Blair Speedy From: The Australian December 24, 2009 12:00AM Increase Text SizeDecrease Text SizePrintEmail Share
Add to DiggAdd to del.icio.usAdd to FacebookAdd to KwoffAdd to MyspaceAdd to NewsvineWhat are these?WHEAT growers have slammed the board and management of AWB Ltd for turning their backs on the farmers the company was originally intended to serve.
In a demonstration outside the company's Melbourne headquarters before its annual meeting, third-generation wheat farmer and shareholder Mark Dwyer compared the company's $460 million capital raising earlier this year, which shifted majority control of the company from growers to institutions, to the Iraqi oil for food scandal.
"I don't see the difference between what went on in Iraq and the kickbacks they've just made to institutional shareholders by selling shares at $1 when the price was $1.25," he said.
AWB was in 2005 discovered to have paid almost $300m to Saddam Hussein's Iraqi government under cover of a UN humanitarian program, a scandal that in July 2008 led the federal government to strip the company of its "single desk" monopoly on bulk wheat exports.
Start of sidebar. Skip to end of sidebar.
Related CoverageGrain trader plummets Herald Sun, 10 Feb 2009
AWB fends off a third lawsuit The Australian, 1 Oct 2008
Growers get choice on export Herald Sun, 11 Sep 2008
AWB granted wheat export licence Daily Telegraph, 11 Sep 2008
AWB to end dual class structure Adelaide Now, 3 Sep 2008
.End of sidebar. Return to start of sidebar.
Grower Jock Munro said that, in losing the single desk, growers had also lost a range of crucial services previously supplied by AWB, which had functioned as a buyer of last resort and allowed growers to borrow against the value of their future harvest.
Now, rather than sell their wheat into a national pool, growers were holding on to their grain in hopes of getting better prices, and in the process incurring storage costs and risking further price falls.
"A company that we once owned and built up over 60 years is now a basket case," he said.
Farmers were being made to pay for the mistakes of the AWB directors and management in Iraq, he said. "The only losers have been growers." He said growers had lost an estimated $1bn because AWB no longer hedged wheat prices, while the lack of co-ordinated marketing meant Australian wheat had lost market share to Canada, where a single desk export monopoly was still in place.
During the meeting, chairman Peter Polson -- who was appointed in October 2008 -- said he and the rest of the board had had "absolutely nothing to do" with the decision to scrap the single desk system and that farmers had no choice but to get used to the idea.
"The people that have stood up and said they are upset about the loss of the single desk and that AWB is no longer a statutory authority -- that animosity in Jock's lifetime will not disappear.
"The nature of AWB has changed, and there's no denying it -- we have competitors we've never had before and the world is a very different place," he said.
Shareholders later voted by a 54 per cent majority to reject the company's remuneration report, which included bonuses to senior executives despite the company reporting a net loss of $248m for the 2008-09 financial year.
Add to DiggAdd to del.icio.usAdd to FacebookAdd to KwoffAdd to MyspaceAdd to NewsvineWhat are these?WHEAT growers have slammed the board and management of AWB Ltd for turning their backs on the farmers the company was originally intended to serve.
In a demonstration outside the company's Melbourne headquarters before its annual meeting, third-generation wheat farmer and shareholder Mark Dwyer compared the company's $460 million capital raising earlier this year, which shifted majority control of the company from growers to institutions, to the Iraqi oil for food scandal.
"I don't see the difference between what went on in Iraq and the kickbacks they've just made to institutional shareholders by selling shares at $1 when the price was $1.25," he said.
AWB was in 2005 discovered to have paid almost $300m to Saddam Hussein's Iraqi government under cover of a UN humanitarian program, a scandal that in July 2008 led the federal government to strip the company of its "single desk" monopoly on bulk wheat exports.
Start of sidebar. Skip to end of sidebar.
Related CoverageGrain trader plummets Herald Sun, 10 Feb 2009
AWB fends off a third lawsuit The Australian, 1 Oct 2008
Growers get choice on export Herald Sun, 11 Sep 2008
AWB granted wheat export licence Daily Telegraph, 11 Sep 2008
AWB to end dual class structure Adelaide Now, 3 Sep 2008
.End of sidebar. Return to start of sidebar.
Grower Jock Munro said that, in losing the single desk, growers had also lost a range of crucial services previously supplied by AWB, which had functioned as a buyer of last resort and allowed growers to borrow against the value of their future harvest.
Now, rather than sell their wheat into a national pool, growers were holding on to their grain in hopes of getting better prices, and in the process incurring storage costs and risking further price falls.
"A company that we once owned and built up over 60 years is now a basket case," he said.
Farmers were being made to pay for the mistakes of the AWB directors and management in Iraq, he said. "The only losers have been growers." He said growers had lost an estimated $1bn because AWB no longer hedged wheat prices, while the lack of co-ordinated marketing meant Australian wheat had lost market share to Canada, where a single desk export monopoly was still in place.
During the meeting, chairman Peter Polson -- who was appointed in October 2008 -- said he and the rest of the board had had "absolutely nothing to do" with the decision to scrap the single desk system and that farmers had no choice but to get used to the idea.
"The people that have stood up and said they are upset about the loss of the single desk and that AWB is no longer a statutory authority -- that animosity in Jock's lifetime will not disappear.
"The nature of AWB has changed, and there's no denying it -- we have competitors we've never had before and the world is a very different place," he said.
Shareholders later voted by a 54 per cent majority to reject the company's remuneration report, which included bonuses to senior executives despite the company reporting a net loss of $248m for the 2008-09 financial year.
fire me an email mark@bratrudag.ca.
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