ADM muscles in on Asian grain markets

06 Oct, 2014 12:06 PM
A key part of the export gateway for US agricultural goods to Asia

UNITED States grain giant Archer Daniels Midland (ADM) has expanded a joint venture relationship with Japanese agricultural commodities group Marubeni Corporation to improve its access to Asian grain markets.

The two companies have merged their US-based Kalama Export Company with the Columbia Grain export terminal in Portland, Oregon, previously a subsidiary of Marubeni, bolstering their export capacity from the US Pacific Northwest.

The port is a key part of the export gateway for US agricultural goods to Asia.

The revamped Kalama joint venture will be re-named Pacificor.

ADM, a 19.9 per cent shareholder in Australia's GrainCorp, has had the partnership with Marubeni since the Japanese company bought the US grain business Gavilon last year, giving it a 45pc share of the Washington State based Kalama (which is also 45pc owned by ADM).

"This action represents another important step in our ongoing efforts to build ADM's agricultural services value chain from origination to destination," said ADM senior vice president Joe Taets.

Marubeni's food material division managing executive officer, Satoshi Wakabayashi, said common ownership of the facilities would accelerate both parties' efforts to improve operational efficiency and effectiveness, ultimately providing better service to customers worldwide.

In unrelated past grain takeover moves both Gavilon and GrainCorp were unsuccessful bidders for Australia's national wheat exporter AWB before it was eventually acquired by Cargill.

The latest ADM move comes as it completes its largest acquisition to date, last week closing a $3b-plus deal to buy European food and beverage industry natural ingredients supplier, Wild Flavours.

Andrew Marshall

Andrew Marshall

is the national agribusiness writer for Fairfax Agricultural Media
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Jock Munro
6/10/2014 2:49:17 PM

And I suppose we Australian grain growers are meant to get excited as the powerful merchants strengthen their position even further! Since June 2008, when Rudd and the Liberals deregulated us, we have been like sitting ducks as the multi merchants destroy our quality reputation and reduce the relative value of our wheat.
7/10/2014 5:47:55 AM

Well said Jock. Problem as I see it, is that our "minders" refuse to see the emerging picture. It is going to take our country to be on it's knees before they wake up. Most have forgotten John Darling and what was happening before WW2 when the Feds. stepped in. History will have to repeat itself again.
7/10/2014 11:37:15 AM

It is called "News" Jock. It is not a political statement to inform people about happenings in the rest of the world.
7/10/2014 11:45:28 AM

So Jock and Mug you're saying that by their various blendings the grain merchants are selling what the market doesn't want? Or has the market changed and some farmers don't want to? Wool ... cotton ... similar discussions about market position / quality in the past. The world is not static and farmers can't be too.
7/10/2014 12:52:11 PM

Jaydinsouth, It's called divide and conquer . It pits farmer against farmer for the lowest denominator. Growing wheat is wealth creation.
7/10/2014 1:46:04 PM

Damn straight it is farmer against farmer. I don't know you from a bar of soap Mug. Why should I carry your laziness and ignorance like a parasite? If there was no incentive to be better we would all be sharing misery equally in the goolags.
Jock Munro
7/10/2014 5:19:34 PM

You are a true gentleman dee8 and it takes courage not to hide behind a false name. Jaydinsouth-don't rely on my comments re our declining wheat quality-the buyers are lining up to tell us-I thought that the customer was always right!
7/10/2014 5:22:26 PM

G'Day Deregulate, You've got it wrong mate. I've told you before that I would get on very well with you! Definitely not a bludger ! Always looking for a better way INCLUDING GM, but better managed.
7/10/2014 7:43:21 PM

Deregul8 I bet you are not even a grain grower. If you are I bet you don't belong to a local Fire Brigade but you would expect everyone to come and save you if you had a Fire!
8/10/2014 8:44:28 AM

the evidence is b4 u Jaydin. Buyers are saying our east coast grain quality isn't there anymore (which actually indicates they want quality and will pay more for it). We have bulk handlers who assure the quality to port, but we no longer have any control from there on. Who is to say the merchants aren't mixing that grain from all over aust or the world?, this is not just a container issue it is all exported grain. We lack control over delivery of quality grain to the world market, we need a segregation and an independent (grower owned and not listed) seller.
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