CHS, North America's biggest farm co-operative, extended the list of tie-ups through which it is expanding abroad by unveiling a joint venture in Hungary with InVivo, one of Europe's top ag traders.
CHS said it agreed with InVivo to form a 50:50 joint venture, named ICGrain, which will source grain from Hungarian growers "for export to global food and feed companies".
The tie-up represents a series through which Minneapolis-based CHS has extended its reach, with the last year bringing the purchase of a 50% stake in Australia's Broadbent Grain, and joint investments with the likes of Noble, E-Grain and Lartirigoyen in an Argentine export terminal.
In Europe, CHS in June last year unveiled a fertilizer sourcing agreement with UK grain merchant Gleadell, which is equally owned by InVivo and US-based ag giant Archer Daniels Midland.
CHS said that assets it would contribute to ICGrain included an inland silo at Oroshaza in south eastern Hungary, while Invivo will fold in its Baja terminal further west, on the Danube river.
The venture will extend CHS's reach in grain origination, improve access to the Danube, a hugely-important artery for transporting central European grains, and indeed "improves barge delivery" to the co-operative's Black Sea port terminal at Constanta, in Romania, CHS said.
"Our new partnership with Invivo adds tremendous value to our member owners and customers," said Roger Baker, the Swiss-based manager of CHS's European operations.
For Invivo, Jerome Duchalais, deputy managing director, said that previous dealings with CHS had demonstrated that "we share many of the same business objectives, in addition to the fact that CHS and InVivo are both leading co-operative groups within their respective countries".
French-based Invivo is a union of 223 agricultural co-operatives, with a combined membership of more than 300,000 farmers.
"The creation of ICGrain is in line with the ambitious growth and international expansion strategy adopted by InVivo Group."
InVivo, which reported revenues of E5.7m for 20134-14, is amidst a shake-up aimed at doubling its sales over the next decade.
It a month ago sealed a E215m ($230m) capital increase for its animal nutrition and health unit, NSA.
InVivo has, in grains, also begun expanding worldwide through tie-ups, in December announcing a Black Sea grain sourcing deal with Archer Daniels Midland.
Hungary was last year the European Union's seventh largest grains producer, according to Coceral data, with its central continental climate particularly suited to corn, of which it was the bloc's fourth biggest grower, with a 9.1m-tonne harvest.
In oilseeds, it grows mainly sunflowers, achieving a 1.6m-tonne harvest last year, behind only Romania and Bulgaria within the EU, which produced a total of 8.9m tonnes of the crop.
As a landlocked country, it has been a relatively minor exporter to distant markets, with its shipments mostly aimed at other EU countries.