Farmer and consumer groups warn that the planned agricultural megadeael uniting Bunge and Glencore-backed Viterra could leave farmers with fewer alternatives for selling crops and drive up consumers’ prices for food.
Skeptics said the deal would give Bunge greater sway over grain markets and production of staple food products such as vegetable oils and bread. The result would be less competition for farmers’ crops and between makers of basic foodstuffs and ingredients, they said.
Joe Maxwell, chief strategy officer for Farm Action, a Missouri-based group that advocates for farmers, said absorbing Viterra would give Bunge a troubling degree of control over ports and grain terminals and create potential bottlenecks in the agricultural-supply chain.
“Other grain traders could be blocked from the export and import markets,” said Maxwell, whose group plans to urge antitrust authorities to block the deal.
Bunge said folding in Viterra’s operations will only improve the supply chain of buying and selling crops for farmers. Bunge Chief Executive Officer Greg Heckman said Viterra has a sizable grain-distribution network across the U.S. and Canada that can be used to feed Bunge’s coastal ports for exports and processing plants to make vegetable oils, biofuel and animal feed.
We are not in a lot of the same places, and where we are, we’re not in the same businesses,” he said.
Bunge, the largest oilseed processor in the world, and Archer Daniels Midland, Cargill and Louis Dreyfus make up the so-called “ABCDs” of global commodity trading.
Four companies account for about 90% of the global grain trading and processing market, according to a report from the Agriculture Department on competition in the industry.
Thomas Gremillion, director of food policy for the Consumer Federation of America, said the deal seems likely to harm farmers, consumers and companies, such as plant-based food manufacturers, which rely on certain commodities.
Larger farm trade groups, including the American Farm Bureau Federation, National Corn Growers Association and National Farmers Union, declined to comment on the deal, representatives said.