Cargill and Brazil's Copersucar to join forces to become world's biggest sugar trader

US-based agri-food giant Cargill and Brazil's Copersucar, the world's largest sugar and ethanol company, yesterday said that they would form a 50-50 joint venture to create the world's biggest sugar trading company.

Copersucar and Cargill will combine their global sugar trading activities into a new joint venture to trade in raw and white sugar.

Cargill will put in its global customer network and transportation network, while São Paulo-based Copersucar will bring into the JV its 47 mills located across the world, which produce 10 per cent of the world's sugar exports.

The new company, whose name will soon be announced, will be an independent JV of its two parent companies, and will be based in Geneva, Switzerland, with offices in Hong Kong, Sao Paulo, Miami, Delhi, Moscow, Jakarta, Shanghai, Bangkok and Dubai.

Ivo Sarjanovic, who currently leads Cargill's sugar business, will be appointed CEO of the new company, while Hoed Jensen, current sugar & ethanol sales executive director of Copersucar will become the joint venture's chief operating officer, and Luis Roberto Pogetti, chairman of Copersucar, will become the first rotating chairman.

Both companies' ethanol businesses and fixed assets, such as terminals and mills, are excluded from this transaction.

Minnesota-based Cargill trades raw sugar in bulk, white sugar in bags or containers from offices in Geneva, Hong Kong, Minneapolis, Minnesota and Amsterdam.

It buys sugar from the world's leading sugar producing countries, including Brazil, where it co-owns and operates two major sugar export terminals.

It ships and distributes sugar to customers, industrials, distributors and end-users through offices in Egypt, India, China, Russia, Ukraine and other consuming countries worldwide.

Copersucar, formed in 1959 by Brazilian sugar and ethanol producers, is the world's largest producer and exporter of sugar and ethanol.

The company accounts for 13 per cent of all sugar sold in the South Central region and plans to have a 30 per cent share of the domestic market.

The deal will put Cargill and Copersucar ahead of their trading rivals, Sucres et Denrees, Louis Dreyfus and ED&F Man.

Luis Roberto Pogetti, chairman of Copersucar said, ''Through the new company, Copersucar reinforces its strategy of achieving a global footprint in the sugar market. Copersucar also enhances its unique business model, based on large-scale supply, logistic capacity and the integration of all links of the chain, from the producers to the customers.''

Olivier Kerr, Cargill corporate vice president, said, ''We believe that the strong analytical capabilities of our trading teams combined with the global footprint of this new joint venture, will offer our customers a distinct understanding of the global market.''