McCormack asks Swan to stop Sunrice sale (ABC)

McCormack asks Swan to stop Sunrice sale

Posted 5 hours 13 minutes ago

• MAP: Leeton 2705

The Nationals Member for Riverina is calling on the federal treasurer Wayne Swan to prevent the foreign takeover of Sunrice.

Shareholders will vote at the end of this month on a $600-million offer received from the world's biggest rice company, Ebro of Spain.

Last week, the sale was given the green light by the Foreign Investment Review Board.

Michael McCormack says Sunrice is an iconic company and it should not be sold out of Australian farmer ownership.

He says he has written to Mr Swan with his concerns.

"I think that Mr Swan as the treasurer needs to really look closely at this," he said.

"Because I think if we sell out Sunrice to a Spanish corporation, I think we will be in real trouble as far as food security is concerned, as far as a farmers' co-operative is concerned and I really think the treasurer needs to have a good hard look at this and intervene," said the MP.

Serious Rice Farmers

Serious Rice Farmers will not want to lose control of Sunrice. Owning Sunrice is like owning a Header and trucks for transport – rather than using contractors. They will make more money and have more control and certainty of selling their rice.

 They will also have a good investment beyond the farm gate, employment in the district for their families who have to move off the farm, and be building an asset for longer term security, retirement and something to leave to children and grandchildren.

Mr Thorburn 

Peter Hemphill Weekly Times April 27,2011

Peter Hemphill |  April 27, 2011

AN independent expert has found a foreign bid for NSW rice processor SunRice a good proposal.

Lonergan Edwards & Associates, which was commissioned by the SunRice Board to assess the takeover proposal by Spanish food conglomerate Ebro, released its extensive report, concluding the bid was "fair and reasonable and in the best interests of both the A and B-class shareholders in SunRice in the absence of a superior proposal".

If rice growers accept the bid by Ebro, it will see another Australian grain company fall into foreign hands, following ABB Grain being sold to Canadian grain company Viterra in 2009 and AWB being sold to Canadian fertiliser giant last year.

Ebro has offered $50,000 for each A-class SunRice share and $5.025 for every B-class share to secure the company.

The SunRice board said Ebro’s financial offer for B-class shares was a “significant premium” to recent share trading prices.

The A-class shares currently cannot be traded.

The board is supporting the Ebro proposal, saying it would offer greater benefits to SunRice shareholders than other options.

SunRice has convened a meeting for May 31 at Jerilderie to approve the takeover.

There is significant opposition to the bid, with the company’s largest B-class shareholder Julian Menegazzo saying he will vote against the proposal.

Ebro must secure support of at least 75 per cent of A-class members and 75 per cent of B-class shareholders to win control of the company.

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Our future is bright and reassured given the strength of our people, brands and relationships the world over

Kim Woods

September 2, 2010

AFTER several years in a drought-induced wilderness, the rice industry is on the rebound.

This year's 205,000-tonne crop from the Riverina and Murray Valley and record-breaking yields of 11.5 tonnes a hectare have been the heart-starters.

AT A GLANCE
• What: rice
• Why: fortunes on the rebound
• Where: Riverina
• Report: KIM WOODS

With major water storages filling, growers are keen to start sowing the 2011 crop within the next few weeks.

Smiles are also returning in the milling sector after several years of tight grain stocks and challenging global markets.

SunRice's mill at Leeton, in the Murrumbidgee Irrigation Area, is one of the most modern in the world with a processing capacity of 275,000 tonnes of rice a year, valued at $260 million.

SunRice chairman Gerry Lawson said Australia produced the best rice in the world.

"Our clients are clamouring for it," Mr Lawson said.

"With the record yields and the water allocation carried over to this season, there is a renewed sense of optimism that we will turn the corner on the drought."

Rice growers attending the Ricegrowers Association of Australia's annual meeting recently were given a rare opportunity to tour the Leeton mill.

With several hundred staff, the mill is a major employer.

The high grain quality of this year's harvest has resulted in good yields at the processing plant.

Shifts at the mill have been ramped up from one to three.

Nothing is wasted with by-products heading to a SunRice subsidiary, Coprice, to be converted into products ranging from calf bedding to dog food.

The milling process starts with various cleaning stages to remove the hull from the grain.

During grading, a colour sorter uses ultra-violet light to take a digital image of individual grains travelling on a conveyor belt at three metres a second. Pulses of air remove the imperfect rice grains.

Machines then polish the grain to produce white table rice.

Pollard is a by-product of the process and is used to make flour, breads, biscuits and snack foods.

In the packing plant, five automated lines sort products for domestic and export markets.

In the past year, shifts have doubled to bag the rice into packs ranging from 500g to 25kg.

Rice-cake production began in 1988, puffing the rice grains under temperatures of 260C.

With three new flavours launched this year, the rice cakes are exported to New Zealand, US and Middle East.

