Australia's largest bulk grain handler, Graincorp, has posted a $59 million half-year loss, with the drought bringing down production and impacting business.
In the same period last year the company recorded a profit of $36 million.
Chief Executive Mark Palmquist said the loss was the result of a challenging season driven by dry conditions in eastern Australia.
"East coast Australian grain production was the lowest in over a decade and this has had a significant unfavourable impact on both our grains and oilseeds businesses," Mr Palmquist said.
"[It is] very disappointing, but very much primarily around what's happened in east coast Australia in terms of the drought — the worst that we've seen in over a decade — the greatest impact is on the grains group."
Crop down by almost half
At a Graincorp meeting Mr Palmquist said the loss was easy to understand when you looked at the numbers.
"You can see the impact on the production on east coast Australia this fiscal year, being 7.7 million tonnes [in] winter and summer combined, in comparison to the 16.7 million tonnes in the [previous] fiscal year," he said.
"That means our crop is about 45 percent of what it was last year."
GrainCorp said it expects the challenging conditions in eastern Australia to continue in the second half of the year.
The company is in the process of splitting itself into two business, but on Tuesday Long-Term Asset Partners (LTAP) withdrew its $2.4 billion takeover bid after due diligence.
As a result of the poor half-yearly performance the board will not pay an interim dividend for this period.
