GLENCORE Grain has refuted grower allegations it will unmercifully cancel a large number of unfilled grain contracts despite recent wet weather throughout the State's Wheatbelt.
The grain trader's WA manager Rob Haddrill said Glencore wouldn't cancel grower contracts but instead, might not be able to extend a number of them past their allocated closing dates, as it had done in previous years.
He blamed a combination of CBH's Quality Optimisation (QO) system, recent widespread rainfall and the logistical issues which came with the rain, for the tightening of the current accumulation situation.
Despite complaints made to Farm Weekly by a number of Upper Great Southern and Great Southern growers about the cancelling of contracts by a number of WA traders, Mr Haddrill said it was a difficult situation that wasn't as black and white as some growers had thought.
"Most WA traders, including Glencore, have a large number of December contracts to fill," he said.
"There are a lot of overseas buyers and customers who are up in arms waiting for their grain to arrive and are not really showing much sympathy for the delay here in WA."
Historically, December was an important month for grain exports out of WA.
This season traders had to juggle the delicate situation by helping growers to sell as much grain as possible while adhering to their contractual agreements with overseas customers.
"CBH's QO system has caused some delay in grain transfers and made it very tight from an export point of view for all the buyers," Mr Haddrill said.
"Obviously the rain hasn't just affected the farmers and their ability to harvest the crop, but it's also affected CBH's ability to the move the grain.
"It's a tough situation.
"Obviously if we get on the wrong foot with customers overseas it can have some pretty dire consequences for WA's reputation and grains industry.
"We're not saying we're going to cancel contracts but they do have an expiry date, as they all do and we really need our grain by the end of the month because it comes down to us being able to stick to our contracts as well."
Mr Haddrill said Glencore couldn't provide a black and white overview of the situation to its growers because if WA experienced two weeks of clear weather and transfers against its contracts started again, then it would be able to fill its boats and get disembarked on time, leaving room to extend what ever contracts remained.
"It's just a case of making sure we can get the transfers into our contracts so we can get the boats away," he said.
"Unfortunately CBH can't load a vessel unless the wheat is in a trader's name.
"Although we have enough grain on our books, we can't load a boat because the physical tonnes haven't been delivered yet."
In previous years Glencore and other WA traders easily extended grower contracts because programs were more widely spread.
This season growers could only try to fill as much of their contracts as possible before the expiry date and hope for an extension if enough physical tonnes were committed and delivered to CBH receival sites.
Mr Haddrill said Glencore was stuck between a rock and a hard place and generally farmer feedback had been very considerate.
"Growers understand where we are placed," he said.
"Of the farmers I've spoken to, 95 per cent of them understand that a contract is a contract and we have to fulfil our contracts too.
"Out of a nine or 10 million tonne crop this season, there is already about eight million tonnes in the bin so it's not like nothing has been harvested.
"The pressure comes because hardly any of it has been transferred."
But one Great Southern grower said if the shoe was on the other foot and companies like Glencore couldn't pay out grower contracts, farmers like himself who had struggled to get their crops off due to rain delays, would just have to sit idle and wait for their money.
"I've got about 1500 tonnes of APW tied up in Glencore contracts," he said.
"Of the four contracts, one expired on December 15 and the others will expire on December 31.
"The tonnes are locked in anywhere between $315 a tonne and $335/t.
"Prices are dropping off all the time and today's prices is about $190/t.
'It's a major loss.
"It's just a question of why are they happy to extend some contracts and not others, when they're contracts for the same grade of grain are destined for the same boat out of the Albany port zone in early January."
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