Potential Industry Deals in Agriculture on Hold as Trade War Continues

Bloomberg writers Mario Parker, Javier Blas, and Isis Almeida reported today that, “The agriculture deals buzz has gone quiet.

For a while, it looked as if the big trading houses that dominate agriculture were about to see their biggest shakeup in 20 years. Bunge Ltd. was targeted by rivals Glencore Plc and Archer-Daniels-Midland Co., while Louis Dreyfus Co. also explored potential deals. Meanwhile, mid-sized traders prepared to buy up any spoils that might roll out from any big merger.

Fast forward to today and the chatter of 2017 and 2018, involving deals worth as much as $15 billion each, has all but faded. Uncertainty surrounding the U.S.-China trade war and the U.S. presidential election have put big deals on hold, according to a dozen interviews with industry executives, bankers and consultants from Geneva to New York and Chicago.”

The Bloomberg article stated that, “The trade war, in particular, ‘makes it hard for anyone to make a decision,’ said Chris Shaw, an analyst at boutique research and broker firm Monness Crespi Hardt & Co. in New York.”

Today’s article added that, “Speaking in private, commodity executives say it’s difficult to value a business right now because it remains unclear how the world of farming will look until Washington and Beijing reach a trade deal.”

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