Archer Daniels Midland Company announced that it has reached an agreement to sell to Glencore plc a 50% stake in its export terminal in Barcarena, in the northern Brazilian state of Pará.
The ADM-Glencore joint venture that will own and operate the facility following the transaction also plans to quadruple the terminal's capacity from 1.5 million metric tons to 6 million metric tons.
"ADM is continuing to take actions to improve our returns on invested capital," said ADM CEO Juan Luciano. "One of the ways we're doing this is by taking an asset-light approach where it makes sense. This agreement will both quadruple the capacity and increase the utilisation of this strategically located port facility, enhancing our ability to serve the expanding Brazilian ag sector. And by sharing the investment with a partner, we are able to do all of this in a cost- and capital-efficient way."
Port terminal will handle larger vessels
In addition to its increased capacity, the upgraded terminal will be able to handle larger Panamax vessels, allowing the joint venture partners to connect global markets more efficiently.
"The Barcarena terminal will continue to be a vital component of our Brazilian logistics network," said Valmor Schaffer, president, ADM South America. "Agricultural production is expanding rapidly in northern and western Brazil, and the Barcarena terminal is very well positioned to capitalise on that growth. By quadrupling that terminal's capacity, we are also expanding our ability to serve growers here in Brazil, and meet customer needs here as well as in Europe, Asia and other key global markets."
The transaction is expected to close during the first half of this year.
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