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Viterra says undeterred by credit crunch

Viterra, Canada’s largest grain company, has a strong balance sheet and continues plans for growth despite the financial crisis, its chief financial officer said Oct. 6.

Viterra raised $441 million earlier this year for acquisitions and renegotiated long-term financing, well ahead of the turmoil now gripping capital markets, Rex McLennan said in an interview.

“We expect that our plans going forward are not going to be impacted by the current circumstances, which, by the way, we don’t believe are going to be long-lived in any case,” he said.

Viterra’s stock was hit hard by the credit crunch, falling 11 per cent on Oct. 6 to $8.11 on the TSX. Since June, it has dropped more than 45 per cent.

But McLennan said the agricultural sector continues to have strong fundamentals because of growing population and demand for food in emerging economies.

“We’re all getting tarred with the same brush,” he said. “I think as things settle out, there will be a recognition that some sectors are just not going to be impacted the same way, and the agribusiness sector is one of those sectors, perhaps almost a unique sector.”

Canadian farmers have seen their net income grow by 16 per cent year over year, and continue to have adequate access to credit to cover the costs of planting crops, McLennan said.

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