June 20, 2012

 

Philippines' CalataCorporation in talks with Argentine companies for corn farms

 

Newly listed Philippine firm Calata Corporationseeks partnership with companies from Argentina for a joint venture large-scale corn production in the Philippines.

 

In a disclosure to the local bourse, Calata said that they are already in preliminary discussions with some Argentine firms that produce corn commercially and supply mechanized corn production equipment.

 

Argentina has been known to be one of the leading countries in successfully utilizing modern technology and advanced farming practices in corn production, Calata said.

 

The planned large-scale production of corn is intended to complement its memorandum of agreement (MOA) with state-run National Agribusiness Corp. (NABCOR), an attached agency to the Agriculture department.

 

Under the MOA, which was signed last week and will be in effect for 25 years, the Calata is set to help farmers grow corn using inputs from the company and then buy the produce in bulk.

 

The deal is an equity-to-equity contract, wherein all the products manufactured in the NABCOR facilities through the implements from the agricultural firm will be up for retail.

Corn processing and trading centres located in the northern parts of the country are the targeted areas for the partnership.

 

The company plans to plant corn farms with a total land area of up to 20,000 hectares.

 

The firm's commercial production of corn will create a high quality and sustainable source of corn inputs for its partnership with NABCOR, it said.

 

Calata added that foreign governments have also expressed interest in inking long-term purchase contracts for corn.

 

The corn supply imported from Calata shall be intended for their domestic animal feeds industry and also for their biofuels production.

 

The eyed venture comes on top of the firm's plans to roll out 100 retail stores in Luzon, in addition to the 115 existing Agri Retail Stores operated by its affiliate, Agri Phil Corp.

 

Calata, which made its debut on the Philippine Stock Exchange (PSE) in May, managed to buck the market's drop, with shares closing 2.67% higher than the listing price.

 

In 2011, Calata grew net income nearly three times to PHP100.17 million (US$2.37 million) from PHP33.84 million (US$803,227.85)  the preceding year, while sales rose 11.11% to PHP2.0 billion (US$47.58 million) versus PHP1.80 billion (US$42.82 million) two years ago, earlier reports showed.