Chapter 334: Four Major Grain Merchants ABCD
Milo basically stayed in Paris for the next few days.
Spend time with the children and Claude. Of course, at this stage, work is always with him.
Around him, no matter where he is, there is always a team of almost two hundred or nearly three hundred people surrounding him.
Not everyone will be with him, but these people are almost on call 24 hours a day to meet all his needs and consultations, including work and life.
For example, when he was with his children in Paris this time, he just talked with Chirac about the recent bad weather in France and the possibility of a poor harvest in France this year.
The two started talking about French grain and then moved on to commodities.
In return, Milo gave an order to the Blackburn Foundation.
Within a few hours, the global business intelligence network had collected all the information he needed.
This time, he set his sights on the global commodity trading market!
Bulk commodities refer to material goods that can enter the circulation field but not the retail link, have commodity attributes, and are bought and sold in large quantities for industrial and agricultural production and consumption.
The objects of commodity trading are not ordinary consumers, and it is difficult for ordinary people to access them.
Even more, many countries do not attach importance to this field or do not know much about it.
For example, after China joined the WTO in its previous life, it suffered a severe setback in commodity trading in 2004.
The four major international grain traders ABCD used bulk transactions to almost wipe out China's soybean companies, and took the opportunity to acquire major companies in China's soybean industry at low prices, opening up the entire industry chain.
Of the 40 million soybean farmers, half were laid off and had to leave their homes to become one of the 200 million migrant workers, causing a huge negative impact on society.
Let’s get back to the topic.
Soybeans are a type of bulk commodity and also belong to the category of agricultural products.
In fact, there are many kinds of bulk commodities, such as non-ferrous metal products such as gold, silver, copper, iron and aluminum, energy and chemical products such as crude oil, natural rubber, propane, heating oil, and agricultural and sideline products such as corn, soybeans, wheat, rice, cocoa, and cotton, all of which are bulk commodities.
For the convenience of classification, it is divided into three categories, namely energy commodities, basic raw materials and agricultural and sideline products.
In terms of commodity trading, Milo has actually been doing it for a long time and is a big shot in it.
Ultimately, the status of the commodity market is tied to the amount of resources owned.
When it comes to resources, Milo has too many, so relatively speaking, it has already had a very high market influence in many fields.
There is no need to talk about international crude oil, because it is backed by Texas, has its own oil company, and has close relations with Rockefeller.
Therefore, Milo actually controls a very high pricing power for international crude oil.
In terms of minerals, Textron, a giant lurking underwater, relies on the cheats and resources provided by Milo to rush on the road to becoming the mining overlord.
There is no shortage of resources in these areas, but there is a need to strengthen capabilities in areas other than mining.
After all, having resources in hand is one thing, but whether you can sell them at a high price and earn more profits is another matter.
But no matter what, with huge resources, you are already invincible.
In Milo's plan, Textron will focus on metal products among the three major categories of commodities.
ConocoPhillips, on the other hand, relies on the most basic crude oil to develop energy and chemical products such as heating oil, unleaded gasoline, propane and petroleum extracts.
Look at it this way.
He still has two obvious shortcomings in commodity trading.
The first is rubber, which is mainly produced in Southeast Asia, South America and parts of Africa.
There are more important agricultural and sideline products and the entire industrial chain.
In this regard, it’s not that he doesn’t have company, it’s just that it’s not strong.
For example, Paladin Agriculture, a first-tier subsidiary of Paladin Investments, owns companies such as Paladin Cotton, Paladin Sugar, and Paladin Tea, and has plantations and farms in the United States, Australia and other countries.
On a global scale, it is considered to be quite strong.
But in the final analysis, it's just okay.
So Milo now has a sudden idea to become a giant in the global agricultural and sideline products bulk trade.
The best way at present is to acquire the company. If we wait for our own development, it will take a long time.
Because he has sufficient capital, the easiest way is to take a high-level approach and acquire an existing industry giant.
