AAAC Outlook Conference
Chris Aucote
Bunge Australia
November 2013
Employees: ~35,000
Facilities: ~400
Countries of Operations: 40+
Key Facts
Agribusiness Sugar & Bioenergy Food & Ingredients
• A global leader in
oilseed processing
• A global leader in
grain and oilseed
marketing
• Leading producer of
oils, margarines &
industrial fats in the
Americas and Europe
• Growing oils position
in Asia
• Leading corn and
wheat miller in the
Americas
• 20 mmt sugarcane
milling capacity
producing sugar,
ethanol and electricity
• #2 in global trade and
distribution
Fertilizer
• Fertilizer blending/
distribution in Brazil
• Fertilizer operations
in Argentina and the
U.S.
• Joint venture with
OCP in Morocco
Long-Lived Assets
About Bunge … A Leading Global
Agribusiness & Food Company …
* Market Cap $US11.86B at 26 Nov 2013
35%
35%
17%
6% 6%
Agribusiness
Sugar & Bioenergy
Fertilizer
Food & Ingredients
Other
Bunge- a global food and agribusiness
company
Commenced business in 1818 in Amsterdam.
Significant business interests in grain and food assets worldwide.
Operating in Australia since 1923.
Flour mills/feed mills/piggeries/food business operated in
Victoria/NSW/Queensland.
In mid 1990’s business rationalised due to the heavily regulated grain
markets.
Deregulation of the grain markets in the mid to late 2000’s led to Bunge
being more actively involved in the market.
Key figures- Port Facility
$30-40M investment in rural and regional WA
50K upright storage
• 6x 8000mt
• 4x500mt
Road based intake system
Dual truck discharge pit
Automated truck sampling- 2 weighbridges
Truck staging area nearby
Fixed point shiploader loader
Loading rate 1000mt/hr
Berth to be shared with woodchip company
Bunbury construction November
WAPRES- Bunbury shiploader
Grain and oilseed markets
Wheat, barley and canola markets have been in downward trend
US corn market has been the primary bearish factor depressing
world grain markets….canola a different story….and currency.
12 month downtrend
12 month downtrend
Wheat- current situation World wheat carryout- unchanged 12/13 to 13/14>>>178mmt
Australian production ranges 24.5-25.5mmt
• Harvest progressing well
• Varied quality
• Strong export program 19-20mmt
Argentina
• 9mmt crop
• Exports to South American markets only
Canada crop at record 33.2mmt
• Large export program
• Quality good, limited downgrading, average protein
EU
• Large production 143mmt, but big export>>>small increase in c/out
Wheat continued
Black Sea
• Russian/Ukraine production lower than expected
• Exports front ended
• Values up $45 from harvest lows>>> priced at EU levels
• Flow in Asia… Bangladesh/Indonesia…now very slow
• 2014 planted area down>>>> but not a disaster
US
• The residual supplier of world wheat
• Stock reducing from 30% to 23%
• HRW( Kansas) carryout tight due to the increased Brazil flow
India
• 5-6mmt exports>>>>recent tenders prices not as cheap as thought
Wheat market drivers
Short term
• Demand-China/Brazil/Iran
• Australian crop size/quality and grower selling
• Indian tenders
• Final Argentine wheat crop
• US futures spec short
Long term
• Northern hemisphere crop development>>no issues at this point
• Major importer demand profile
• US corn stocks overhang the market… new crop plantings
• Grower selling
Canola
Market weighed down by record Canadian crop--- reports of up to
18mmt…Canadian STU ratio from 4% to 16%.
Australia 2nd biggest crop.
Demand for canola strong with China>>>global oil prices aligned
Short term
• Aussie canola now priced into Europe and China
• Strong grower selling in Australia
• Slow selling in Canada
Long term
• Tight world soybean situation
• 3 years of tightness
• Expanding oilseed production global oilseed production>>risk for
acreage.
Canola-market direction
Consolidating trend
UPSIDE??
Barley
Australia looking at largest crop in 7 years…8-9mmt
• Harvest progressing well- malt receivals are lower than expected
• Malt premiums starting to widen
• Export surplus of 4.5mmt
Argentine still a major competitor with potentially 2.8 mmt of
exports
Saudi demand well covered into 2014
China purchases are on track.
East coast feed demand
Overall depressed feed grain prices keep a lid on barley prices
Currency
THANKYOU