Bunge to build fertilizer plant at Argentina port
Wed Sep 21, 2005 06:46 PM ET
RAMALLO, Argentina, Sept 21 (Reuters) - The local unit of Bunge Ltd., the world's top oilseed processor, will build its first fertilizer plant in Argentina at a new port complex where it plans to invest $300 million in coming years.
Bunge Argentina officials celebrated on Wednesday the official inauguration of its new riverside terminal in Ramallo, Buenos Aires province, about 155 miles (250 km) north of Argentina's capital.
The company plans to build a fertilizer facility and soy-crushing plant on the 1,000 acre (400 hectare) site, along with additional loading docks, silos and a rail terminal.
"We are thinking of speeding up the phase of producing fertilizers in Argentina, which would be phosphate-based," Enrique Humanes, industrial director of Bunge Argentina, told Reuters. "Our aim is to have the plant functioning by the end of 2007."
Bunge is the largest producer of phosphate-based fertilizers in South America, with operations mainly in Brazil.
The company is banking on Argentina's grain and oilseed output rising to 100 million tonnes by 2010, from a record 84 million tonnes in the 2004/05 growing season.
In soy alone, Bunge sees output surging by 10 percent next season after hitting a record high of 39 million to 40 million tonnes in 2004/05, Humanes said.
Bunge, which is Argentina's No.3 exporter, has seen its grain and oilseed exports rise to between 11 million and 12 million tonnes from some 800,000 tonnes in 1995.
"Today we have a total crushing capacity of between 22,000 and 23,000 tonnes a day. When this project is finished, with its processing plant, we should be closer to 30,000 tonnes," said Bunge Argentina President Raul Padilla.
Bunge mainly exports soymeal, soyoil and soybeans from Argentina, the world's No.3 soybean producer.
The company plans to define its strategy for building a crushing plant in Ramallo by year's end, Humanes said.
Bunge expects to crush soy grown in Argentina, along with beans from Bolivia and Paraguay. The company has invested $50 million in the new port complex so far, with another $50 million earmarked for the next year and a half.
The time frame for the entire project will depend on how quickly Argentina's production rises and on market conditions, Humanes said. The Ramallo complex is forecast to employ 300 people and provide 3,000 indirect jobs.
Bunge said it aims to provide an alternative to the concentration of crushing plants and grain-export ports in the Rosario, Santa Fe area, which it says is the world's biggest crushing hub.
Buenos Aires province is Argentina's No.3 soy producer, and while southern growing areas are served by ports in Bahia Blanca and Necochea, production in central and northern Buenos Aires is channeled to Rosario.
Vessels can reach Ramallo a day earlier than northern Rosario ports, which means a great savings on freight costs, Humanes said.
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