There is no doubt that the four major grain traders ABCD were targeted by Milo.
These four companies are listed in the information collected this time.
Cargill, the American company and C among the four largest grain traders, later became the largest agricultural product trading giant.
Founded in 1865, Cargill is now over 120 years old.
To date, the privately held Cargill company is jointly controlled by the McMillan family and the Cargill family. The two families have been inseparable due to their marriage for hundreds of years.
Moreover, the management style of these two families is very stable and they do not like to operate with loans, so the development speed is relatively slow.
At this time, Cargill had already entered the Asian market and was truly expanding around the world, no longer limited to America and Europe.
A among the four major grain traders is the American company ADM, which was only established in 1902 and is now a top oilseed, corn and wheat processing company.
Unlike Cargill, this company is already listed and is currently run by the founding family, the Daniels family.
Because AMD was founded by two founders, Daniels and Archer, and later merged with Midland Corporation, its equity is not as concentrated as Cargill.
B among the four major grain traders is Bunge, but it is not considered an American company because its headquarters has not yet moved to the United States.
Bunge is also an extremely old company, older than Cargill. It was founded in Amsterdam, the Netherlands in 1818, and was already a major food supplier in the world before Cargill was established.
Currently, Bunge is not listed on the stock market. For more than 160 years, it has been in the hands of the Bunge family, who have a very strong control over it and cannot be shaken at all.
The last D among the four major grain traders is France’s Louis Dreyfus. Founded in 1851, the company’s development strategy is similar to that of Cargill, both of which are moving forward in secrecy, away from the public eye.
Currently, the Louis Dreyfus Company is also not listed and is controlled by the Louis Dreyfus family. The current head of the family and chairman of the group is Robert Louis Dreyfus, who holds 81% of the shares in the Louis Dreyfus Group. The remaining 19% of the shares are also concentrated in the hands of other members of the Louis Dreyfus family.
In addition to these four giants, there are also Ikam, Dalivan, Paul Reinhart, Olam and others in the global agricultural and sideline products bulk trading market.
However, most of these companies are very low-key, making huge fortunes in silence without going public, and their equity is relatively concentrated.
After finding out about these situations, Milo also felt a bit of a headache.
With his current wealth and capital, he has the funds to buy any of them and can even find a way to package them together.
But Milo knew very well that money was very useful, but it was not omnipotent.
The reason why ABCD has been able to dominate the market for so long is definitely not just because of their money, but also because they have powerful people behind them.
They are even the celestial dragons of this world.
Let's take a step back.
Put yourself in his shoes. If someone else wanted to buy his bank or securities company, how could he possibly sell it?
He won't sell it even at a five-fold premium!
This is no longer a matter of money. These companies are the foundation of their livelihood and cannot be sold! For these grain merchant families, the companies are also not for sale.
Otherwise, it would not have developed steadily and would not have been listed for hundreds of years.
Just like Cargill, even in later generations, it was not listed, and the entire family survived by guarding this company.
So it is extremely difficult for Milo to acquire these non-listed companies now!
"No matter what, we still have to give it a try. Otherwise, it will take a long time to develop on our own."
“Try any of ABCD, but focus on ADM and Bunge, as these two companies have the highest chance of success…”
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After making a decision.
Milo immediately asked Blackburn Fund to issue orders.
Among them, Paladin Investments is responsible for contacting France's Louis Dreyfus and the Netherlands' Bunge.
Paladin Capital was responsible for contacting Cargill and ADM.
As for other companies such as Ikam, Dalivan, Paul Reinhart, and Orlan, they are regarded as alternative options.
Of course, if it were possible to acquire one of the four major grain traders.
The above companies can also be targets for mergers and acquisitions to enhance one's own strength and improve the global industrial layout.
After all, it can be seen from the survey data that the four major grain traders now are not the four major grain traders in the future. None of them has achieved absolute dominance in the market, and they are all still in the process of expansion.
