Agricultural Product Seller, Wingara Ag Limited (ASX: WNR) made an announcement on 18 January 2019 stating that it’s Raywood processing facility has received approval from the General Administration of Customs of People’s Republic of China (GACC) to export Oaten hay to China. In the last three years, only three processing facilities have received an export licence for Oaten hay, and Wingara is one of those three facilities.
Besides having an export license to China, the company’s both Epsom and Raywood facilities are having export licenses to Japan, South Korea, and Taiwan for Oaten hay and other fodder products.
This approval is a significant step for the company to penetrate its product in the Asian fodder market which will lead to greater market share and improvements in margin. Earlier the company was expecting to receive this export licence in September 2020; however, it has received the licence well ahead of its anticipation. Now the company is planning to bring forward its site improvements and cost reduction programme at the Epsom processing plant from January 2019. The site improvements and cost reduction programme is in line with the overall medium-term strategy of continuously improving efficiency and building storage capacity to facilitate the existing production capability. Raywood facility was successfully completed and commissioned in November 2018. The commissioning of the Raywood facility was a major milestone in Wingara’s continued development as a multi-product, multi-region and multi-currency platform for Australian primary producers to expand their export potential.
Both the Raywood and Epsom facilities are situated at a critical intersection of major trade routes for primary producers transporting green produce into the port at Melbourne and Geelong, providing a shorter path to market for customers in Wingara’s core catchment zone.
At the time of the commencement of Raywood facility, the company’s Executive Chairman told that the commissioning of Raywood was one of the three major strategic initiatives for FY 2019. He also announced the appointment of Zane Banson to the position of CFO who will help the company to achieve its next step change of growth with the platform now set.
In today’s announcement, the company also informed that it has completed the significant capital improvement works (upgrade) at Austco Polar Cold Storage (APCS). The upgrade will provide APCS greater capacity for blast freezing. Further, the updates will also improve the company’s overall cost efficiency. As per the announcement, Works commenced during the last quarter of 2018 based on greater demand for APCS services from some of Australia’s largest lamb and beef exporters. The capital work has been conducted while the plant was running at 60-65% capacity intermediately and successfully completed commissioning in the second week of January 2019.
In the last six months, the share price of the company decreased by 1.79 percent as on 16 January 2019. WNR’s shares traded at $0.275 with a market capitalization of circa $28.9 million as on 18 January 2019
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