Paris, Sep. 12 - U.S. agribusiness giant Cargill Inc has teamed up with Europe's leading biodiesel maker to open a new oilseed crushing plant next week, a move that will enable it to penetrate the French biofuel market.
In a different strategy than in Germany where it opened its own biodiesel plant, Cargill France said it had preferred a partnership with Diester Industrie, by far the largest biofuel maker in France, to penetrate the French market.
"In France the market share of the operators already there convinced us to prefer a partnership," the head of Cargill's European grain and oilseed division, Herve de Praingy, told Reuters in an interview. "We would have been too small."
Diester Industrie, owned by French oilseeds growers' financial arm Sofiproteol, runs 10 biodiesel units in France.
Cargill's new crushing plant, called Cargill Atlantique, was built right next to Diester Industrie's biodiesel plant near the port of Montoir/Saint-Nazaire. It will send its rapeoil to Diester Industrie by pipeline.
MUTUAL INTEREST
Cargill Atlantique took a 25-percent stake in the Diester Atlantique biodiesel plant and vice versa. The joint project represents a 65 million euros investment for Cargill.
The plant will crush 600,000 tonnes of rapeseed to make 350,000 tonnes of rapemeal, mainly used in animal feed for its high protein content, and 250,000 tonnes of rapeoil a year.
Praingy stressed that the two companies found a mutual interest in the project as Cargill wanted to build a crushing plant in the region -- that produces 65 percent of France's animal feed -- and needed an outlet for its rapeoil and Diester Industrie needed additional supplies.
Cargill Atlantique, which will employ 33 people, is the company's third grain and oilseed crushing plant in France. The plants have a total capacity of 1.85 million tonnes of grains.
Cargill employs 2,200 people in France -- up from 1,000 three years ago -- with revenue of about 2.3 billion euros. The group, one of the 10 largest companies in the world, has global revenue of $120 billion.
The company said last month its earnings in the fiscal fourth quarter rose 68 percent to $1.05 billion and full-year profit rose 69 percent to $3.95 billion, mainly due the surge in agriculture commodities prices.
The company aims at doubling its size every five to seven years, Praingy said.