Bunge Ltd., St. Louis, has bought a 33 percent stake in Brazil’s Sinagro Produtos Agropecuarios SA, Primavera do Leste, Mato Grosso, in order to strengthen its grain orientation strategy in the country. Sinagro is a major reseller of grains and agricultural inputs, with a significant presence in Brazil’s “Cerrado” savanna region. The deal was announced by the sellers – UPL Ltd., Mumbai, India, and other shareholders – on Jan. 20. UPL invested in Sinagro in 2015.
Sinagro, which has been in business for over 20 years, has a network of more than 30 stores and warehouses, which includes 28 distribution units and four grain origination and commercialization units in seven Brazilian states (Mato Grosso, Mato Grosso do Sul, Goiás, Bahia, Tocantins, Pará, and Minas Gerais). It operates in the fertilizer, crop protection, seed, and grain origination segments, and participates in Bioplanta, a company that produces foliar fertilizers.
“UPL is pleased to have this strategic partnership with Bunge and welcomes Bunge’s contribution to Sinagro on several fronts,” said Rogerio Castro, CEO of UPL do Brasil. “In addition to Bunge’s origination, logistics, and risk management expertise, which is undeniable, Bunge is a company with an outstanding global reputation and a strong presence in Brazilian agribusiness.
“Together with UPL, this new partnership will strengthen Sinagro’s bases across the board,” he added. “This agreement will also accelerate the company’s growth and expansion in Brazil.”
“With this deal, we further strengthen our partnership with Bunge in a relationship that will generate mutual benefits,” said Renato Guimaraes, Sinagro President. “On our side, Bunge’s expertise in risk management and its logistics capacity maximizes our opportunities in the grain market, while we are aligned on sustainable, traceable, and verifiable production in the Brazilian Cerrado.”
“This transaction will contribute to Bunge´s grain origination capabilities and to its access to producers in the region,” said Rossano de Angelis Junior, Bunge Agribusiness Vice President. “In addition, Sinagro and Bunge are closely aligned on their global vision of being the preferred partner in sustainable solutions for oilseeds, commodities, and related ingredients, both for farmers and end customers.”
Sinagro was one of the first signatory companies to join Bunge’s “Sustainable Partnership,” an initiative launched in 2021 whereby Bunge helps grain resellers set up socio-environmental assessment systems for suppliers – including satellite monitoring – at the farm level. Program participants can adopt independent geospatial imaging services or use Bunge’s structure at no cost.
Terms of the deal were not disclosed. The deal still needs approval from Brazil’s antitrust regulator, the Administrative Council for Economic Defense (CADE).
Late last year, Bunge signed a Memorandum of Understanding to buy a minority stake in Brazilian agricultural retailer Pantanal Agricola (GM Dec. 3, 2021). That transaction allows Bunge to intensify barter trading in the Center-West region, where Pantanal operates. Bunge also plans to invest in Pantanal’s grain storage capacity and boost its potential growth.
Pantanal Agricola, in business since 2001, operates in three states – Mato Grosso, Mato Grosso do Sul, and Goias – and 32 cities, selling fertilizer, seed, and crop protection products.