The Lempriere Group is in due diligence to buy Agrium's Landmark agency and trading business.
The deal is estimated to be worth about $1.2 billion, Fairfax Media suggest.
Agrium bought Landmark as part of its acquisition of AWB in 2010 in a $1.2 billion deal.
Landmark has more than 105,000 clients, representing more than 75 percent of all farms as Australia's largest distributor of merchandise and fertiliser as well as being a major wool and livestock trader.
The company's revenue to December 2015 was $2.3 billion ranking it among the top three biggest agricultural companies in Australia behind Graincorp and Nufarm.
Ruralco has also been mentioned as a possible contender for part of the Landmark business.
The fifth-generation Australian business Lempriere Group is partners with the Chinese textile giant Shandong RuYi in 2012, following the joint purchase of Cubbie Station, near Dirranbandi, Queensland.