During his visit to Brazil, Vice-Premier of the State Council Wang Yang takes a special trip to Santos Port in the afternoon of June 27 to inspect COFCO Group’s investment projects and hear a report delivered by COFCO Group chairman Ning Gaoning on COFCO Group’s “going global” drive and business model. Wang fully acknowledges COFCO’s “going global” drive and hopes that COFCO shall do a good job in consolidating upon acquisition and establishing its overseas supply chain. He also expects to lend more support to COFCO for its future growth.
At a forum on Chinese-owned enterprises with operations in Brazil held in Sao Paulo, June 27, Wang is debriefed by Ning Gaoning on COFCO Group’s development in Brazil. In his concluding remark, Wang comments that the investment cooperation between China and Brazil has been on the “fast track”. Since the economies of China and Brazil are highly complementary, the two countries enjoy broad prospect in their cooperation on production capacity, infrastructure construction, agriculture and energy. The related government departments should actively support the development of Chinese enterprises in Brazil, expedite the implementation of policies to assist enterprises in obtaining financing, and try to improve services for enterprises. On the other hand, the enterprises should have long-term strategies to open up new prospects, keep forging ahead to build awareness of creating premium products, and dutifully perform their social responsibilities so as to achieve win-win results for both China and Brazil.
After the forum, Wang and his delegation drive to Santos Port, the largest port in South America, to inspect T12A and Cerealsul wharves invested by COFCO. The local employees of COFCO welcome Wang and his delegation with COFCO’s unique “rainbow claps” and greetings in Chinese “Hello, Vice-Premier Wang”. Wang cheerfully replies in English: “Thank you very much.”
At Santos Port, Wang tours an exhibition of COFCO’s model of developing a fully integrated value chain, its global presence and its investment projects in Brazil while being briefed by Ning Gaoning on COFCO’s business model of “buying globally and selling globally” and its progress in going global. According to Ning Gaoning, everything from upstream planting all the way down to processing in the core value chain of global grain and oils industry ultimately hinges on large-scale wharves, which serve as logistic hubs to form a sound business model. As one of the most important distribution centers in the global grain trade, Brazil’s Santos Port witnesses considerable flux of agricultural products between eastern and western hemispheres. COFCO’s T12A and Cerealsul wharves serve as a major link in this global agricultural product value chain.
Wang expresses his great support for COFCO Group’s “going global” drive, its utilization of two markets and two kinds of resources, as well as its establishment of a global grain network. He travels all the way to Santos Port to take a look at the actual condition of COFCO’s overseas development and check whether COFCO can enjoy a better growth prospect in the future. He fully acknowledges the latest development of COFCO, noting that “COFCO’s presence in the international market and in Brazil has taken quite a shape. Although the wharves and warehouses at Santos Port only account for a small portion of COFCO’s overseas assets, it is good enough for COFCO to have a niche at Santos, where international grain traders gather.”
Wang not only highlights the difficulty of going global to acquire overseas enterprises but also points out that it is even more difficult to effectively manage and integrate the acquired assets so as to form synergy. He hopes that COFCO will play a greater role in ensuring China’s food security by building its overseas supply chain as well as its competitiveness through sound management based on the present foundation. He also assures COFCO of his continuous support for its future development.
Wang and his delegation take a boat tour to get a full view of Santos Port and to make an on-the-spot investigation of T12A and Cerealsul wharves. While aboard the boat, Wang has a cordial talk with COFCO Group president Yu Xubo, COFCO International senior vice president Yang Hong, Brazil- and Argentina-based management teams of Nidera and Noble Agri, in which COFCO has controlling stakes, and some employees. Matt Jansen, who has become the newly-appointed CEO of COFCO Noble Agri after being selected from a global pool of candidates, is introduced by Ning Gaoning to Wang, who on behalf of the Chinese government welcomes him to join COFCO’s management team. Matt Jansen thanks Vice Premier Wang’s welcome by saying that “It is also a great honor and opportunity for me”. Wang also hopes that managers and employees of Nidera and Noble Agri can enjoy brighter prospect in their future career backed by China’s largest agri-food enterprise.
In the global supply chain that has begun to take shape upon COFCO Group’s acquisition of Nidera and Noble Agri, Brazil -- the future granary of the world -- is one of the countries where COFCO has made most overseas investments. At present, COFCO boasts excellent control of grain source and transit logistic capability in Brazil. With a total of almost $5 billion invested in Brazil, it mainly engages in soybean and corn business and owns two soybean oil pressing mills, four sugar mills, one transit station, two wharves and twelve silos. In Brazil, COFCO’s operating volume in grains and oilseeds exceeds 8 million tons with its total grain source standing at 7.4 million tons, warehousing capacity at 1.81 million tons, and port transit capacity at 5.73 million tons. Its soybean and corn seeds business takes the lead in South America, accounting for 14% of Brazil’s market share.
T12A and Cerealsul wharves, which are located at Brazil’s Santos Port, serve as a major logistic port for COFCO’s agri-product business in Brazil. With an annual transit capacity of over 3 million tons, T12A is mainly used to export agri-products such as soybean, sugar and feedstuff. Through T12A, COFCO exports agri-products to major sales regions including China, Europe and the Middle East. As a wharf designed to import wheat, Cerealsul has an annual transit capacity of 500,000 tons. It not only realizes unmanned handling of goods from arrival, storage to loading through fully-automatic programmed management but also provides its clients with business intelligence services.