Cargill, Louis Dreyfus rivalry heats up in sugar -trade | Reuters
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NEW YORK May 16 (Reuters) - Commodity trading giants Cargill and Louis Dreyfus are becoming locked in fiercer rivalry in a range of agricultural commodities, and the latest arena is in the sugar market, trading sources said Wednesday.
Cargill, the Minnesota-based trading giant, is considered by many in the trade as the world's biggest sugar trader. Dreyfus is regarded by many as the second-biggest player in the sugar market.
"Dreyfus has been coming on strong in sugar," a long-time sugar dealer familiar with both companies told Reuters. "Cargill has been up-and-down because of the transition they went through."
Cargill's chief sugar trader, Jonathan Drake, left the company last December. He was regarded by traders as the architect of its aggressive stance in sugar deliveries.. Cargill said there has been no change in trading direction as a result of Drake's departure.
Dreyfus has raised its profile by being the sole receiver of 682,783 tonnes of sugar when the May raw sugar contract expired . The delivery of sugar has been dominated by Cargill for more than a decade, but the U.S. trading house has been absent from the delivery process recently.
Dreyfus also announced this week a tender offer for all outstanding shares of Imperial Sugar Co, one of the biggest sugar processors in the United States and allowing the firm to expand its presence in one of the world's biggest sweetener markets.
For its part, Cargill said last year it is looking to acquire sugar mills in top producer Brazil and plans to expand cocoa operations in Asia.
"Dreyfus is a formidable competitor," a former official of Cargill said separately on the sidelines of the annual meeting of the International Sugar Organization/Datagro.
"I do not know if Cargill considers them their top rival, but they now compete in several commodities," the former official added.
Cargill's sugar business is based in Geneva, Switzerland, and employs a total of 200 people in 16 countries.
Another market where both have become direct rivals is the cotton market, where prices trebled from August 2010 to hit its highest level since the U.S. Civil War in March 2011 at $2.27 a lb.
Dreyfus is the biggest cotton trader in the world through its wholly owned unit, Allenberg Cotton Co. Its chief rival is Cargill Cotton.
