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Wesfarmers eyes Asia food boom

Wesfarmers managing director Richard Goyder and chairman Bob Every at the Perth Convention & Exhibition Centre for the Wesfarmers AGM yesterday. Picture: Danella Bevis/The West Australian.

Former Coles boss Ian McLeod is investigating investment opportunities which could see Wesfarmers return to its agricultural roots as the industry shapes up for an Asia-fuelled boom.

Managing director Richard Goyder said Australia had great prospects for food production as long as supply chains became more efficient.

"I agree that there's a significant opportunity in agriculture," Mr Goyder told Wesfarmers' annual meeting yesterday

"There are going to be opportunities for strong agricultural businesses to be successful in time in the years ahead.

"We're having a look at it at the moment. Ian McLeod's doing a bit of work on it for us."

Since leaving Coles mid-year, Mr McLeod took up the position of group commercial director, which includes scouting for investment opportunities.

Speaking after the meeting, Mr Goyder said any potential agribusiness investment would be "forward-thinking" rather than harking back to Wesfarmers' historic farm services businesses.

"We'd love to be a participant in expanding the opportunity for Australian primary producers if we can find a way," he said.

"But me saying that and actually delivering on something are two quite different things."

The managing director said free trade agreements with the giants of Asia did not necessarily ensure things would automatically happen for food exports.

"We need to have really efficient supply chains and we don't."

On the competition regulator's court actions over Coles' treatment of suppliers, Wesfarmers chairman Bob Every conceded during his speech there was no doubt the supermarket operator had made mistakes in the past.

"Coles has taken many steps to seek to avoid similar problems in the future," Dr Every said.

"We believe Coles' current relationships with its suppliers are now much improved."

The Australian Competition and Consumer Commission yesterday gave the green light to Wesfarmers buying Pacific Brands' workwear business.

ACCC chairman Rod Sims said the $180 million deal was unlikely to restrict access to the Hard Yakka, KingGee and Stubbies brands by resellers and other retailers.

"Industry feedback suggests that brand loyalty has diminished over recent years as customers become more focused on quality, price and service," Mr Sims said.

'There are going to be opportunities for strong agricultural businesses to be successful.' " Wesfarmers managing director *Richard Goyder *