USA – The American agribusiness company, Bunge Limited has reported US$365 million in net income for the quarter ended September 30 reflecting strong earnings in grains and soybean crush.

Net income for the first nine months of the year was US$332m, up from US$220m while in 2017, the company posted net income of US$92 million for the third quarter.

Total segment earnings before interest and taxes (EBIT) for the quarter increased from US$175m to US$535m for the third quarter.

Led by soy crush, agribusiness performed well to register US$50 per tonne in margins attributed to increasing demand for grains in the global market.

Soy crush margins improved, based on the demand for soybean meal, a drop in crush in Argentina from the drought, reduced US soybean prices as tariffs from China started and actions the company took to establish a soybean inventory in Brazil.

“Our team navigated really well through a complicated market environment and is making sure we monetize the physical position in soybeans we built during the second quarter,” said Soren Schroder, Bunge CEO.

“Strong soy crush margins moderated during the quarter in some regions, resulting in positive new market-to-market of approximately US$155m at the end of the third quarter related to crush capacity commitments beyond the third quarter.”

In Edible Oil Products, performance improved sequentially; however, due to the favourable soy crushing environment, margins in Brazilian packaged oil and North American refining remained under pressure, according to him.

Bunge completed its acquisition of a 70% ownership interest in IOI Loders Croklaan which Bunge said recorded soli results though earnings were affected by approximately US$10 million negative impact from the revaluation of raw material supply contracts.

While US-China tariffs were hurting trade, Bunge said demand for soybean meal is growing outside of China and likely will likely grow in China in the future, probably when the two reach a trade deal.

Results were supported by better origination in Brazil where commercialization of grains increased and in North America, origination results were better than last year.

Milling registered improved results and Bunge expects a good year ahead given potential for increased grain imports.

This segment was driven by higher results in Brazil as margins expanded with the smaller domestic wheat crop while results in the U.S. and Mexico were similar to last year’s.

Sugar trading and distribution incurred a US$5 million loss related to exiting the international business, which was completed during the quarter.

It was also impacted by early-season drought and excessive rain during the quarter, reducing production and increasing unit costs.

For the year 2019, the company expects to benefit from soybean and soft seed crush, along with demand and trade, efforts from Bunge Loders Croklaan as well as milling.

The company also announced that it is increasing the savings target for its global competitiveness program by US$25m, with the new goal of saving US$175m this year.