Bunge saw a loss of USD 29 million in the Jan-Mar (Q1) quarter, down from earnings of USD 39 million in the same period last year. However, the company explained that a big part of the losses was due to an increase in forward soybean crushing margins, which means losses should be offset later in the year once the contracts are executed. As a result, it increased the forecast for operating profits this year to between USD 800,000 million and USD 1 billion, compared to USD 550,000-700,000 previously forecast.
On the other hand, losses in the sugar segment increased to USD 24 million mt in Q1, up 40% on year as low sugar prices could not offset the higher ethanol values. Bunge reduced its full-year forecast for operating profits from USD 50-70 million to USD 40-60 million for the sugar division as a result. The company said that it is planning to file for an IPO of its Brazilian sugar mills in May, adding that mills have assured debt financing and can now operate independently. The company had spent over USD 1 billion in its acquisition of the sugar mill operator Moema in 2010.
ADM announced a 16% jump in its profit for Q1 due to better margins and higher soybeans processing volumes in North and South America. However, it is anticipating a USD 30 million negative impact in its Q2 results due to China’s anti-dumping tariffs on sorghum. In combination with DuPont, the group opened a pilot facility in Illinois, US, to make bio-based plastic from corn-based fructose which aims to cut plastic in soda bottles by 25%.
US-based POET dislodged ADM as the world’s top ethanol producer. Previously, both companies had an annual capacity of 1.8 billion gal, which POET expanded to 1.9 billion gal, with a goal of 2 billion gal by 2019, while ADM reduced it to 1.6 billion gal.
The Commodity Futures Trading Commission (CFTC) has fined Glencore Agriculture and Glencore Ltd USD 2 million for breaking trading rules between January 2013 and November 2015. These included breaching speculative position caps and illegal wash deals.
Mondelez International’s profit and sales in Q1 exceeded market expectation due to a strong showing in Europe and emerging markets.
EU members have voted in favour of a near-total ban on the use of neonicotinoids following studies that found its use posed a threat to bees and other pollinators. The sugar beet industry warned this would have a significant impact on yields as there are no alternatives, adding that it threatened the future of the industry.
The head of Unilever said the efforts to source palm oil sustainably were not working well enough, as he noted that deforestation accelerated significantly in 2016. He called on the G7 and G20 to include the topic of food security and sustainability in their agendas. Meanwhile, Greenpeace International has accused Indonesia’s Megakarya Jaya Raya, which supplies palm oil to Nestle, Mars, Pepsi and Unilever, of destroying over 4,000ha of rainforests in the Papua region between May 2015 and April 2017.
UK-based supermarket chain Iceland decided to stop buying products containing palm oil from the end of 2018, saying its production encourages deforestation. The palm oil industry warned, however, that palm cultivation needs less land than other oils.
Leading retailers and food firms such as Walmart, Nestle and Kellogg last week joined a new drive that aims at creating more environmentally and socially responsible global supply chains and ensuring that bonded labour is not used. The Consumer Goods Forum, consisting of around 400 food retailers and manufacturers across 70 countries, is setting up a benchmark auditing and certification system to avoid duplication in audit and promote sustainable sourcing.
Similarly, food industry stakeholders and supermarkets in the UK including Unilever, Nestle and Pepsi will do away with non-essential single-use plastics by 2025 and make sure that the rest of the packaging is recyclable, degradable and reusable as a part of the government’s Plastics Pact. They will also ensure recycling of a minimum of 70% of plastic packaging compared to around 33% now, and use plastic packaging with an average of 30% recycled content.
In the US, the Illinois House of Representatives passed legislation that seeks to permit farm zones in cities deficient in fresh food items. The bill, which will now go to the Senate, also seeks to create a fund from the sales tax proceeds of such farm produce to finance social programmes.
More and more start-ups are looking at plants to replace animal products, such as eggs, milk, cheese and meat, to lower the carbon impact of agricultural productions. Taste, however, is particularly hard to perfectly reproduce and the race is now moving to finding a cheap way to make lab meat. Following the success of Maastricht University who made the first cultured meat in 2013, Cargill is backing Memphis Meats’ effort to make beef, chicken and duck in labs. Nonetheless, making food in laboratories goes against the move to eat more natural and local ingredients, and a former consultant for Monsanto warned that the burgeoning industry needs to manage its image carefully.
This summary produced by ECRUU
