CHS Unveils Joint Grain Venture with InVivo
The 50/50 venture between CHS and InVivo Group, to be called ICGrain, will source grain from Hungarian farmers to be shipped internationally to food and feed companies. Hungary is Europe’s seventh biggest overall grain producing country, and its fourth biggest corn producing country, with a latest corn harvest of 9.1 million tons according to Coceral. It is also Europe’s third biggest oilseed producing country behind only Romania and Bulgaria, producing 1.6 million tons of Europe’s total 8.9 million ton sunflower oilseed crop.
Over the past year, Minneapolis-based CHS has expanded its global presence through a series of partnerships including a 50% stake in Australia’s Broadbent Grain, and joint ventures with E-Grain, Noble, and an investment with Lartirigoyen in an Argentine export terminal. The co-op also formed a fertilizer sources partnership with UK grain company, Gleadell which is owned equally by InVivo and Archer Daniels Midland (ADM).
The ICGrain venture will give CHS improved access to the key Danube region – a critical hub for European grain transportation, and will provide better barge access to CHS’s Black Sea port terminal at Constanta, Romania.
France-based InVivo is a network of 223 agricultural co-operatives with a farmer membership exceeding 300,000. It too has committed to a course of global expansion aimed at doubling its sales within 10 years. Last month the group secured a US$230 million capital increase for its animal nutrition and health unit, NSA, and in December 2014 announced a Black Sea grain sourcing agreement with Archer Daniels Midland (ADM).
"The creation of ICGrain is in line with the ambitious growth and international expansion strategy adopted by InVivo Group,” deputy managing director of InVivo, Jerome Duchalais tells Agrimoney.
For CHS, the partnership with InVivo offers increased value to both its farmer members and its customers as it strengthens its grain sourcing capabilities and presence in key global grain regions.