Ag Giants Reporting Profits from Trading
China is loading up on American corn and soybeans and profits from oilseeds processing have rebounded
The world’s largest agricultural commodity firms are finally making money from trading again, reports AJOT.
After years of lackluster returns as bumper crops curbed the volatility traders need to thrive, the stars seem to have aligned for the likes of ADM and Bunge Ltd.
China is loading up on American corn and soybeans, profits from oilseeds processing have rebounded, and a drought in Brazil is boosting prices. Even the beleaguered biofuels market is improving.
“There’s really strong demand and a fight for execution, so it’s a better operating environment because of the improved demand outlook,” Paul Maass, CEO of Scoular Co., told AJOT. “I think the whole market feels that.”
That’s a stark turnaround for an industry that was stuck with thin margins as farmers increased storage capacity and gained access to more information, relying less on grain handlers at a time when seed development meant big yields year after year.
Read the full report here.