Big agri-biz booms amid global crisis

Leaders from across the world are meeting in Rome for the World Food Summit as people from their countries grapple with the food crisis marked by escalating food prices and shortages.
When they sit down to discuss the situation, they may find it interesting to have a look at the other side of the picture, the agri-business biggies ��� global grain traders, seed suppliers, and fertilizer and pesticide manufacturers ��� who have flourished as food grain prices went wild, and governments scrambled to increase yields.And, the party is just beginning for them because demand for their products and services is bound to grow.
The biggest gainers in this period have been those who trade in grains. Take Cargill, the US-based agri-business behemoth which not only produces, stores and supplies foodgrains globally, but also sells dairy and meat products, processed food products, even salt and organic goods.
It had $88 billion sales and over $2.34 billion profits in 2007, up 52% over the previous year. In April this year, Cargill announced that its profits from commodity trading for the first quarter of 2008 were up 86% over the same period in 2007.
Not far behind is another US grain-trading giant, Archer Daniels Midlands, which raked in over $2.1 billion profits in 2007, a whopping increase of 65% over 2006. Through its huge grain elevator network, it buys, stores, cleans, transports and resells oilseeds, corn, wheat, oats, and barley. It also produces processed food items including cocoa and malt.
Bunge Limited is also a farm-to-consumer company involved in buying, storing and selling grain and oilseeds, apart from selling fertilizer, animal feed and processed food. With over $37 billion sales worldwide, its profit jumped by nearly 50% in 2007.
Although dominated by western companies, the inflamed grain market has led to windfall profits for others too. The Hong Kong-based Noble Group, listed in Singapore and involved in agri-commodities trade and transport, has seen a 95% boost to its profits in 2007 year on year.
Further up the global food value-chain, companies that provide inputs for modern-style agriculture too have made it good. A few years ago, US-based Monsanto was in the red, posting a loss of $23 million in 2003. In 2007, it made a profit of nearly $1 billion. One of the biggest suppliers of grain and vegetable seeds, with penetration round the world, it reported gross revenues of over $8.5 billion.