A coalition of 60 US associations covering all layers of the economy, from Silicon Valley to oil producers, formed Americans for Free Trade to publicly campaign against the ongoing trade war and urge the administration to ease tariffs. Many in the industry did not believe that the dispute would go this far, with the President now threatening to tax virtually all Chinese imports. The groups warn of layoffs as they face higher costs and smaller export markets.
In a similar vein, Cadbury has joined the list of companies preparing for a hard Brexit and is stocking up on raw materials, including sugar, wheat and cocoa. The UK’s imports will increase by GBP 38 billion (USD 49.37 billion) if companies stockpile three months worth of goods from the EU, according to estimates.
Cargill introduced a software in the Philippines to help the feed and animal industries transition to science-based digital nutrition models. The tool will first be aimed at poultry and swine businesses and will ensure higher margins, according to a company official.
The company has also started meeting startups as part of the CO2 Challenge it launched in June along with Rainmaking and DNV GL. The challenge aims to support technologies which will help reduce the emissions of cargo vessels by 10%. “The solutions are there – we just need to uncover and implement them,” Cargill said.
In the US, Cargill’s Sidney plant in Ohio launched a new USD 10 million line which cuts packaging material waste and uses completely recyclable plastic. This will help customers source sustainable materials.
In Ghana, Cargill said it will expand its direct sourcing programme Cocoa Promise to include four more districts. Under this service, farmers can deliver products to warehouses, effectively cutting out the middleman. This comes at a time when the Cocoa Board is trying to fight the Cocoa Swollen Shoot Virus Disease by replanting 40% of the country’s unproductive cocoa.
The Dacsa Bunge joint venture will build a USD 14 million plant to process corn in Ukraine which should start operating by the end of 2019, according to market sources. Almost 80% of the 100,000mt capacity plant is expected to be destined for exports. Also in Ukraine, the Saudi Agricultural & Livestock Investment Company (Salic) has almost finalised a deal to acquire Mriya Agro, which grows corn and barley among other crops. The takeover would make Salic one of Ukraine’s largest farming operations.
The US investment fund Castlelake is looking into picking up controlling stakes in up to five sugar and ethanol companies in Brazil, according to a source. This comes at a time when a lack of investment in the sector is causing it to shrink. Looking at the finances of 75 mills in the Centre South, Itau BBA bank found that 18 units were not making enough to sustain production. With even profitable mills not investing to expand, because of the poor return on capital, some say that cane production next year could drop by 100 million mt.
During a trip to Morocco this week, the head of Danone promised consumers a series of changes, including lower prices and a more transparent supply chain. This comes after months of a boycott by consumers who accused the company of setting unfair prices, among other things, causing a significant drop in sales. The CEO said the crisis was “unprecedented anywhere in the world”. As such, and although he did not know why the boycott specifically targeted Danone, the company decided it was better to find a solution instead of fighting it.
Similarly, Nestle spent USD 34 million to remove preservatives from two of its main milk brands in Brazil, in response to consumers’ demand for more natural products, adding that developing countries were quickly catching with global food trends.
In the US, the company’s USD 50 million frozen food research centre is paying off, as data showed that frozen food sales jumped by almost 6% in the first half of the year, compared to less than 2% growth over the past two years. Analysts say the revival of frozen food is due to companies like Nestle investing in nutritious and healthy meals, a change from the comfort food that frozen food used to be associated with.
The number of people going hungry around the world increased for the third year in the row in 2017, according to the UN’s latest report. The main drivers were climate change and conflicts, with Africa and South America the most affected. The report also noted that obesity rates now increased to cover one adult in eight. An FAO expert explained that nations were now shifting to offering more humanitarian aid without addressing underlying causes, and should instead focus on promoting transformative investments.
This summary was produced by ECRUU