SunRice has also moved into convenience snack foods producing a chocolate rice bar using the popular medium-grain variety amaroo.

Ready-to-go and microwavable rice are major growth areas.

By-products of the value-adding processes are converted to stock and pet feed at the nearby Coprice plant.

Coprice began in the 1970s simply bagging rice hulls and bran but now production involves grinding, adding trace elements and pelletising the product. At Leeton, production is geared to extruded dog and cat food and feed supplements.

SunRice chief executive officer Gary Helou said SunRice was pursuing a vision of being the world's favourite rice food company.

"Our future is bright and reassured given the strength of our people, brands and relationships the world over," he said.

(Weekly Times, September 2, 2010)

Kim Woods Weekly Times April 22 2011

Kim Woods |  April 22, 2011

NSW rice growers are hailing a return to the "good old days" with a million-tonne crop planned for next year as headers harvest the current crop.

About 30 per cent of growers plan to expand their area under rice to help with weed control, reduce herbicide costs and as a break crop.

This is despite this season's run of mice damage, boggy harvesting conditions and some of the lowest prices in years.

Twelve hundred growers in the Murray, Coleambally and Murrumbidgee irrigation areas have already delivered 342,000 tonnes of the expected 800,000 tonne crop.

Average yields have ranged from a low 7.5-8 tonnes/ha in the Murray Valley to 12-13 tonnes/ha in the Murrumbidgee.

SunRice chief executive Gary Helou said the industry may be on track to planting a million-tonne crop next year.

But Mr Helou refused to be drawn on 2010-11 first-advance prices, saying shareholders would be officially updated soon.

NSW Department of Primary Industries leader rice farming systems John Lacy said grower feedback put next year's crop at 1.2 million tonnes.

"There is a lot of water available for the next crop," Mr Lacy said.

Many crops had suffered 5-10 per cent mice damage, with hot spots at Griffith and Deniliquin.

"The mice have been worse near crossovers, dams and lodged stubbles, and where grain was dropped on the ground," he said.

Leeton grower Steve Dufty is wrapping up his 150ha harvest of langi and sherpa varieties.

"This is up from zero last year and a 40ha crop in 2008 damaged by locusts," Mr Dufty said.

"It is good to have anything in the rotation."

Mr Dufty said mice damage had been restricted to the crop perimeters.

"We started harvest on April 1," he said.

"This is later than normal due to cooler weather.

"The crops were sown aerially in late October and early November because of the plague locust risk."

On the back of an average water use of 9ML/ha, Mr Dufty expects sherpa to yield an average of 12.5 tonnes/ha.

With first-advance long and short grain prices under $200/tonne, he is unsure about sowing rice again next year.

Last week his neighbour, Dean Walsh, was busy harvesting 243ha of langi and sherpa.

Although Mr Walsh was achieving average yields of 10 tonnes/ha, boggy conditions were prolonging harvest.

Growers are now waiting for an independent review, due late this month, on the proposed $600 million buy-up of SunRice by Spanish company Ebro.

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Ebro offer timetable

The Scheme Booklet will be dispatched to SunRice shareholders on 27 April 2011 and is expected to be uploaded onto the NSX and SunRice websites that day.

SunRice to convene meetings for SunRice shareholders to consider and vote on the Ebro proposal. These meetings, for both A Class and B Class shareholders, will be held at the Jerilderie Civic Hall on 31 May 2011.

Michael McCormack Member for Riverina 24 February 2011

There is also considerable uncertainty in the Riverina due to a $600 million takeover bid for SunRice by the Spanish food giant Ebro. SunRice employs more than 600 highly skilled and qualified people in Australia and an additional 700 overseas. SunRice is a valuable Australian owned food business and one of the largest rice food companies globally. SunRice typically feeds up to 40 million people per day in more than 60 countries with high-quality Australian grown rice. Ebro is the world’s largest rice producer and has its sights set on SunRice in an attempt to increase its Asian presence. The Madrid based company has even improved its bid to buy SunRice by extending its commitment to buying rice at the benchmark Californian paddy price from five to seven years. Ebro has offered a good price at a time when rice growers are understandably wondering about their future.

Of course, a takeover of this magnitude brings the Foreign Investment Review Board into play. The Treasurer will also ultimately decide the fate of the deal. I am fearful that farmers who want to remain in the industry will be left in the lurch. Many other sectors—for example, dairy with the buyout of cooperatives—have found that the short-term financial gain to individual members is outweighed by long-term impacts such as reduced farm gate prices through the loss of market power. Companies can make guarantees for seven years, but what happens after that? We will not be able to control the price and we will not control any of the assets. While the decision comes down to individual investors or grower shareholders, farmers should recognise that once they lose majority control the focus of these operations will shift to the interests of the overseas shareholders. It is a deal which raises more questions than it gives answers in a region which, at the moment, needs confidence, not more uncertainty.