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Glencore looks to buy big Canadian grain trader

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Glencore, the world's largest publicly traded commodities supplier, said today that it has an interest in buying Canada's biggest grain handler Vittera.

Buying Viterra would give Glencore the largest share of the Canadian grain market just as the Canadian Wheat Board's monopoly over wheat ( WEAT , quote ) and barley grown in the west of the country comes to an end. Viterra's share of Canadian grain handling may rise to almost 50% in the next two years from 45%, according to a statement by Chief Executive Officer Mayo Schmidt. The Canadian government passed a law in December that will end the monopoly and give farmers the choice to sell to other buyers as of August 1. Viterra said in January it expects to increase grain volumes and earnings after the board's control of supplies ends. Glencore is also among companies interested in closely held grain handler Gavilon Group. Glencore's 2011 adjusted earnings before interest and tax from agricultural trading swung to an $8 million loss from a $659 million profit a year earlier. The company had a "one- off" cotton trading loss, CEO Ivan Glasenberg has said. Adjusted profit from trading metals and minerals was $1.24 billion last year, while energy trading's earnings were $697 million. Under Canada's foreign-takeover legislation, known as the Investment Canada Act, foreign acquisitions of companies with assets worth more than C$312 million are reviewed by the federal government to determine whether the transaction is beneficial to the nation. Glencore is not traded in the United States but is watched throughout the global commodity markets as a bellwether of trends. It has been aggressively acquiring assets, recently making a bid for miner Xstrata ( XSRAY , quote ) and looking into iron ore as well. by Simon Watkins for Emerging Money

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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