Q3 2024 Earnings Summary
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Merger with Viterra | Discussed in Q2 , Q1 , Q4 with optimism about synergies and approvals. | Progress on integration; confidence in closing late 2024 or early 2025; no material regulatory issues. | Recurring bullish; continued optimism on closing and synergies. |
Significant capital expenditures and multiyear growth projects | Mentioned in Q2 , Q1 , Q4 as part of sustained long-term expansions. | CapEx at upper end ($1.2B–$1.4B); four large projects with biggest spend in 2025. | Consistent expansion; major investments remain on track. |
Merchandising segment underperformance | Q2 underperformance due to slower farmer selling, spot buying ; also noted in Q1 and Q4. | Mixed results: offset by strong financial services but lower in global grains. | Recurring challenge; no major improvement signaled. |
Limited visibility for future quarters | Q2: Inverted curves, low Q4 visibility , Q1: limited beyond three months , Q4: visibility drops after Q1. | Visibility beyond H1 remains low; cautious outlook. | Persistent caution; ongoing theme of uncertainty. |
Strong soybean meal and oil demand supporting crush margins | Q2: robust demand but spot buying ; Q1: higher inclusion rates, RD demand buoying oil. | Good meal/oil demand globally; supports margins in US/EU, weaker in China. | Positive recurring factor; continues to boost crush margins. |
Refined and Specialty Oils segment outperformance | Q2: exceeded expectations (resilient food demand) , Q1: solid but lower y/y , Q4: strong finish though slightly down y/y. | Segment performed well but down vs. strong prior year. | Consistent positive; resilient though moderating vs. prior peaks. |
Sale of sugar and bioenergy JV impacting earnings | Q2: down from last year, divestment seen as noncore ; Q1: weaker due to ethanol prices ; Q4: lower results. | Q3 underperformance; Q4 impact from lost income (~$0.15). | Bearish short-term; strategic exit lowers earnings but frees resources. |
Volatile EPS guidance and margin expectations | Q2: ~$9.25 with limited visibility ; Q1: ~$9 despite uncertainty ; Q4: ~$9 for 2024. | Q3 guidance ≥ $9.25 factoring JV sale, strong crush. | Recurrent caution; guided by spot buying and inverted curves. |
Renewable diesel expansion | Q1: new RD plants boosting oil demand ; Q4: growing RD capacity, shifting from refined to crude feedstocks. | No mention in Q3. | Not repeated in Q2/Q3; was previously bullish for oil demand. |
Palm oil supply tightness supporting soft oil prices | Q1: flat palm production reduces exports ; Q4: slower palm growth, rising biofuel use. No Q2 mention. | Soy oil competitive as palm supply remains tight. | Ongoing uplift; supports global vegetable oil prices. |
Potential margin pressure from increased global crush capacity | Q1: capacity expansions tempered by current margin environment. | Acknowledged; expansions offset by global meal demand and US export capacity. | Remains a risk; Bunge focusing on global demand alignment. |
Inverted margin curves affecting Q4 visibility | Q2: Q4 margin curves “very inverted,” limiting visibility ; Q4: curves inverted beyond Q1. | No direct mention in Q3. | Dropped in Q3; a prior concern in other quarters. |
CJ Selecta acquisition | Q1: closing later in 2024 ; Q4: expected to be accretive but not major in 2025. | No mention in Q3. | Ongoing; paused updates in Q3. |
Confidence in exceeding $11 EPS by 2026 | Q4: top management was very positive about surpassing $11. | No mention in Q3. | Mentioned only once; no follow-up in 2024 calls. |
Tight cocoa butter supply boosting specialty oils | Q2: tight cocoa butter supply aided tropical oils segment. | No mention in Q3. | Short-lived topic; not repeated afterward. |
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Viterra Acquisition Q: Does Viterra's recent performance affect the deal outlook?
A: Management remains confident in the Viterra acquisition, viewing it as a great fit with no impact on long-term earnings power. Despite delays in closing, which allowed for more integration planning, they expect regulatory approvals soon in Canada and China. There are no material changes expected to the transaction's economics. , , , -
Crush Margins Outlook Q: How durable are crush margins into 2025?
A: Strong crush margins are expected to continue, supported by good demand for soybean meal and oil, except in China. Softseed crushing margins are softer due to weather impacts, but soy crush margins remain resilient into the first half of 2025, offering potential opportunities above baseline. , -
Biofuel Policy Impact Q: Is soybean oil demand at risk due to policy changes?
A: While U.S. biofuel policy uncertainty could depress soybean oil demand in late Q4 and Q1, management believes export demand will offset this, as soybean oil is globally competitive against palm and soft oils. Reports of slowing soybean purchases are inaccurate; purchases are higher than in the last several years. They anticipate policy clarity to improve demand. , , -
CapEx Projects Timeline Q: When will growth projects impact EBITDA?
A: Four key projects are underway, with major spending in 2025. Commissioning is expected in late 2025 to early 2026, with material EBITDA contributions starting in the first half of 2026 and full run-rate by the second half. Normalized CapEx levels will resume in the back half of 2026. -
Meal Demand Outlook Q: Can meal inclusion rates increase further in 2025?
A: Soybean meal demand has been strong due to higher inclusion rates from attractive pricing and less competition from wheat and mid proteins. Management expects this strong demand to continue into 2025, predicting increased inclusion rates, but cannot see much past the first half. , -
Refined Products Performance Q: How will refined products perform in 2025?
A: Refined and Specialty Oils have been resilient, performing above the $400 million baseline. Management expects them to perform a bit better than baseline in 2025 due to strong food demand, even as refining premiums moderate and energy demand shifts toward crude veg oil. -
Sugar Business Sale Impact Q: What's the earnings impact from the sugar sale?
A: The sale of the sugar business removed about $0.15 of earnings from Q4 forecasts, with total second-half underperformance of around $0.35 due to weaker Q3 results and the sale. However, overperformance in the core business offset this impact. , -
South American Farmer Selling Q: When will farmer selling in South America pick up?
A: Increased farmer selling is anticipated in the first half of 2025, as policy clarity in Argentina improves and a large Brazilian crop provides confidence. This is expected to positively affect margins and supply dynamics. -
Increased Meal Capacity Q: Can the market absorb new meal capacity?
A: Management believes the global market can absorb increased U.S. meal capacity due to their ability to export and market meal globally. Investments in export infrastructure, like expanding capacity in the Gulf and PNW, will help connect supply with global demand. They anticipate the market will adjust as new capacity comes online.