ADM and Cargill to establish new joint venture in Egypt

US-based food companies Archer Daniels Midland Company (ADM) and Cargill have agreed to establish a new joint venture (JV) in Egypt to produce soybean meal and oil in order to meet the growing demand for the product in the region.

The JV will be operating the National Vegetable Oil Company soy crush facility located in Borg Al-Arab, as well as carry out other commercial activities, including a separate Switzerland-based merchandising operation that will supply soybeans to the crushing plant.

Cargill owns a majority stake in the National Vegetable Oil Company that processes soybean at its facility.

Cargill is currently planning to expand the plant’s daily crush capacity from 3,000t to 6,000t, in order to eliminate the need for importing soybean meals into Egypt.

Cargill EMEA grain and oilseed business head Roger Janson said: “The joint venture brings together Cargill and ADM’s operational and commercial expertise to meet growing local demand for higher-quality feed ingredients.

“This deal is part of our strategy to grow Cargill’s business across Egypt and the North Africa region and helps us better serve customers in the market with safe, affordable and nutritious food.”

Both ADM and Cargill will have equal ownership in the JV, which will operate as a separate business entity.

The JV assets do not include Cargill’s grain business and port terminal in Dekheila, or the ADM-Medsofts joint venture at the Port of Alexandria.

Upon receiving approvals from the regulatory authorities, ADM and Cargill intend to formally launch the joint venture by mid-2018.

ADM EMEA Oilseeds crush president John Grossmann said: “ADM is adding to its geographic footprint in regions of expanding growth, and we’re particularly pleased to continue to enhance our capabilities in Egypt.

“Egypt is an important market where demand for high-quality soybean meal and oil is outpacing the rest of the world.

“By bringing together expertise and resources from two great companies, and by utilising an existing facility and infrastructure, this joint venture would be perfectly positioned to efficiently meet growing Egyptian demand.”