AWB may be pushed to its first annual loss in at least 11 years by a retreat after three years from Brazilian, with the group announcing it was slimming down Indian operations too.

The Australian grain handler said its core operations would report pre-tax profits of Aus$90m-100m in the year to the end of September, helped by a better domestic harvest and its expansion into other food commodities.

However, that figure excluded pre-tax losses of Aus$55m-65m at its Brazilian division, blamed on bad debts, lower trading margins and "poor commercial decisions" made by local managers, who were replaced earlier in the year.

The reduction of the division into a representative office will throw up one-off costs booked this financial year, including the write-off of Aus$33m in tax benefits that the wind-down would render unusable.

Fertilizer hit

The group also said it would take an after-tax loss of Aus$15m-17m on its 50% stake in Hi-Fert, the fertilizer business, which had been bit by "unprecedented reductions" in nutrient prices.

And it will swallow Aus$28m-33m in one-off charges relating to litigation, investment losses and costs of shake-ups elsewhere in the company.

AWB said it was also to reduce its Indian business, started four years ago, into marketing and representative office within the Commodity Management division, freeing up about US$25m in capital.

An AWB spokesman confirmed that it was possible that the group, which reported earnings of Aus$65m last year, might fall into the red this year.

The company has not reported a full-year loss since at least 1998, the first year for which historic data  is available on Reuters. 

AWB shares closed down 3.3% at Aus$1.16 in Sydney.