by PressBunge Ltd revised its forecast for annual profit
Agribusiness company Bunge expects high profits this year
The agribusiness company Bunge has changed its profit forecast. The company’s earnings guidance was driven by an increase in vegetable oil sales, which boosted revenue by 14%. The company estimates that adjusted profit for the current year will be more than $8.5 per share. At the same time, Bunge’s stock rose 4.5%.
According to the company’s analysis, major grain traders have already recovered from the pandemic and are actively increasing turnover. At the same time, trends in the world have changed, which affected the demand. For example, during the lockdown, people began to cook their own food more instead of eating in cafes and restaurants. As a result, food and fuel sales increased. There has been a record increase in demand for vegetable oils, and they are in demand not only from food businesses, but also from clean fuel producers. Last quarter, Bunge reported profits in the refined and specialty oils sector of $113 million. By comparison, for the same period last year, the figure was only $48 million. Net sales were up, although adjusted earnings were slightly lower than previously projected.
Bunge, a U.S. company, has facilities in various countries, including Brazil. The latter is the world’s largest exporter of soybeans, but production has been down this season. Crop declines have affected Bunge’s processing facilities in Brazil, and profits there have fallen.
The company was founded in 1818 in Amsterdam and has a leading position in the grain market. Bunge is represented in 40 countries and has many food production and processing plants. The company is the largest producer of vegetable oil and supplier of soybeans.
In Ukraine and Russia, it owns the brand Oleina, which offers sunflower oil. In addition, the company supplies the market with margarine, mayonnaise, sugar, grain mixes, flour and other products.
Another major line of Bunge is the production of phosphate fertilizers, which is concentrated in South America. In Ukraine, the company operates several oil extraction plants, as well as a number of grain traders. Russia is considered one of Bunge’s main sunflower suppliers worldwide.
In 2005, the company established a biodiesel joint venture with a French partner. Now the capacity of the plant is estimated at 430 thousand tons annually, which are delivered to Italy, Germany and Austria. Bunge plans to expand this area in connection with the implementation of the strategy of carbon neutrality, which many countries are striving for.