flying*, page-2

re: flying* maybe ......article may not be flying for long.
Howard said ``You can have a single desk without AWB Ltd. AWB's future and the single desk are two separate issues.''
And now ABB, Graincorp and CBH group are selling to Iraq.


ABB Grain, GrainCorp, CBH Group to Sell Wheat to Iraq (Update3)
March 3 (Bloomberg) -- Australia's ABB Grain Ltd., GrainCorp Ltd. and CBH Group have won a contract to sell wheat to Iraq, seizing an opportunity to replace Australia's monopoly wheat exporter AWB Ltd. in the nation's third-biggest market.

The three will work together to fill the order for as much as 350,000 metric tons of wheat, the companies said, after AWB agreed not to exercise its right to veto rival companies filling the order while it's under investigation for allegedly paying kickbacks to Saddam Hussein's regime to win sales.

Prime Minister John Howard has questioned AWB's monopoly on wheat exports, through the so-called single desk, as the nation seeks to salvage its relationship with Iraq and farmers seek buyers for their second-biggest crop on record.

``As an industry, we cannot afford to sit back and see valuable markets lost and we are very pleased to work collaboratively on behalf of Australian growers,'' the three grain companies said in a statement e-mailed to Bloomberg News.

Shares in AWB have slumped 36 percent since the inquiry started Jan. 16, plunging to their lowest in more than 2 and 1/2 years on March 1. They rose 26 cents, or 7 percent, to A$3.97 at the 4:15 p.m. close in Sydney on the Australian Stock Exchange.

Shares in ABB, the nation's biggest barley exporter, have gained 8.5 percent since the inquiry started and stock in GrainCorp, eastern Australia's biggest grain handler, has risen 10 percent.

Willing

``AWB has confirmed that it is willing to provide access for Australian-owned grain trading companies to wheat from the national pool,'' Trade Minister Mark Vaile said in a statement. ``I encourage AWB to work expeditiously with these three companies to secure this opportunity.''

Australia, the world's second-largest wheat exporter, sold 1.5 million tons of wheat to Iraq in 2004-05 according to the Australian Bureau of Agricultural and Resource Economics.

On Feb. it raised its estimate for the latest wheat harvest by 3.7 percent to about 25 million metric tons. Total wheat exports could be worth A$4.1 billion ($3 billion) in the year ending June 30, 2007, according to Abare.

``AWB International believes that this arrangement is a positive outcome for Australian wheat growers,'' the company's spokesman Peter McBride said today from Sydney.

Separate Issues

Retired judge Terence Cole is investigating claims made in a United Nations report by former U.S. Federal Reserve Chairman Paul Volcker that AWB inflated wheat contracts and funneled $222 million back to Hussein through a Jordanian-based trucking company. Iraq last month refused to deal with AWB during the Cole inquiry.

``You can have a single desk without AWB Ltd,'' Howard said yesterday. ``AWB's future and the single desk are two separate issues.''

Growers welcomed today's contract announcement.

``It's the chink in the armor, there's no doubt about that,'' John Watson, a wheat grower from Victoria state said from his farm 330 kilometers (186 miles) north-west of Melbourne about the contract. ``Even if we had lost it (Iraq's market) for a short period of time, I don't think we would've lost it for ever.''