Cargill wins judicial action to acquire soy processing facility in China

Global food company Cargill has reportedly acquired a Chinese soy processing facility via a judicial auction by placing a final bid of CNY421m ($62.1m).

Reuters reported that the acquired facility is located in Rizhao, Shandong Province, and was earlier owned by Shandong Xinliang Oils & Fats Co.

The acquisition is said to have been made through Alibaba’s Taobao website, which is said to be China’s top e-commerce platform.

Through this deal, the US-based agricultural commodities trader and processor has increased its soy crushing capacity in China, which is reported to be the top soy consuming nation in the world.

Completion of the deal is subject to the approval by the local court, an online confirmation letter.

The latest acquisition comes less than a year after Cargill acquired the 34% stake it didn’t own in Hebei Jiahao Grain and Oilseeds, another Chinese soybean processing plant.

With its crushing capacity in China, Cargill is said to be the largest foreign soy processors in the country, which is dwarfed by Chinese-owned processors such as COFCO and Jiusan.

According to the US Department of Agriculture (USDA), China is one of the largest purchasers of soybean in the global market and expected to procure 99 million tonnes of the oilseed in the 2020/2021 season.

In another development, Cargill announced its support to the farmer-led efforts for adopting practices and systems that are integral to regenerative agriculture practices across ten million acres of farmland in North America over the next decade.

The initiative will primarily focus on row crop rotations, which include corn, wheat, canola and soybeans and other staple crops.

Cargill anticipates that these regenerative agriculture practices would offer long-term profitability and resiliency of farmers.