Australia's worst flooding in 50 years is likely to affect its ability to harvest and export wheat and sugar.
Archer Daniels Midland Co., the world’s largest grain processor, and Bunge Ltd. may benefit if flooding of Australian croplands shifts demand to other regions, said Rich Feltes, vice president of research for R.J. O’Brien & Associates.
“Natural disasters of that nature are a benefit to multinational companies,” Feltes said today in a telephone interview from Chicago. “It creates market imbalances. That is a plus for large, integrated firms like Bunge and ADM.”
The wet weather is likely to reduce the quality of Australia’s wheat crop, making it more suitable for animal feed than milling, Dennis Gartman, editor of the Gartman Letter LC, said today in a report. Demand for milling wheat will likely shift to the U.S., Feltes said.