Commodity giant Glencore confirmed on 6 April that it had agreed to sell a 40% stake in its agricultural business to Canada Pension Plan Investment Board (CPPIB).

The sale – which had been expected since last year – would raise US$2.5bn to be used to reduce Glencore's debt, BBC News said.

The Anglo-Swiss commodity trading and mining giant has been hit by falling commodity prices and has been undertaking a restructuring programme to reduce its $30bn of debt (see OFI News, November/December 2015).

Glencore chief executive Ivan Glasenberg said: "CPPIB has a proven track record in the sector and shares our vision for the future growth of the business through value-creating organic and inorganic growth opportunities.

"We welcome them aboard and look forward to continuing our good relationship as we work together."

Glencore trades in commodities including grains, oilseeds, rice, sugar and cotton.

Its agricultural products division reported a 39% drop in profits for 2015, Agrimoney reported on 1 March.

The division reported earnings before interest, tax, depreciation and amortisation (EBITA) of US$734M for 2015, a 39% drop year-on-year, on revenues of US$23.15bn, down 10.4%.

A "challenging" environment was reported, attributed to "lower prices, lack of volatility and limited arbitrage opportunities".

A weaker grains harvest undermined results in Canada, a particularly important market for Glencore, which bought grain handler Viterra four years ago.

"Furthermore, 2015 was adversely impacted by the immediate imposition of a punitive wheat export tax in Russia," Glencore said.

In processing, volumes were boosted by the purchases of oilseed crushing plants in Canada and Germany, and 50% of a Brazilian grain handling and port facility.

Glencore said processing profits were hurt by the dent to the biodiesel market from "regulatory changes and lower competing diesel prices", leading to biofuel output dropping by 27% to 556,000 tonnes.

Margins on what was produced were also squeezed by the support to rapeseed prices from a weaker EU harvest last year and "lack of farmer selling".

According to BBC News, Glencore accumulated much of its debts through its ambitious takeover of Xstrata in 2013. That deal added dozens of mines in numerous countries to the commodity trader's business, leaving it as one of the world's biggest miners and traders of the products of those mines.