Under Australia's single desk monopoly system, AWB can veto exports of bulk quantities of wheat to overseas markets.
Company chairman Brendan Stewart and Prime Minister John Howard met in the capital Canberra on Wednesday to discuss a decision by the Iraqi Grains Board to suspend relations with AWB pending the outcomes of the Cole inquiry.
That inquiry is looking at alleged kickbacks made by Australian companies to the regime of former Iraqi dictator Saddam Hussein under the United Nations' oil-for-food program, including alleged payments of $300 million made by AWB.
Mr Howard told parliament that in his discussions with the wheat exporter, AWB Ltd had agreed to give up its veto in relation to the current tender on offer from the Iraqi Grains Board.
"AWB Ltd has indicated its willingness on a voluntary basis not to exercise its veto on this tender, if necessary to secure a positive outcome for Australian wheat growers,” Mr Howard said.
But AWB Chairman Mr Stewart has told reporters that there are other options to explore before the company goes down that path.
Asked if the company was temporarily forgoing its monopoly on wheat exports, Mr Stewart said: "Absolutely not."
"We've got to get this into perspective, that is a last resort. We have said to the prime minister if we have to use that, then we absolutely will, but we think there are other solutions that can be found."
Delegation to Iraq
Australia will also send a delegation to Iraq as soon as possible to talk to the new Iraqi government about ways to secure Australia’s long term wheat interests.
"The delegation's goal is to protect the interest of Australian wheat growers, and the value of the wheat in the Australian pool," Mr Howard said.
"The delegation will explore all options to secure the continued access of Australian wheat to this important market,” he added.
The delegation will be headed by Deputy Prime Minister Mark Vaile and will include Mr Stewart.