A Member of Pat McKeough’s Inner Circle recently asked for his advice on a leading global agribusiness and food company specializing in sourcing, processing, and supplying oilseeds, grains, and specialty ingredients.
Pat likes the firm’s strategic maneuvers and demonstrated operational efficiency. Its transformative merger with Viterra a game-changer which positions the company for significant growth and cost-saving synergies in the coming years. However, Pat notes the company’s profitability is heavily dependent on global commodity prices for crops like soybeans, corn, and wheat. These prices can fluctuate wildly due to factors like weather patterns, geopolitical tensions, and government policy changes.
Bunge Global SA (Symbol BG on New York; www.bunge.com) is a leading global agribusiness and food company.
The company is a leader in its industry on several fronts: it processes oilseed, such as soybeans, and produces and sells vegetable oils and proteins; it processes grains; and it also produces and sells wheat flours, bakery mixes, and corn-based products across North and South America.
In Brazil, Bunge also produces sugar and ethanol through its 50% interest in BP Bunge Bioenergia, a joint venture with oil and gas giant BP plc.
In October 2023, Bunge’s shareholders voted to change the company’s place of incorporation and residence from Bermuda to Switzerland.
The company now operates through three segments: Agribusiness, Refined and Specialty Oils, and Milling.
The Agribusiness segment buys, stores, transports, processes, and sells agricultural commodities and commodity products. Operations are in North and South America, Europe, and Asia-Pacific. It also has distribution offices throughout the world.
The Refined and Specialty Oils segment sells vegetable oils and fats. These include cooking oils, shortenings, specialty ingredients, and renewable diesel feedstocks. Operations are mostly located in North and South America, Europe, and the Asia-Pacific region.
The Milling segment sells wheat flours, bakery mixes and corn-based products. Operations are in North and South America.
On July 2, 2025, Bunge and Viterra Ltd. completed their merger in a deal that saw Bunge pay $8.2 billion. The combination will provide several advantages for Bunge. These include a significant increase in the company’s grain and softseed handling capacity. Bunge also gains access to key regions and crops where it is underrepresented.
In another transaction, on October 1, 2024, Bunge completed the sale of its 50% share in BP Bunge Bioenergia to BP plc, which now owns 100% of the business. BP Bunge Bioenergia is one of Brazil’s leading biofuels-producing companies. The sale price was $828 million.
Long-term prospects are sound—but near term is challenging
In the three months ended June 30, 2025, Bunge’s revenue dropped 3.6%, to $12.8 billion from $13.2 billion a year earlier. Excluding one-time items, Bunge earned $178 million, or $1.31 a share, in the latest quarter. That was down 28.2% from $248 million, or $1.73 a share. However, it did beat the consensus estimate of $1.19 per share.
Bunge and other agribusiness firms including Archer-Daniels-Midland and Cargill have seen profits erode in recent quarters due to expanded global crop supplies and lower profit margins.
Trade tensions fueled by the Trump administration’s tariffs have further disrupted trade flows as importing nations have slowed purchases amid the U.S. president’s shifting deadlines for imposing duties.
Meanwhile, biofuel policy uncertainty hurt demand for green energy feedstocks like soybean oil, although proposed increases for biofuel blending in the U.S. and Brazil was positive in the longer term for Bunge.
Bunge raised its quarterly dividend by 2.9% with the June 2025 payment, to $0.70 a share from $0.68. The stock now yields 3.3%.
The company’s long-term prospects are positive. Views vary on the outlook for world population growth. Birth rates have dropped below replacement level in many countries, and it is widely believed that world population is now leveling out and will move downward in decades to come. However, the emphasis in Bunge’s business may shift from low cost and high volume to higher-cost, higher-quality products.
There is widespread and growing belief in the U.S. that its worsening health in the past few decades is due to industrialization of the food supply—aiming to cut costs by introducing questionable methods and ingredients. The Trump administration continues to make healthier foods an important part of its mandate.
Meanwhile, Bunge shares trade at just 11.8 times the 7.13 a share the company is forecast to earn in 2025. That’s a low multiple but reflects uncertainty about the company’s near-term outlook.
Recommendation in Pat’s Inner Circle: Bunge Global is a buy for income and long-term growth.
