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jerryking : bunge   5

Firms That Bossed Agriculture for a Century Face New Threat: Farmers - WSJ
August 15, 2018 | WSJ | By Jacob Bunge

On any given day, Cargill’s global network may handle up to 20% of the world’s food supply, company officials estimate. Crops like corn, soybeans, wheat and canola remain the fuel for much of the empire.

“It’s the root of the Cargill company,” said Marcel Smits, Cargill’s chief financial officer. Still, he said, “it’s clear that everybody in the industry has had a difficult time over the past few years.”

Among the shifts: low crop prices, farmers with more capacity to store their grain and competition for crops from livestock operations and ethanol plants. Venture capital-backed startups are developing services that scan a wider range of grain buyers or connect farmers directly with food makers.

From 2012 to 2017, Archer Daniels Midland Co.’s ADM -0.33% profits in its grain merchandising and handling division fell 39%. Profits from Bunge Ltd.’s BG -0.26% similar agribusiness division dropped 76%. Cargill’s annual profits fell three out of those years, and the company has pointed to struggles in its own grain business as a factor......

A deeper technology effort is advancing inside Cargill’s corporate campus west of Minneapolis, where Justin Kershaw, the company’s chief information officer, is overseeing a multimillion-dollar investment in data science. The company is hiring technicians and building a “digital labs” unit that can knit together satellite imagery, weather-sensor data and artificial intelligence to get an early read on creeping droughts and places where foodstuffs may run short, he said.

Cargill expects the data-crunching unit to show how the company can run its own trading and logistics operations more profitably, Mr. Kershaw said. But Cargill also will use it to develop crop-planning and futures-market services for farmers.
ADM  agriculture  Bunge  Cargill  commodities  consolidation  grains  farming  threats  food_crops  informational_advantages 
august 2018 by jerryking
Commodity trading enters the age of digitisation
July 9, 2018 | Financial Times | by Emiko Terazono.

Commodity houses are on the hunt for data experts to help them gain an edge after seeing their margins squeezed by rivals......commodity traders are seeking ways of exploiting their information to help them profit from price swings.

“It is really a combination of knowing what to look for and using the right mathematical tools for it,” ........“We want to be able to extract data and put it into algorithms,” .......“We then plan to move on to machine learning in order to improve decision-making in trading and, as a result, our profitability.” The French trading arm is investing in people, processes and systems to centralize its data — and it is not alone.

“Everybody [in the commodity world] is waking up to the fact that the age of digitisation is upon us,” said Damian Stewart at headhunters Human Capital.

In an industry where traders with proprietary knowledge, from outages at west African oilfields to crop conditions in Russia, vied to gain an upper hand over rivals, the democratisation of information over the past two decades has been a challenge......the ABCDs — Archer Daniels Midland, Bunge, Cargill and Louis Dreyfus Company — all recording single-digit ROE in their latest results. As a consequence, an increasing number of traders are hoping to increase their competitiveness by feeding computer programs with mountains of information they have accumulated from years of trading physical raw materials to try and detect patterns that could form the basis for trading ideas.......Despite this new enthusiasm, the road to electronification may not come easily for some traders. Compared to other financial and industrial sectors, “they are coming from way behind,” said one consultant.

One issue is that some of the larger commodities traders face internal resistance in centralising information on one platform.

With each desk in a trading house in charge of its profit-and-loss account, data are closely guarded even from colleagues, said Antti Belt, head of digital commodity trading at Boston Consulting Group. “The move to ‘share all our data with each other’ is a very, very big cultural shift,” he added.

Another problem is that in some trading houses, staff operate on multiple technology platforms, with different units using separate systems.

Rather than focusing on analytics, some data scientists and engineers are having to focus on harmonising the platforms before bringing on the data from different parts of the company.
ADM  agribusiness  agriculture  algorithms  artificial_intelligence  Bunge  Cargill  commodities  data_scientists  digitalization  machine_learning  traders  food_crops  Louis_Dreyfus  grains  informational_advantages 
july 2018 by jerryking
How Glencore AG became a giant in the global agriculture trade - The Globe and Mail
ERIC REGULY
ROTTERDAM, NETHERLANDS
THE GLOBE AND MAIL
LAST UPDATED: WEDNESDAY, MAY 03, 2017

Interested in acquisitions, Glencore AG has accumulated an extensive network of grain assets around the world, and has no plans of stopping
Eric_Reguly  Glencore  soybeans  CPPIB  Argentina  ADM  Bunge  Cargill  Louis_Dreyfus  oilseeds  Viterra  agriculture  growth  opportunities  Rotterdam  grains  logistics  storage  transportation  trading  agribusiness  supply_chains  Marc_Rich 
may 2017 by jerryking
How Steeltown transformed into a booming agrifood hub - The Globe and Mail
Oct. 02 2013 | The Globe and Mail| by BARRIE McKENNA.

“Agriculture is the new steel for Hamilton,” said Ian Hamilton, vice-president of the Hamilton Port Authority and head of real estate development. “Five years ago, the market for steel collapsed. And that’s when it hit home that we had to diversify.”

Since then, the port has attracted $200-million in new investment, including $40-million in various agriculture-related projects, such as new and expanded storage and handling for grains and fertilizer. In 2007, Bunge Ltd. expanded its canola processing plant and Biox Corp. opened a 67-million-litre biodiesel plant at the port....The port has ambitious plans to boost tonnage capacity by expanding rail links that would double the length of trains that can access the harbour, to 100 cars from 50. Efforts are also under way to attract new value-added manufacturers, such as margarine makers, distilleries and breweries plus a flour mill to help feed a nearby Maple Leaf Foods mega-bakery, opened in 2011.
Hamilton  agriculture  Barrie_McKenna  grains  pulses  hubs  exporting  Bunge  agribusiness  waterfronts 
october 2013 by jerryking
Viterra another example of Canadian short-sightedness - The Globe and Mail
ERIC REGULY | Columnist profile | E-mail
ROME— From Saturday's Globe and Mail
Published Friday, Mar. 23, 2012

The point is that Viterra is irreplaceable, certainly within our lifetime. Glencore is nabbing 63 grain elevators and seven port terminals in Canada that could not magically be built overnight should another group of investors decide to clone Viterra.

This industry has massive barriers to entry and that’s why Glencore, led by the ever-savvy Ivan Glasenberg, pounced. For him, it was a once in a lifetime opportunity (and pocket change compared to Glencore’s $45-billion market value). If he didn’t nail Viterra, he knew it would have disappeared into the maw of Archer-Daniel-Midlands, Cargill, Bunge, Louis Dreyfus or any of the other agribusiness heavyweights who know that food isn’t going out of style and that feeding another 2 billion people by 2050 just might translate into compelling growth story....If there is one industry that had a bright future, it was global agriculture and Canada had all the components: Land, water, fertilizer, technology, schools, expertise, infrastructure, agri-business companies. What it lacked was ambition.

Viterra could have been the foundation of a Canadian Glencore or Cargill. Now it’s a piece of someone else’s global vision.
Eric_Reguly  agriculture  agribusiness  barriers_to_entry  Viterra  M&A  mergers_&_acquisitions  farming  sellout_culture  short-sightedness  one-of-a-kind  Glencore  ADM  Cargill  Bunge  Louis_Dreyfus  vision  ambitions  uniqueness 
march 2012 by jerryking

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