For example, ADM only formulated its European expansion strategy this year and is now trying to expand through mergers and acquisitions in the Netherlands and Germany.
After giving orders for the following actions.
Milo's work focus remains in the field of bulk agricultural products trading.
The acquisition of these four major grain traders will not affect Paladin Agriculture's continued expansion.
You can continue to buy land in the United States. Places like Australia, South America, and even Ermao are all good places for expansion.
At the same time, Asia cannot be spared.
Forget about that country.
Once the land is nationalized, it will be useless for any giant to enter.
The only breakthrough point is Southeast Asia, where rice production accounts for 18 percent of Asia’s total rice production and one-sixth of the world’s rice production!
Because of Southeast Asia's unique climate, rice accounts for more than 80 percent of the cultivated land area for food crops in Southeast Asian countries.
Southeast Asian countries are also highly dependent on rice exports, and the rice exports of Southeast Asian countries account for two-thirds of Asia's total rice exports.
Of course, Southeast Asia’s influence in the rice sector can be seen from many data.
However, if we analyze some data more deeply, we can see that Southeast Asian countries still have a lot of room for improvement in the entire rice industry chain.
For example, in contrast, Japan has a large population and a small amount of land, and has been cultivating the land intensively.
In 1977, the rice yield per hectare historically exceeded 60 quintals, one quintal equals 100 kilograms, so the yield per hectare is more than 6 tons.
This is the output of hybrid rice in China without any technology export.
As for Southeast Asia, only Indonesia and Malaysia had an annual production of more than 20 quintals per hectare during the same period.
In countries such as Myanmar, Cambodia, Thailand, and the Philippines, none of them has a yield of more than 20 quintals per hectare. The lowest yield in Thailand is less than 120 kilograms per mu! In Indonesia and Malaysia, where the yield is higher, rice is the second largest crop after rubber.
This is not the case in other countries.
From this point, it can be seen that countries such as Myanmar, Cambodia, Thailand, and the Philippines have not fully utilized the land and all use extensive planting management.
Even if the rice production on these lands more than triples, it will only be barely on par with the rice yield in Japan.
However, with a rice planting area of nearly 25 million hectares in these four countries, if they could catch up with Japan's planting level, the output would increase by nearly 100 million tons.
Not to mention the output after the mainland's hybrid rice technology was promoted to Southeast Asia.
Therefore, now is the perfect time to delve deeper into the rice industry in Southeast Asian countries.
Since China, a major rice-growing country, does not export rice, deep control over the rice industry in Southeast Asian countries is enough to create a world-class food giant.
In addition to Southeast Asia, India on the South Asian Peninsula is also a major agricultural country.
Due to its unique geographical environment and climatic conditions, Indus has a very high position in crops such as cotton, rice, wheat, corn and jute.
Take cotton for example. India is the world's largest cotton producer, accounting for more than a quarter of the world's cotton production.
Food, clothing, shelter and transportation are the four major needs of life. If you can influence any one of them, you are already a world-class rich man.
If you can control more than one-third of any one of these, your voice will be heard by the whole world.
The most direct impact of commodities is on food, clothing, housing and transportation.
After all, compared with companies in the fields of heavy industry, finance and media, Milo did not pay enough attention to it before.
After he climbed to his current high position and became the leader of the Boston Consortium.
Only then did I realize more and more what I and the Boston Consortium were lacking.
It is obvious that what he, the Boston Consortium, and even the surrounding friendly consortiums lack most is influence in commodities such as food, rubber, and cotton.
In fact, several major conglomerates are also lacking in this aspect, because their focus is actually on finance.
The great Morgan focused on steel and transportation, Rockefeller focused on oil energy, Chicago focused on business, and California focused on aerospace technology...
When it comes to food, clothing, housing and transportation, big conglomerates are either unable to provide the services or can only cooperate with companies like Cargill.
Maybe this is a breakthrough?
Milo thought so.
(End of this chapter)