In a file photo, Workers load sacks of sugar onto ships at the port of Santos, about 50 miles southeast of Sao Paulo, Brazil. Photo: AP
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https://scmp.com/business/global-economy/article/2105020/chinese-commodities-trader-cofco-taking-part-brazil-auction Business
Chinese commodities trader COFCO taking part in Brazil auction for sugar mill
People visit the COFCO Corp booth. The Chinese commodities firm will take part in the bidding for a sugar mill in Brazil. Photo: Getty
Chinese commodities trader COFCO has asked to participate in an auction in Brazil where a sugar mill owned by India’s Shree Renuka Sugars Ltd will be sold as part of an in-court debt restructuring, according to court documents seen by Reuters on Tuesday.
COFCO already owns four sugar and ethanol plants in Brazil capable of processing a combined 15 million tonnes of cane per year. The company looked at other potential targets last year, but said prices were too high.
Renuka, which is under bankruptcy protection, will sell its Revati mill in the municipality of Brejo Alegre in Sao Paulo state. The plant, which is near COFCO’s Sao Paulo operations, has capacity to process 4 million tonnes of cane per year. The auction is scheduled for September 4.
If successful, it would be the third sale of sugar and ethanol plants in Brazil through judicial auctions in less than a year, as players with stronger capital structure snap up the assets of heavily indebted rivals.
A peasant woman cuts sugar cane with a machete in the Usina Bonfim farm plantation of the COSAN group. Photo: AFP
Glencore Plc bought the Guararapes mill in November from distressed sugar group Unialco. Raizen Energia SA, a 50-50 joint venture between Cosan SA Industria e Comercio and Royal Dutch Shell Plc, acquired two mills from Tonon Bioenergia SA in June.
According to the court documents, Brazilian sugar firm Companhia Mineira de Acucar e Alcool (CMAA), which owns two mills in Minas Gerais state, has also asked to take part in the auction. Last year CMAA acquired the Vale do Pontal mill from US-based Archer Daniels Midland.