Cargill's festive spree brings ethanol deal

Cargill extended its festive spending spree by unveiling E60m ($83m) plans for a high-grade ethanol factory in Germany, adding to a Black Sea port purchase and a capacity increase at a Belgian cocoa plant announced over the past week.

The agribusiness giant, one of the "ABCD" group of crop trading majors with Archer Daniels Midland, Bunge and Louis Dreyfus, said that it would by autumn 2015 open a plant in Barby, Saxony Anhalt manufacturing wheat-based ethanol for drinks, cosmetics and pharmaceutical companies.

The plant will add to the wheat processing facilities Cargill already runs in Barby which make starches and sweeteners from the grain.

And it will expand the group's presence in high-grade ethanol, which it already makes in Manchester, United Kingdom, Sas van Gent and Bergen op Zoom in the Netherlands, and at Wroclaw in Poland.

"This investment will allow us to further build on our ethanol expertise in Europe, enabling us to better serve our customers throughout the region," said Frank van Lierde, executive vice-president at Cargill.

Spending spree

The announcement came less than 24 hours after Cargill revealed that it was spending $48m ($34m) doubling capacity at its largest chocolate plant, in Mouscron, Belgium over the next two years.

"The additional capacity will meet growing demand for chocolate in confectionery, bakery, dairy and artisanal applications from European customers," the group said.

On Friday, Cargill announced it had, for an unspecified amount, bought a stake of 25% plus one share in the Kombinat Stroykomplekt, or KSK, terminal at Novorossiysk, Russia's main Black Sea port.

Separately, rival Archer Daniels Midland, which last month lost its battle to buy Australia's GrainCorp, on Monday revealed a $1.4bn capital spending programme for next year, of which "the majority" will be spent outside the US.

Ethanol major

Other recent Cargill investment projects include a 35m ($57m) upgrade of its poultry processing plant, formerly Sun Valley, in Hereford, UK to "create a state-of-the-art facility".

Cargill became a heavyweight in European ethanol through a 2011 deal in which it bought its Manchester and Sas van Gent plants, which produced between them some 1m hectolitres of alcohol a year.

Other uses for the ethanol produced include for flavourings, mouthwash and printing ink.

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