USA- Commodity trading giant Bunge Limited has reported its second-quarter 2023 results, revealing an EBIT of US$785 million in its agribusiness unit, which is up from US$93 million in the second quarter of the year 2022.
Bunge, which recently merged with Viterra to become one of the largest grain merchants in the world, revealed that its net income soared in this quarter in general, thanks to impressive performance in various segments.
“We delivered strong results as we successfully navigated a highly dynamic quarter through agility and discipline, capturing opportunities while continuing to serve our customers at both ends of the value chain,” Greg Heckman, Bunge’s Chief Executive Officer, commented.
According to the report, higher agribusiness results in the quarter were primarily driven by soft seed crush and strong Brazil soybean origination, which also contributed to higher crush results in Brazil, and our destination crush operations in Europe, Asia, and the US were also higher than last year.
However, higher results in global oils and grains were more than offset by lower results in our financial services and ocean freight operations, which had difficult comparisons to a particularly strong prior year.
Higher results in North America driven by food service and fuel demand were offset by slightly lower results in Europe, South America, and Asia, but the gross profit rose from US$325 in 2022 to US$333 million.
In the milling segment, lower results in the quarter were primarily driven by our South American operations which were negatively impacted by the small Argentine wheat crop, with the gross profit reducing from US$126 million to US$40 million compared to the same period last year.
Segment results in the prior year benefited from effective risk management of our supply chains during a period of high market volatility
According to Heckman, the team at Bunge remained flexible, leveraging our global footprint and connectivity to optimize margins and utilization as market conditions evolved over the quarter.
“We look forward to our announced combination with Viterra, which will accelerate our strategy to bring us even closer to farmers with expanded direct origination while broadening our global processing and distribution network to serve our customers better,” Heckman commented.
He also remarked that the grains merchant would continue to execute its strategic priorities, focusing on driving further adoption of sustainable practices in global food, feed, and fuel production including low-carbon product streams, regenerative agriculture, and end-to-end traceability across major crops.