ADM agrees to buy Morocco-based corn wet mill

US-based agribusiness group Archer Daniels Midland (ADM) has agreed to acquire Tate & Lyle’s corn wet mill in Morocco.

The plant, whose production capacity has not been disclosed by ADM, manufactures glucose and native starch. After expanding its business in Eastern Europe last year, ADM now intends to strengthen itself in the sweetener and starch businesses.

The plant in Morocco’s Casablanca city will be ADM’s first corn processing unit in Africa.

According to the company, the regional market for starches and sweeteners is likely to see a 8% growth over the next few years.

ADM Corn Processing business unit president Chris Cuddy said: "The Morocco plant, which serves both global and regional customers in the food, feed, paper and corrugated board industries, is a great addition to our global sweeteners and starches footprint.

"The facility is the leading sweetener and starch supplier in a country that should see substantial demand growth in the coming years.

"It is well-positioned to serve Moroccan customers, as well as Mediterranean export markets.

"This also represents an opportunity to help introduce a wider range of ADM food and feed ingredients to the Moroccan market."

The acquisition following regulatory approvals is expected to close in the first half of this year.

ADM has been focusing on high-margin products such as corn syrup. In 2015, it acquired some assets from its joint venture with Tate & Lyle and gained complete ownership of corn wet mills in Bulgaria and Turkey, as well as a 50% stake in a mill in Hungary.

These acquisitions have taken its daily global corn processing capacity to three million bushels in 2015.

ADM recently announced it is exploring a a sale, partnership or other options for selected dry mills in the US due to poor margins.These dry mills mainly produce ethanol and animal feed.