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Mitsubishi takes 80% stake in Olam Australian grain handling

July 31, 2014

Japanese conglomerate Mitsubishi Corp is investing US$64M to take an 80% stake in Olam International’s grain handling operations in Australia, signalling further expansion in grain storage and handling infrastructure, reported The Australian on 25 June.

Japanese conglomerate Mitsubishi Corp is investing US$64M to take an 80% stake in Olam International’s grain handling operations in Australia, signalling further expansion in grain storage and handling infrastructure, reported The Australian on 25 June. 

The Mitsubishi-Olam joint venture, to be renamed Agrex Australia, would look into investment in up-country grain storage and possible new port sites and become a much bigger business than the 1.5M tonnes/year of exports it currently handled in the country, Olam Australia head Bob Dall’Alba told the newspaper. The deal is expected to be finalised next year and is another step in Mitsubishi’s goal to double its global grain handling volumes to 20M tonnes by 2020.

The deal also includes 12.5% of the 32.5% Olam Grains Australia (OGA) holds in Newcastle Agri Terminal in eastern Australia, the first major grain port development in New South Wales in over 25 years. The terminal, which opened in February, is also owned by Switzerland’s Glencore Xstrata and CBH Group – the Western Australia grains cooperative. Australia’s grain sector has already attracted other heavyweights such as US-based ADM (see news item, p3), Cargill and CHS Inc; and Mitsubishi’s rival Sumitomo, which agreed in February to lift its stake in Australia’s Emerald Group to 100%.

Emerald is planning to expand its export facilities in Melbourne, Victoria. It is also part of the Quattro consortium, which is building a new 1.3M tonne capacity shipping terminal at Port Kembla, on the east coast of New South Wales. Local logistics firm Qube Holdings, Cargill and Singapore’s Noble Group are the other consortium partners.

The new terminal will compete directly with Australia’s GrainCorp operations at Port Kembla.


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