The monopoly on Australian wheat exports held by the Australian Wheat Board (AWB) could be temporarily broken, according to the country’s prime minister John Howard, in order to secure a A$250m (US$186m) Iraq wheat contract for Australian interests.

The Iraq Grain Board has suspended all dealings with the AWB until an inquiry, headed by former judge Terence Cole, into allegations that AWB made illegal payments to Saddam Hussein’s regime is completed. Cole’s report is due to be passed to the government on 31 March.

“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 wheatgrowers, Howard told parliament.

However, AWB itself today seemed to contradict prime minister Howard’s claims, saying it would only relinquish its export veto after a visit to Baghdad to try and salvage its relations with the the Iraq Grain Board.

AWB chairman Brendan Stewart called the temporary end to its monopoly a “last resort”.