World Grain - May 2017 - 16

NEWSREVIEW

Louis Dreyfus Co. expands globally
ROTTERDAM, NETHERLANDS - Louis Dreyfus Co. (LDC) has
continued to expand globally by focusing on each step in the production
process, which has not only allowed the company to react to market
volatility or uncertainties, but also invest in each process from production to logistics.
In its North American operations LDC completed its Mississippi
River logistic network for grain and oilseeds. This included the completion of its 80,000-bushel truck-to-barge loading facility in West
Memphis, Arkansas, U.S. The terminal is currently operational storing
and shipping corn and soybeans along with other ag products grown in
the region.
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grains and oilseeds from the heart of the U.S. to export facilities in the
Mississippi Delta," the company said in its annual report issued in early
April. "This makes LDC an advantageous choice for growers and customers seeking to access global demand for these key crops."
In an attempt to protect from market volatility in its North Latin
America region, LDC said it secured platform origination in advance to
guarantee supply to customers.
"This was particularly key for the Grains, Oilseeds and Fertilizers
and Inputs platforms, working together to ensure the health of our value
chain," LDC said.
In 2016, the company continued with long-term investments in the
region despite short-term volatility.
LDC continues the project in Pará State in Brazil to implement a
sustainable logistics solution. Currently the company is working to establish the best approach to building a transshipment terminal on the

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now under construction in preparation for operations.
In addition to the joint bid LDC won in 2015, the company signed
a lease contract to operate the solid bulk terminal at the Port of Santos
in São Paulo, Brazil, for 25 years. A rail network connects this port to
southern and eastern Brazil and within four years, LDC expects the new
terminal to export 4 million tonnes of corn and soybean annually, "securing our long-term origination capability."
In the South and West Latin America region, LDC focused on improving its processing and logistics.
The company concluded a long-term lease agreement on a grain elevator in Portela, Argentina, and opened its newly-expanded port terminal in Bahía Blanca and the program of improving its loading capacity
at its Timbues facility.
"We remain very well positioned to capture opportunities in Argentina
with our research capabilities, inland elevator network and port terminal
capacity," the company said.
LDC also continued to invest in its value chain integration. The company said it increased sales by diversifying its operations and integrating
further along the value chain.
The distribution of Ukrainian corn and Russian wheat into Egypt is
one of the ways LDC began integrating its operations in the Europe,
Middle East & Africa region (EMEA). At origin, LDC's warehouse netZRUNDOORZVLWWRRULJLQDWHHI¿FLHQWO\IURPWKHSURGXFHU%\RSHUDWLQJLQ
local ports in the region and chartering vessels via its freight platform,
LDC is able to import under its own name in Egypt. Once at the destination, LDC monitors control price and counterparty risk.

Competition a concern in AGT's proposed acquisition of InterGrain
MELBOURNE, AUSTRALIA - The Australian Competition and
Consumer Commission (ACCC) has expressed initial concerns about
the proposed acquisition of InterGrain Pty Ltd by Australian Grain
Technologies Pty Ltd (AGT).
The ACCC's preliminary view is that the proposed acquisition
may substantially lessen competition in relation to the breeding and
development of barley seed varieties for the Australian market.
Wheat and barley breeding involves cross-breeding existing varieties
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as suitability to local soil types or climate, resistance to disease or to
increase yield. Developing and testing a new variety and bringing it to
market generally takes approximately 10 years for wheat and 12 years
for malting barley.
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players in the breeding and development of barley in Australia," said
Mick Keogh, commissioner of the ACCC.
According to the ACCC, AGT is Australia's largest wheat breeding

company and has an expanding barley breeding program, supported
by its international shareholder and partner, Limagrain. InterGrain has
wheat and barley breeding programs with breeding facilities in Western
Australia, South Australia and Victoria.
The University of Adelaide, which until recently competed with AGT
and InterGrain, announced in April 2016 that it was withdrawing from
barley breeding.
"The ACCC is concerned that the loss of competitive tension may
allow the combined entity to reduce investment in the research and
development of new barley seed varieties, and to raise the levels of the
royalties it charges farmers for using its seeds," Keogh said.
The primary revenue source for seed breeders are royalties collected
from growers when they sell grain produced using a particular seed
variety. While AGT and InterGrain also overlap in the breeding and
development of wheat seed varieties, the ACCC's preliminary view is
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constraint from alternative wheat seed breeders and threat of new entry.

IFC loan to support new grain terminal at Black Sea port
KYIV, UKRAINE - The International Finance Corporation
(IFC), a member of the World Bank Group, is providing a $37
million loan to MV Cargo to support construction of a new grain
terminal at the Black Sea port of Yuzhny. The new terminal is
expected to help Ukraine boost its agricultural exports and
contribute to global food security, according to the IFC.
The loan will be used to construct a terminal capable of handling
up to 5 million tonnes of grain annually. In addition to IFC, other
partners in the project include Cargill and the European Bank for
16

Reconstruction and Development. The total project costs are
estimated at about $150 million, the IFC said.
"We have already started the construction works at the Yuzhny
port," said Andrii Stavnitzer, co-owner of MV Cargo. "Our plan is to
have the new grain terminal operational by spring 2018. The works
include the development of rail infrastructure and dredging works.
The deep water port capacities are essential to boost Ukrainian grain
exports further. Actually, it is one of the largest recent investments
in Ukraine."
May 2017 / World Grain / www.World-Grain.com

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World Grain - May 2017

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