Harshita Swaminathan

(Reuters) – Graincorp announced Friday that it anticipates underlying profits for fiscal 2022 at around 2.5x the level of the previous year. This is due to supply shortages resulting from the Ukraine War, which has sent Graincorp’s shares to a new record.

Australia, which is sixth in world wheat exports, will ship record volumes this year, as buyers search for replacement cargoes. [nL3N2VB1MM]

Graincorp’s shares rose 8.9% to A$9.46 in the most dramatic rise ever.

Robert Spurway, Chief Executive Officer of Graincorp said that the conflict in Ukraine has caused uncertainty on global grain markets and buyers are looking for alternative sources.

The company claimed that the ports of its fleet were near full capacity in spite of disruptions from flooding along the east coast.

Since March, both the western and eastern coasts of Australia have seen a surge in bookings.

RBC Capital Markets analysts stated, “GNC continues benefit because ultimately their logistical assets act as a block to exports which allows them price control – extremely advantageous when the supply chain is tight”.

Graincorp anticipates an annual underlying net loss after tax of between A$310million and A$370million ($231.82 million- $276.72million), which is higher than its prior forecast of A$235million to A$280million and much more than last year’s A$139million.

Refinitiv’s expectations for A$266.2 Million net income in the year were also exceeded by the upgraded forecast.

According to the company, its oileed business is also doing well due to strong demand from global markets for refined and crude vegetable oils.

This was also due to improved crop seasons and export supply chain margins, which support its better profit outlook.

($1 = 1.3371 Australian dollars)