26 July 2012 17:06 [Source: ICIS news]
HOUSTON (ICIS)--An expected smaller harvest of corn and soybeans in the US will prompt South American farmers to commit large acreages to those crops later this year, US agribusiness Bunge said on Thursday.
"We expect to see a massive planting by farmers in the southern hemisphere, and big North American plantings next year in response to strong global demand and high crop prices," said Alberto Weisser, Bunge chief executive, in a conference call with investors.
Bunge earlier Thursday reported that second-quarter 2012 net profit fell by 13.3% to $274m (€225m) as adverse weather conditions hit its sugar and bioenergy business.
Second quarter sales were up 4.2% at $15.09bn.
The company's sugar and biorefinery business had been hit by rainy weather in Brazil, which reduced the sugar content of harvested sugarcane.
Sugar and bioenergy performance should improve in the second half of 2012 as sugar yield typically improves after July when there is more recoverable sugar in the cane, Bunge said.
Bunge projected that for the 2012/2013 marketing year (1 July-30 June), it will produce 252,000 tonnes of sugar in Brazil and 57.3m gal (216.9bn litres) of ethanol.
The company said it is on track to reach its planting target of 70,000 ha (172,900 acres) of sugarcane this year.
In regards to its fertilizer business, Bunge said that South America is entering its annual high-volume period, with 60% of expected fertilizer purchases to be made in the second half of the year.
($1 = €0.82)
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