March 21, 2014
Cargill to invest US$140 million to expand corn processing capacity in Brazil
Cargill''sBrazilian division plans to invest US$140 million over the next two years to expand corn processing capacity and increase starch and sweets output in Brazil, Reuters reported.
Cargill will spend the bulk of the investment on the expansion of an existing plant in Uberlandia, Minas Gerais state, to produce the corn derivative maltodextrin, citric acid, modified starches and animal feeds, said Laerte Moraes, head of Cargill''s Latin American starch and sweetener.
Despite the recent economic slowdown in Brazil, Moraes says that the largest economy in South America is a growing consumer market for value-added food products, especially infant food, ice cream and sports drinks.
Moraes cited lower fat, better-textured yogurt as an example of value-added dairy products, demand for which is growing in the country. "The industry needs products with different characteristics and this requires technology," he said.
In February, Cargill inaugurated a 500,000-tonne corn starch and sweetener plant in Castro, Parana state of south eastern Brazil, with a US$214 million investment to expand its cornprocessing capacity in South America by 30%.
Brazil uses most of its corn domestically and is expected to become the world''s second largest exporter behind the United States this season.
Brazil''s crop supply agency Conab expects Brazil to harvest 31.4 million tonnes of corn from its first crop season, and another 43.8 million tonnes from the second season.
"This year you have a large American crop, a large European crop and some slowdown in global demand," Moraes said. "It''s not a great climate for exports."