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SA, European firms in agribusiness JV

4 July 2011

South African firm Senwes is entering into a joint venture with the European division of Bunge, a leading global agribusiness company, to develop grain and oilseed operations in South Africa both for the domestic market and for export to African countries.

Senwes will contribute its expertise and access to local and regional grain markets, as well as its high-quality infrastructure, while Bunge will provide its expertise in global commodity markets as well as its specialised international logistics capabilities.

Bunge, which is listed on the New York Stock Exchange, buys, sells, stores and transports oilseeds and grains to serve customers worldwide.

It also processes oilseeds to make protein meal for animal feed and edible oil products for commercial customers and consumers; produces sugar and ethanol from sugarcane; mills wheat and corn to make ingredients used by food companies; and sells fertiliser in North and South America.

"This joint venture represents a solid platform for Bunge's growth in Southern Africa," Bunge Europe CEO Jean-Louis Gourbin said in a statement earlier this year. "Bunge has found the right partner to expand its activities in the region and complement its expertise and competitive advantages in logistics, access to global markets and risk management."

Contributing to regional food security

The integration of local, regional and global grains and oilseeds value chains is expected to enhance efficiencies in the local and regional markets, bring value to producers and end users of agricultural commodities and contribute to food security in the region.

Senwes, which operates within the agricultural sector with focus in the Free State, North West and Gauteng provinces, and has its head office in Klerksdorp, in the North West, will benefit from Bunge's expertise and capabilities in international grain and oilseed sourcing, logistics and risk management.

"Senwes is excited to be able to share in this opportunity, as its growth strategy of product and market risk diversification is being executed, amidst volatile and uncertain global economic times, which will contribute to ensure the sustainability of our business whilst adding value to our customer base and contributing to the development of the African sub-region," said Senwes MD Francois Strydom.

The agreement is expected to become effective during the course of this year, subject to receipt of regulatory clearances, including from the South African Competition Commission.

SAinfo reporter