A grain trading source said there is so much overlap of oilseed crushing assets between the two companies that the deal looks defensive — a way to keep Glencore from acquiring Bunge. A takeover agreement between Archer Daniels Midland and Bunge has stalled after more than a month of negotiation, reports the Shares of Bunge fell as much as 5 percent after the news came out. But this acquisition was blocked by the Australian Treasurer. However, the company said it is in the process of exiting the sugarcane milling and trade business. Seed mergers, the big three dominate. All eyes are also on Glencore, which up till now has been prevented from making a renewed approach to Bunge because of a standstill agreement.
Bunge last year turned down overtures from Switzerland-based Glencore. The company is Brazil's largest soybean meal exporter, and second largest exporter of soybeans. The magazine also features statistics, regular market reports and in-depth features. Speculation has been swirling about reports that Archer Daniels Midland may be in talks to take over Bunge Ltd. The deal could also face opposition from farmer groups in key agricultural markets, including the European Union, China, India and Brazil, he said.
Large grain traders that make money by buying, selling, storing and shipping crops have struggled in recent years with global oversupplies. This can, in some respects, benefit markets in general. A firm called Vertical Group, which tracks many deals in agriculture, sees big upside from potential synergies. Soren Schroder, Bunge's chief executive officer, acknowledged last year that industry consolidation may be needed amid such challenging conditions. Healthy and open competition in the long-term continues to be the most important feature of any government and of any economic system.
Could this turn into an auction for Bunge? Large grain traders which make money by buying, selling, storing, shipping and trading crops have struggled in recent years with the global oversupply. The firms would have to overcome opposition from U. He said he continues to hope the U. However, it likely would have a bigger impact on farmers outside the heart of the Corn Belt. But declining profits have made the storied firm vulnerable to a takeover, analysts said.
Could this turn into an auction for Bunge? By Hugh Bronstein and P. Our high-quality ingredients from agriculture are in many of the products consumers use and enjoy every day, from grains and meats to salad oils, yogurt and chocolate. If a company has more storage to access, it can use it to move grain volumes to areas of the business where more supplies are needed. We also supply lecithin and other emulsifiers, food acids, corn sweeteners, starches and maltodextrins. Such conditions are widely expected to drive a wave of consolidation among agricultural firms.
So, it's more about how you run your assets that determines your profitability. Currently, a handful of large firms the buying and processing of commodity grains like corn and wheat. The companies would probably need to divest facilities in North America and also possibly in Europe, she said. Speculation has been swirling about reports that Archer Daniels Midland may be in talks to take over Bunge Ltd. We still have a lot of competition in the marketing of grain.
Because the two companies are so large and have so many facilities, any attempt to come together as one is likely to receive scrutiny from regulators in the U. Speculation has been swirling about reports that Archer Daniels Midland may be in talks to take over Bunge Ltd. A merger is an obvious way to accelerate and deepen such savings. Such a transaction will be subject to federal antitrust scrutiny. Quite frequently, shares of an acquirer go down when it announces plans to acquire a company. Department of Justice lawyers have sought out farmers who are opposed to that deal.
In its 2017 fourth quarter financials, Bunge reports near-record results in its edible oils business. However, unlike mergers in the seed business, there still is a fair amount of competition in crop marketing. Such a transaction will be subject to federal antitrust scrutiny. Curtiss distinguished professor in agriculture, emeritus professor of economics at Iowa State University, has been monitoring and writing about consolidation in agriculture for much of his career. Even more, it would send ripples down the agricultural supply chain, affecting American farmers in particular, who would be left with fewer buyers for their corn, soybeans, and other grains. Several outside reports have talked up the combination, and that may make it hard for these companies to not try to unite. In particular, Harl said he has been concerned about concentration in the animal slaughter business, seed production, grain handling, farm machinery and equipment, and control of fertilizer supplies worldwide.
The new fees, though planned before the Amazon acquisition, resemble Amazon tactics in other corners of the retail market. Seed mergers, the big three dominate. FoodIngredientsFirst spoke with key suppliers in the flavors space, who offered their insights into what we can expect to see trending in 2019. Glencore last year sought a tie-up with Bunge in what was viewed as a start of a wave of mergers and acquisitions in the industry. Bunge did not respond to a request for comment. The deal would likely face stiff regulatory hurdles, given the companies' competing grain facilities, shipping terminals and processing plants.
It's creating that marketing arm that reaches all across the Americas and helps streamline how they move product from the farm to the end user. Slideshow 7 Images Bunge can process 18,000 tonnes of soybeans at its Rosario area facilities every day, according to the local grains exchange. There may be a need for divestment of assets such as processing plants and grain silos and this could pave the way for further consolidation in the grains trading industry with competitors snapping up operations. To ensure a smooth leadership transition, Schroder, who has headed the agriculture, food and ingredients supplier since 2013, will continue in his current role until a successor is named. Glencore last year sought a tie-up with grains trader Bunge in what was viewed as start of a wave of consolidation in the industry.