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Sojitz to invest in Brazil grain firm

Bloomberg

Trading house Sojitz Corp. will invest in a Brazilian grain harvester and collector to tap food demand in Asia.

Sao Paulo-based Cantagalo General Grains SA farms 150,000 hectares and collects 2 million tons of grain a year, Tokyo-based Sojitz said in a statement.

The investment will include Cantagalo’s exporting unit CGG Trading SA, Sojitz said, without disclosing the form or the amount.

With the world’s grain consumption more than doubling in the last four decades, Japan’s trading companies are seeking to secure supplies in the Americas and Eastern Europe to feed Asia’s growing population.

Marubeni Corp. paid $2.7 billion this year for Gavilon Group LLC, the third-largest U.S. grain merchandiser.

Tying up with Cantagalo, which plans to triple its grain handling volumes by 2020, should help Sojitz boost its own annual grain trade to 10 million tons in the same period, the company said. It didn’t specify its grain volume.

To make the Brazil project a success, Sojitz and its local partner will also help build the Itaqui port in northern Brazil, the company said. Most of Brazil’s grain is exported from the nation’s southern ports, which have become congested, Sojitz said.