Western Canadian crops are producing above-average yields and quality in the early stages of harvest, which looks to be bigger than usual, Canada's biggest grain handler Viterra said Thursday.
Viterra, which is in the process of being taken over by Glencore International, said the quality of the six major grains -- wheat, barley, canola, oats, flax and peas -- looked promising but would depend on favourable Canadian harvest weather over the next couple of months.
In South Australia, where Viterra is also the dominant grain handler, crops have had good growing conditions throughout the state. Quality of the crops, which are mostly wheat and barley, appeared good, the company said.
Viterra reported a 10 per cent fall in quarterly profit after taking charges related to taxes and early redemption of bonds.
Grain handling and marketing revenue rose to $2.21 billion in the third quarter from $2.19 billion a year earlier, mainly due to higher commodity prices, Viterra said in a statement.
Lower global shipping volumes "were offset by stronger grain handling margins and solid results from the company's international grain marketing activities," the company said.
Agri-products revenue rose 16 per cent to $1.31 billion, owing to strong fertilizer pricing and higher sales of crop protection products.
Viterra's processing segment saw higher revenue at $326.7 million, on improved results from canola, malt and oats operations, "in part offset by (Viterra's) pasta operation, which is experiencing competitive pricing pressures."
Processing margins per tonne slipped on "lower pasta margins and a change in product mix, as there are now more canola volumes given the new crush facility in China."
Net profit fell to $111 million, or 30 cents per share, from $123 million, or 34 cents per share, a year earlier. Overall revenue rose seven per cent to $3.64 billion.
Glencore has bid $6.1 billion for Viterra. Under the deal, which is awaiting regulatory approval from China, Glencore plans to sell some parts of Viterra to Canadian fertilizer company Agrium and private Canadian grain handler Richardson International. -- Reuters/AGCanada.com Network staff