“Perhaps it was the ancient nightmare of the middleman-merchant that made them all so aloof and secretive”, wrote Dan Morgan in his 1979 book Merchants of Grain. “The old fear that in moments of scarcity or famine, the people would blame them for all misfortunes, march upon their granaries . . . and confiscate their stocks.”
This time it is not hunger that thrusts the companies that control the world’s grain flows into the spotlight but dealmaking. The combination of US-listed Bunge with Glencore-backed competitor Viterra, in an $8.2bn deal, brings together two of the biggest traders of grains, oilseeds and other agricultural commodities, further tightening the grip of a handful of low-profile companies on the global market.
It is the biggest reshaping of the top tier of agricultural commodities since Cargill, long the biggest of the pack, bought the grain assets of Continental in 1999. The deal will catapult Bunge into second place among the four global traders, who go by the shorthand ABCD, to include Archer-Daniels-Midland and Louis Dreyfus. And while the alphabetic label is outdated and the market has changed dramatically since the 1970s, concerns around a concentrated system of global food production remain.