Financial highlights:
- Total segment EBIT reached $1,078 million
- Agribusiness results were strong across the business
- Fertilizer benefited from the strong global agricultural environment
- The Company is increasing its full year 2008 earnings guidance by $2.25 per share
Alberto Weisser, Bunge’s Chairman and Chief Executive Officer stated, “The second quarter was characterized by good demand and strong margins. Bunge’s outstanding performance is a reflection of our skilled team and the value of our global and integrated network of operations.
“The quarter saw the announcement of our agreement to combine with Corn Products. The transaction, which we expect to close in the fourth quarter, will expand our operations into the highly complementary corn wet milling value chain. It will provide new opportunities for growth and a more diverse revenue stream by broadening Bunge’s product portfolio and by providing access to new geographic markets.
“Over the past several years, crop production has not kept pace with overall demand, which is driven primarily by the steady trends of global population growth and rising living standards in developing economies. Current agricultural commodity prices reflect this fact, as well as the higher cost of energy. The world needs a greater supply of grains and oilseeds, and in the near term crop prices should remain at levels that provide an incentive to farmers to produce larger harvests. This should lead to strong demand for fertilizer in regions with the greatest potential for agricultural expansion, such as Brazil.
At the same time, a high price, volatile environment will require disciplined use of working capital and effective risk management.
“Meeting the long-term challenge of supplying a growing world with ample supplies of affordable food will require not only greater crop production, but efficient distribution and processing. As the world consumes greater volumes of agricultural commodities and food products, the value of these services should increase. Providing them is Bunge’s role, and we will continue to invest to meet that responsibility effectively and profitably.