GrainCorp Expects 2016 to be a Tough Year
GrainCorp, Australia’s largest grain handler, had a challenging year in fiscal 2015 after Eastern Australia saw a drop in crop output, which reduced the volume of grain available for the group’s grain logistics, storage, and marketing business.
Total receivals for 2015 topped 7.4 million tons compared to 8 million tons for the year before, leading to a very low carry-in of 1.6 million tons coming in to fiscal year 2016, compared to a carry-in of 1.9 million tons a year earlier.
As a result, GrainCorp’s processing business accounted for 85% of the group’s earnings in fiscal year 2015, with the malt business showing a strong performance as the North American craft beer industry continues to grow.
Looking forward to fiscal year 2016, the low carry-in will be met with what will likely be another small crop, after hot and dry conditions caused by El Niño in September and October put winter crop output at risk in Eastern Australia, leading GrainCorp. to expect fiscal year 2016 receivals and exports to be on par or slightly lower than those seen in fiscal year 2015.