KEY POINTS:
CANBERRA - Disgraced wheat exporter AWB has vowed to win back the lucrative Iraq market after losing huge volumes of trade to the United States in the aftermath of the kickbacks scandal.
The company's payment of A$290 million in kickbacks to the former regime of Saddam Hussein resulted
in Baghdad slapping a trading ban on AWB in February pending the outcome of the Cole inquiry into the exporter's illicit payments under the UN oil-for-food programme.
But AWB yesterday said it expected trade between Iraq and Australia to resume, albeit with tougher competition.
"We are making every effort to win back their confidence and support in order to service this market again in the future," AWB International chairman Ian Donges said in the company's annual national pool performance report.
"We expect Iraq will remain a single desk buyer. However, we know that competition for this market will increase ... "
AWB's report on the 2004-05 pool year - which ended before the kickbacks scandal broke - shows the exporter delivered more than 1.3 million tonnes of wheat to Iraq over the 12 month period.
But AWB's shipments to Iraq have fallen away markedly since then, with US exports to the country more than triple the Australian volume last financial year.
"The current political climate will clearly make it difficult for AWB to maintain its market share in Iraq," Donges said.
"While recognising the likely dominance of US imports to Iraq in the short term, efforts will be made to re-establish AWB sales based on quality, price and service."
AWB's data for 2004-05 shows growers earned A$3.1 billion ($3.6 billion) for the pool year, with Indonesia the biggest export market at 2.4 million tonnes.
Donges also issued a warning about export troubles ahead, with this year's drought-depleted crop expected to come it at just 9.5 million tonnes - the smallest harvest in more than a decade.
"It must be understood that there simply won't be enough wheat in Australia this year to supply many countries," he said, adding that AWB expected to complete sales contracts to "core" customers such as Japan, South Korea and Indonesia.
Commissioner Terence Cole will hand his report on the Iraq kickbacks to the Government on Friday, probably recommending criminal charges against current and former AWB executives.
The report also is expected to trigger a big shakeup of wheat marketing.
The Howard Government is likely to strip the company of its right to veto bulk exports by other companies after AWB used the power to scuttle a string of export applications this month.
AWB will release its full year results in Sydney today, having already slashed its profit forecast by up to 25 per cent.
- AAP
