Australia’s ‘major role’ in feeding the world is more clear than ever, grain boss says

The head of a global commodity fund ramping up investment in Australia says the nation is crucial to “feeding the world” and has flagged plans to export more than 1.5 million tonnes of grain from various Australian ports. Simon Arnold — co-founder of global commodity trading company Aria Commodities — visited Perth this month for the first time since the Dubai-headquartered company was founded in 2017. Aria Commodities has offices in Dubai, across Europe and the US, and recently partnered with WA-based company AAAX Agricultural Exports to bulk ship and trade grain from CBH Group’s ports. Mr Arnold said Aria had set its sights on shipping more than 1.5mt of grain from Australian ports, as global wheat supplies tightened and Australia continued to produce large volumes of grain. ARIA and AAAX, which stands for Australian-Asian Agricultural Exports, last year set up a venture called ARIA AAAX Australia and signed a long-term port terminal services agreement with CBH to bulk export grain from its ports. ARIA AAAX Australia shipped its first bulk shipment in February, 66,000t of wheat, to the Philippines. Mr Arnold — who is also Aria’s head of trading and risk — said the partnership played into its broader ambition to increase how much grain it exported from Australia. Together, they are also eyeing East and South Australia as a locations to accumulate and trade grain for bulk exports. and trading for container and bulk exports. “We have ambition to increase exports from Australia and we are increasing through loading slots,” he said. “Australia has been an increasing exporter of grain and it really does have a major role to play in feeding the world.” Aria was founded in 2017 and deploys investor funds in commodity infrastructure across the world. It hit headlines this month when it was approved as the funding partner for Peninsula Ports’ $250m Port Spencer grain export facility. The new deep water port, in South Australia, is expected to be operational by the 2023 harvest. Mr Arnold said Australia’s supply chain challenges — which for WA in particular have hamstrung exports at a time when prices are high and demand is strong — presented an opportunity for investment in grain infrastructure. Mr Arnold said the long-term port terminal services agreement with CBH Group had been a boon for the companies. ARIA AAAX Australia has secured seven slots from CBH this year, starting with the first to the Philippines in February, two to Vietnam in April, one to Yemen in May, and a planned one to South Africa in June. It also has two further slots allocated for July and September and is still finalising those shipments. ARIA AAAX Australia deploys Clear Grain Exchange’s settlement service to settle grain purchases, meaning growers retain title of their grain until they are paid and giving ARIA AAAX Australia a foothold in the highly competitive grain export market, and provided some certainty for both farmers and buyers of grain. “Our strategy is proving itself to work using investor funds and providing a return,” Mr Arnold said. Mr Arnold said with a good outlook for grain exports from Australia, ARIA AAAX hoped to attract new destinations for grain rather than adding to the competition of supplying to existing destinations. “Australia is hitting the ceiling in terms of the capacity to export grain, we have more grain domestically that we can export,” Mr Arnold said. “The world is not going to stop eating grain. We see regularly that disruptions can cause a problem in supply.”