Grain trade giants boast one billion-euro business

Agriculture is considered the black hole of the economy, but to three foreign companies it means almost one billion-euro business in a year with a good crop and high grain prices.

The local branches of international giants Alfred C Toepfer, Cargill and Glencore have less than 300 employees together but posted one billion-euro turnover in Romania from grain trade last year. Alfred C Toepfer’s worldwide business amounts to 8 billion euros, Cargill’s to 3.3 billion euros, while Glencore’s stands at 120 billion euros.

The three companies are very discreet, however, and none of them wishes to talk about its business in Romania.

“Grain prices were very high in Romaina last year, 50% higher than now. International traders buy from producers and sell right away after adding a mark-up. The producers are “harassed” into selling the crop at low prices when harvesting it because they have no choice, they have no place to store it and the fact that sales in Romania are made as circumstances dictate gives traders an edge. We made them big with our weakness,” explains Culita Tarata, owner of TCE 3 Brazi, which grows grain on Insula Mare a Brailei.

Alfred C. Toepfer, whose business stood at 332 million euros in 2008, and Cargill, which posted more than 310 million-euro turnover doubled their revenues compared with the previous year.

Glencore Protein, with its 12 employees, posted 2.8 million-euro profit in 2008, which means each employee contributed 233,000 euros.

As for Alfred C Toepfer, each employee generated about 65,000 euros in profit.

The business of grain traders was higher than the results posted by the Romanian producers last year, as the former took advantage of the high prices and of the exchange rate trend, say the representatives for Comcereal Constanta, which operates in the same field but does not do business with the big traders, which prefer to deal with producers.

“We sell grain to them, which they export. They buy thousands of tonnes of wheat, sunflower, maize and barley every year,” explains the management of AgroInternational, a supplier of pesticides which works with Alfred C Toepfer, to which it sells the grain it gets from farmers in exchange for pesticides.

Local producers, Ioan Niculae’s Interagro, Cerealcom Dolj, run by Mihai Anghel, TCE 3 Brazi managed by businessman Culita Tarata, Comcereal Vaslui run by Adrian Porumboiu and Agrofarm Holding of Stefan Poienaru, posted cumulated turnover worth 800 million euros last year, and almost 35 million-euro profit. The total number of their farming operations employees stood at about 3,000.