King corn (syrup)
With corn prices reaching stratospheric levels, it's only natural that these should be consolidation among the world leaders in buying and processing corn. At $7 a bushel, corn costs twice as much as it did a year ago, and with much of Iowa under water, the prices might climb even more. So when food processor Bunge announced the purchase of US-based Corn Products International for $4.2 billion (in stock) the concentration the food processing oligonomy only got tighter.
While less well known than rivals ADM and Cargill, Bermuda/US-based Bunge is a close rival. It already is the dominant player in oilseeds world wide, and is one of the leaders in soy processing, and a player in corn and wheat..
Corn Products is a specialist in distilling high fructose corn syrup, the sweetener used in soft drinks and packaged foods. It is the #4 company in that field, after ADM, Cargill, and Tate & Lyle. It has global manufacturing and sales. Aside from HFCS, the company sells corn starch, corn oil, and corn gluten for various food and non-food manufacturing uses. Clients include Coca-Cola and Kellogg. The company was part of Best foods until 1999.
Bunge was already a player in corn, but the Corn Products addition will make it a closer rival to the other food processing giants. The company has 450 plants worldwide.
It is these companies, now loaded with cash, more than the farmers, who are in a position to benefit the most from rising food prices and increased demand for processed foods in China, India, and other developing countries. Bunge's shares have gone up by nearly 50% over the past year. The more powerful and rich these companies are, the better they are in a position to set prices and costs, and above all to influence global trade policies in their favor.
8:56:13 PM 
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