Bunge to work with Wilmar in Vietnam’s ‘tough’ market
Agribusiness majors Bunge and Wilmar are expected to cooperate in Vietnam’s meal market, as the country’s tough market conditions continue to pose challenges for agriculture suppliers, market sources told Agricensus Tuesday.
The shake up comes as Japan’s Marubeni transferred all its operations to Enerfo from November 1 amid difficult trading conditions as the country grapples with an outbreak of African swine fever and slim margins.
The note, seen by Agricensus, states Wilmar Marketing CLV would be the agent for Vietnam Agribusiness Limited, Vietnam Agribusiness Holdings PTE Ltd and Bunge Asia PTE Ltd with effect from November 1.
All three companies are part of Bunge, the B in the ABCD quartet of global agribusiness giants, with market sources saying the statement follows rumours that the two companies had been exploring ways to work together in the country.
According to the note, Wilmar will assume responsibility for sales of soymeal, corn, feed wheat and other agri products.
Vietnam’s feed supply sector has been hit hard by shifting dynamics in its pig sector, with the industry undergoing huge expansion as it catered for China’s pork demand and burgeoning domestic demand.
However, a slowdown in demand from China in 2017 hit the sector hard, before China’s outbreak of ASF spread across the country’s border in early 2019 and infected most of Vietnam within months, with the loss of 5.7 million pigs
The feed sector continues to see major corn imports arriving, with November likely to see up to 1.4 million mt arrive again, as poultry and aquaculture pick up some of the slack.
But the rampant price of pigs domestically is likely to bring further incentive amongst farmers to repopulate their pig herds.
“The market is tough, life is very difficult. People are coming in and out of the market, but people are only losing money in Vietnam trades,” one market source said.
Both Singapore-based Wilmar and US-based Bunge were contacted for comment but Agricensus had received no reply by the time of publication.
Over 140 daily wheat, corn, soy, barley vegoils, meals and freight price assessments
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