Bunge’s profit beats expectations as grind margins boost agribusiness unit By Reuters

© Reuters. FILE PHOTO: Soybeans are loaded onto a truck February 17, 2020. Picture taken February 17, 2020. REUTERS/Jorge Adorno/File Photo

By Karl Plume and Arunima Kumar

(Reuters) – Bunge Ltd reported a stronger-than-expected 17.1% rise in adjusted quarterly profit on Wednesday, as major oilseed crops in North America and Europe and strong demand for processed meals and oil have strengthened its main agribusiness unit.

This strength would continue into 2022, the global ag trader predicts, amid growing demand for food and biofuels and tighter crop supplies, though the segment is unlikely to match the record performance. from last year.

Shares rose about 1% in early trading.

“We’ve had good momentum since the fourth quarter,” said general manager Gregory Heckman. “Although we didn’t expect Q1 to be as strong as last year, which was really amazing, we got off to a very good start.”

Bunge (NYSE:) The results offered the latest insight into how multinational grain companies have weathered shifts in demand and supply chain disruptions caused by the COVID-19 pandemic.

Bunge and rival agribusinesses are now benefiting from improved demand for food and renewable fuels as some pandemic restrictions ease.

Traders, however, are facing higher commodity costs as crop prices jumped due to a poor harvest in South America, while energy costs are near multi-year highs.

Forecasters have cut crop estimates for Brazil, the world’s largest exporter of soybeans and main supplier of corn, due to unfavorable weather conditions. Drought in Argentina reduced crop prospects there.

Bunge expects adjusted earnings of at least $9.50 per share for 2022, which the company says would be the second highest in recent history.

The company posted adjusted net income of $533 million, or $3.49 per share, in the quarter ended Dec. 31, compared with $455 million, or $3.05 per share, a year earlier.

That topped an analyst consensus estimate of $2.87 per share, according to data from Refinitiv Eikon.

Revenue totaled $16.683 billion, up from $12.61 billion a year earlier and above an analyst estimate of $15.167 billion.

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