ADM likely to increase stake in Australian grain trader GrainCorp

US-based Archer Daniels Midland (ADM) is reportedly seeking to increase its holding in Australian grain trader GrainCorp.

The announcement was made by the company’s president and COO Juan Luciano at the FT Commodities Global Summit in Switzerland on Tuesday.

Luciano was quoted by The Financial Times as saying, "We think long-term, Australia’s strategically positioned to build our Australasian strategy.

"We’re going to hold to our 20% and we’re going to try to increase that, to get to the final goal."

GrainCorp operates 280 grain storage facilities with seven of the eight ports that engage in bulk shipping of grains from eastern Australia.

It is involved in the receival, testing, transport, handling and storage of grain and other bulk commodities, as well as the export of wheat, barley and oilseeds.

The acquisition of GrainCorp would allow ADM to strengthen its grain sourcing capabilities beyond its US base.

ADM had earlier made an A$3.4bn ($3.1bn) offer to tak eover GrainCorp; however, the Australian Government opposed the deal following concerns from stakeholders and the broader community that it would not be in the national interest.

Treasurer Joe Hockey had said that he was open to allowing ADM to own up to 24.9% of GrainCorp.

Luciano added, "It’s the last Australian asset in the east, and as I said we were slammed by a little bit of fear and nostalgia.

"We are committed to working with the government and the farmers to placate those fears and dissipate those fears."