Wheat marketing in Australia has been in some turmoil since the AWB scandal broke last year linking payments made by the former Australian Wheat Board to Iraq's Saddam Hussein during the oil-for-food program. When the scandal unfolded, the Australian government moved ahead with plans to essentially create more ways for the country's growers to market their wheat.

More recently, AWB had announced it was going to "de-merge" to create a separate grower-owned and controlled single-desk company. However, those plans ended this week when the AWB chairman Brendan Steward said the group did not believe it was "sensible or viable" to put a de-merger proposal to its shareholders.

"However, we will continue to look at ways to reform our constitution and restructure the company when the new wheat export marketing arrangements are introduced in 2008," Stewart said.

He adds that in the interim "AWB will continue to focus on maximising financial returns to pool participants who deliver to the 2007-2008 National Pool and ensure it is a competitive services provider under future wheat marketing arrangements."

Prime Minister John Howard told growers in May they had until March 2008 to create an new entity separate from AWB to control wheat exports. WEMA, an alliance of state-based grower lobbies, was set up after the plan was announced.