World Grain - October 2015 - 13

NEWSREVIEW

Glencore considers selling stake in
agricultural unit
BAAR, SWITZERLAND - In a move to
reduce its $30 billion debt by $10 billion,
Glencore said on Sept. 7 it is considering a
sell down of its agricultural unit.
In a release, Glencore said approximately
$2 billion could be raised from the sale of assets, including, but not limited to, proposed
precious metals streaming transactions and
the minority participation of third-party strategic investors in certain parts of Glencore's
agriculture assets, including infrastructure.
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Kalmin told Bloomberg News that the move
could entail taking on investors in its agricultural infrastructure assets including its
ports, or the sale of a minority stake in the
entire agricultural unit. He noted that there
has been increased interest in food commodities from Japanese and Chinese sovereign
wealth funds. Mitsubishi Corp. announced
in July the acquisition of 20% stake in commodity trader, Olam International and last
year, COFCO Corp., China's largest food
company, acquired controlling interests in
Noble Group and Nidera BV.
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Glencore's chairman, said the company was
considering expansion of its agricultural
business. Glencore expanded its presence in
the agriculture industry with the purchase of
Canadian grain trader Viterra, Inc. in 2012
for $4.6 million.
But agricultural production has been on a
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growth, against a backdrop of a stronger U.S.
dollar. Commodity prices are now at levels
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09 and various markets appear increasingly
driven by perceptions and technical factors
rather than reality or fundamentals.
On Aug. 13, Glencore reported that its
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volumes were in line with the prior period,
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Switzerland-based Glencore is one of the
world's two biggest wheat traders, handling
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one of the top three agricultural exporters in
Russia, Canada, Australia, and the E.U.
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World Grain - October 2015

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