Bunge North America announced last week that it will sell 35 U.S. grain origination elevators along the Mississippi River to Zen-Noh Grain Corp. (ZGC) The completion of the sale is subject to customary closing conditions, including regulatory approval.
Zen-Noh is a subsidiary of the National Federation of Agricultural Cooperative Associations of Japan (Zen-Noh).
“This transaction will allow Bunge to operate more efficiently and reinvest in higher returning areas of the company while reducing costs and strengthening our balance sheet,” said Greg Heckman, Bunge’s CEO said in a statement. “Bunge will continue to be an industry leader in the U.S. grain marketplace through global grain trading and distribution with our export terminal in Destrehan, Louisiana, which we are expanding, and EGT, our joint venture in the Pacific Northwest. We will also continue our strong presence in the soybean processing business and milling operations.”
Through certain supply agreements, St. Louis-based Bunge said it will be able to access a larger and stronger origination and distribution network through Zen-Noh to better serve U.S. farmers and global export customers.
In addition to the export terminal in Destrehan and the EGT joint venture, Bunge will retain ownership in Bunge-SCF Grain, Bunge’s joint venture with SCF, and the Bunge elevators in Indiana that directly support Bunge’s soybean processing plant in Morristown.
Bunge sources, processes and supplies oilseed and grain products and ingredients. The company has more than 350 port terminals, oilseed processing plants, grain facilities, and food and ingredient production and packaging facilities around the world.
ZGC’s affiliate, CGB Enterprises Inc., Covington, La., will operate the grain elevators through its wholly owned subsidiary, Consolidated Grain and Barge Co. CGB currently operates more than 100 grain origination facilities in the U.S. ZGC recently expanded its Convent, La., export elevator’s annual capacity. ZGC said the acquisition contributes to ZGC’s ability to adequately source a stable supply of grains, oilseeds, and feed ingredients for Japan and other destinations by strengthening its origination across a broader footprint in the U.S.