UPDATE: THE Federal Coalition has accused the government of abandoning Australia's grain growers.

The coalition argue that the government has let grain growers down by not opposing a takeover bid of AWB's old commodity business.

Yesterday the Foreign Investment Review Board (FIRB) gave the all-clear to US company Cargill's purchase of AWB Limited's Commodity Management Business.

It follows similar approval given by the competition watchdog in March.

Nationals senator Fiona Nash said the purchase will see Cargill controlling the majority of Australia's grain operations, with only one other big player, Graincorp.

"It will become the Coles and Woolworths of grain trading, potentially leading to less competition and lower prices," she said in a statement on Wednesday.

"Growers are rightfully concerned this will also lead to foreign dominance in the marketing of Australian grain.

"The treasurer, Wayne Swan, has the authority to stop the sale from happening (but) it appears he is completely clueless."

Senator Nash said Mr Swan should have the final say, and urged him to step in to stop the sale for the good of Australia's grain industry.

Cargill Australia had already been advised by the Australian Competition and Consumer Commission it would not oppose the purchase of AWB's commodity arm.

Cargill Australia managing director Ralph Selwood welcomed the decision by the Federal Government.

"We will now proceed rapidly to conclude the transaction and begin the integration process to bring the two businesses together," Mr Selwood said.

Agrium president and chief executive officer Mike Wilson said his company was also pleased the necessary government approvals had been obtained.

"This will allow us to focus our efforts in Australia on what we do best, bringing value to our grower customers through our retail Landmark business," Mr Wilson said.

"Likewise, we believe Australian grain growers will further benefit from Cargill’s expertise in grain handling and international marketing."

But the FIRB's approval was met with disappointment from the NSW Farmers Association, which had heavily lobbied Federal Government and Opposition Members of Parliament, to stop the acquisition from going ahead.

NSWFA grains group president Mark Hoskinson said he was extremely disappointed with the decision.

"It's a sad day for the Australian wheat industry," Mr Hoskinson said.

Victorian Farmers Federation grains group president Andrew Weidemann said the federation was comfortable with Cargill buying the AWB grain operations off Agrium.

Mr Weidemann said the VFF initially had reservations Cargill might scrap pool options and the AWB brand plus deny other grain traders from posting prices at GrainFlow receival sites, but these had now been allayed.

"Nobody wants to see Australian companies sold off to overseas investments," he said.

"Victorian growers are more concerned about service, accountability in price and whether they are going to be paid.

"But many farmers have been selling to Cargill for more than 30 years."

The deal includes 22 GrainFlow grain storage sites in Victoria, NSW, South Australia and Queensland, plus rail agreements and rolling stock.

It includes AWB's share of the Shenzen business in China, but not its interest in the Five Star Flour Mill in Egypt.

Mr Selwood also said the acquisition would not yet include AWB’s interest in the Melbourne port terminal, as it remained "subject to third party consents and waivers".

He said Cargill would continue to use the AWB brand in the domestic market and "where the brand can help secure premium pricing to benefit Australian growers in international markets".

The company would also continue to operate wheat and barley pools in Australia while there was a demand for such products.

Mr Selwood also committed the company to providing open access to other grain buyers and provide pricing transparency at all the GrainFlow sorage sites.

"AWB's grain business is a freat fit with our existing grain and commodity trading operations," he said. 

"Combining two strong organisations means we can offer grower access to more international grain markets, and our Australian and international customers access to high quality grain through an efficient distribution system."

with AAP