By Jim Davis, BusinessUkraine weekly magazine, Kyiv, Ukraine, Monday, July 28, 2008 A fairly recent addition to Ukraine's major agriculture and food companies, nevertheless Bunge has since 2002 gained a reputation for its community involvement and outstanding human esource practices.

Founded in 1818 in Amsterdam as an export/import trading firm, Bunge has gone on to become a recognised world leader in global agribusiness. Bunge's integrated operations, now headquartered in the United States, circle the globe, stretching from the farm field to the retail shelf. The Bunge family in Ukraine is a part of 22,000 employees worldwide at over 450 facilities in 32 countries, all dedicated to improving the global agribusiness and food production chain.

HELPING UKRAINE TO GLOBAL SUNFLOWER DOMINATION Bunge Ukraine's operations are an extension of the company's Agribusiness and Edible Oil Products divisions. The Agribusiness division is one of the world's largest oilseed processors and a major global grain trader, while the Food products division is a major supplier of edible oils and shortenings to food processors and foodservice customers, and is a leading supplier of consumer edible oils and related products in select markets. Bunge is the world's largest seller of bottled vegetable oils to consumers and has played a major role in making Ukraine a world centre for sunflower seed oil (sunoil) production and marketing. A CHALLENGING ENVIRONMENT TO DO BUSINESS Dmitry Gorshunov, Managing Director of Bunge Ukraine made it clear in an interview with Business Ukraine that the company considers its Ukraine operations a part of the company's long-term strategic plans. "Bunge fully intends to continue its growth in Ukraine.

The Ukrainian environment is challenging but with those challenges come opportunities," Mr. Gorshunov says. Bunge first invested in Ukraine through its 2002 purchase of Cereol, which at the time owned a Dnipropetrovsk facility that processes sunflower seed to make bottled cooking oil. Since that initial purchase Bunge has increased the size of the Dnipro facility by 50%. In addition to its extensive sunoil operations, Bunge has purchased several grain elevators and has also invested in construction of another oilseed processing facility in Illyichevsk. Already a leading sunseed processor through its facility in Dnipropetrovsk, the company has recently finished commissioning a jointly-owned sunseed processing facility in Illyichevsk. Bunge plans to operate the new plant during the coming season, and consider opportunities to crush alternative crops there as well, such as rapeseed. In addition, Bunge have substantially grown its capabilities in grain origination over the past several years. In 2005/2006 (the last season in which grain exports were not restricted by government quotas), Bunge was the leading exporter of grains from Ukraine. Since then the company has invested in its grain elevators.

INVESTING IN A FUTURE WORLD LEADER However, Bunge believes it is more important that the company has built a strong team to handle trading, risk management and logistical support. Bunge has already negotiated a substantial throughput agreement with one export grain terminal, and is working to negotiate another. "High commodity prices have sent a call to farmers worldwide that more grain and oilseeds are needed. Ukrainian farmers are uniquely positioned to respond to that call, as there is a lot of room to improve farming practices and inputs, especially as funding becomes increasingly available. "We at Bunge believe that Ukraine will become one of the world's major suppliers of grain and oilseed products, and we intend to participate in that growth by investing further in the human and physical infrastructure needed to bring Ukrainian products to the world," Gorshunov says. On the food side of its operations Bunge is currently the second largest supplier of bottled oil to Ukrainian consumers. Its flagship brand, Oleina, was the first refined, bottled oil in Ukraine, and it remains one of the strongest brands in the market. Bunge says it will continue to invest in its food business and is actively exploring new avenues for growth including other categories beyond bottled oils.

DEFYING THE RAIDERS: A LONG-TERM COMMITMENT Bunge has been the target of so-called raider attacks that have made life difficult for some other foreign investors in Ukraine. However, Gorshunov made it clear that such attacks will continue to be very vigorously repelled and will not discourage company management and employees who support the company's strong position as a good corporate citizen. "Bunge has for the past several years suffered repeated attacks from corporate raiders. These attacks have taken a wide variety of forms, ranging from lawsuits regarding our shareholdings and brands, to media attacks and even pamphlets making ridiculous allegations against the Oleina brand.

These attacks have caused us to divert a lot of time and effort from our business into legal defences and public relations work, but they have not changed our overall strategic direction in Ukraine. "Throughout this process we have continued to build our business, invest in our people and invest in our infrastructure. Moreover, we believe that as Ukraine is increasingly integrated into the community of nations through trade and through vehicles such as the WTO, such issues will subside and Bunge will be able to focus its efforts on building its business, which in turn will help to bring economic growth and individual prosperity to Ukraine," Gorshunov concludes.

LINK: http://www.businessukraine.com.ua/sunflower-oil-empire