Calgary-Viterra Inc. said July 8 that it expects average grain marketings in the 2009/10 crop year based on current crop conditions and a significant carryout of production from 2008/09. Its current estimates assume continued timely rains and a frost-free fall harvest period. Viterra anticipates average yields in most areas of Western Canada this year. The company noted that crop development was aided by precipitation that was received over most of the prairie region this week. However, an area of west central Saskatchewan and east central Alberta is expected to experience significantly reduced yields due to dry conditions. Viterra concurs with recent industry estimates of production of the six major grains in Western Canada in the 44-46 million mt range, slightly below the ten-year average of 48 million mt. However, on-farm carryout from a record crop in 2008 is expected to be 7 million mt, up from 3 million mt last year. As a result, it is the company’s current expectation that deliveries (6 major grains) into the western Canadian grain handling system for 2009/10 will be 30-31 million mt, consistent with the 10-year average. “It is important to keep in mind that Western Canada is an extremely large and diverse producing region. While an area experiencing drought conditions has received significant media attention, overall crop prospects are in the normal range,” said Mayo Schmidt, Viterra president and CEO. Viterra also confirmed that its acquisition of ABB Grain Ltd. (ABB) remains on track, following a revision by ABB to their earnings guidance for their fiscal 2009. “Our offer was not based on one year of earnings, but rather the long-term cycle of earnings beginning in 2010 and beyond,” Schmidt said. “The strategic rationale remains compelling. In addition, crop prospects in South Australia have been supported by good rainfall and growing conditions. As such, Viterra remains committed to its acquisition of ABB and strongly believes that the combination of ABB and Viterra will create a global leader in agri-business that will deliver significant benefits to the shareholders of both companies.” Last week ABB downgraded its net profit forecast for the year ending Sept. 30, 2009, to A$43-$53 million, down from projections given in May of A$53-$63 million. ABB cited lower demand in both the malt and ag input industries.
Transparency Across the Fertilizer Value-Chain