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The Albany Port Authority has warned that moves by Chinese interests to establish their own grain handling facilities will be weighed against the potential to attract mining exports.

Representatives for giant Chinese conglomerate Beidahuang have begun talks with the authority about investment in grain loading facilities as part of plans to create an independent supply chain to China.

Beidahuang has plans to buy or lease up to 100,000ha of farming land in the Wheatbelt.

Port chief executive Brad Williamson said Albany was keen to attract new trade but suffered from being an agricultural port and not a mining port.

Mr Williamson is deep in negotiations with Cazaly Resources about iron ore exports from Albany and has begun preliminary discussions with another mining company. “We have available land and berthing capacity but port land is a scarce resource,” he said.

“We don’t want to make it so cheap and accessible that it creates unnecessary duplication of infrastructure. There is a balance between providing sufficient land to allow competition but not so much as to prevent new trade starting.”

It is understood initial discussions about Chinese grain exports have been based on relatively small volumes of about 250,000 tonnes a year.

The authority and Cazaly, which has been frustrated by delays in the expansion of Esperance port to service the Yilgarn mining region, are waiting for engineering and logistics reports on exporting iron ore.

A decision is expected early next year.

Cazaly managing director Clive Jones and Mr Williamson said any deal would be subject to the necessary approvals and a substantial rail upgrade.

“We are looking at Albany as an option and not just an interim option,” Mr Jones said.

“Albany has the potential to get us into some sort of production at least.”