(Adds grain export forecast, CEO comment, background) May 14...

(Adds grain export forecast, CEO comment, background)

May 14 (Reuters) - Australia's GrainCorp (GNC) on Thursday flagged plans for higher grain exports in the second half of the year as widespread rainfall helped the bulk grain handler boost harvests and return to a profit for the first-half.

The company, which has struggled after a three-year drought ravaged farms across the country's east coast and slashed output, said the agri-business was now well placed following improved market conditions and steps to manage crop variability.

While the coronavirus pandemic and the subsequent lockdowns have wreaked havoc on economic activity, classification of food and agriculture industry as essential services helped the Sydney-based firm weather the downturn.

"We are well progressed with our harvest readiness," Chief Executive Robert Spurway said in a statement.

To reduce cash flow volatility, GrainCorp had also locked in a 10-year derivatives contract with insurance broker Aon Plc AON.N last year that would see it receive extra payments in times of drought and lower grain production.

Last month, the Sydney-based firm completed the divestment of its global malting business from its core grain processing division into a separate, listed agribusiness called United Malt Group (UMG) .

Separately, United Malt Group went into a trading halt, pending an announcement on a plan to raise fresh capital.

GrainCorp's underlying net profit after tax came in at A$55 million ($35.46 million) for the six months ended March 31, compared with a loss of A$48 million reported last year.

Revenue for the half year rose 3.4% to A$1.96 billion. The company did not declare a dividend for the half-year.