Germany’s BayWa Eyes Grain Trade Expansion with Romania Projects

Munich-based BayWa AG is maneuvering to become one of the top five grain trading companies in the world as it expands operations in eastern and southern Europe.

The company is targeting an increase in grain and feed product trade to 40 million tons by 2016 – approximately 33% above 2014 volumes, according to company chief executive officer, Klaus Lutz.

“To become one of the key traders and to increase the volume, we need to be present in either eastern Europe or especially in Romania,” Lutz said in an interview with Bloomberg.

In 2012 the company bought the Dutch grain trader, Cefetra, and has since bought another trading company in Romania and has opened offices in Madrid and Rome.

Following in the recent footsteps of ADM, BayWa is planning further expansion in Romania and is currently in negotiations to purchase terminals at the port of Constanta that will have the ability to handle panamax vessels. The firm also is planning expansion projects at Mukran in northern Germany to handle large shipments on the Baltic Sea.

The company also announced on March 19 that it is acquiring Bucharest-based trading company, Patberg International, and has indicated it will open offices in the cities of Moscow and Kiev.

Global grain trade is expected to reach a record in the marketing year that ends in June 2015, but then decline once again in the following season, according to the International Grains Council. And as Russia and Ukraine pull back on grain shipments amid ongoing conflict in the region in order to fight rising food costs, European Union exporters are shipping barley and wheat at their fastest pace in a decade.

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