Australia’s biggest farm services business, Landmark, will potentially be tapping a bigger choice of crop nutrition technology from North America in the wake of a Canadian agribusiness mega-merger unveiled last week.
Fertiliser giants Agrium and Potash Corporation of Saskatchewan plan to combine to create a $36 billion fertiliser and farm retailing behemoth.
Landmark has been one of Agrium’s southern hemisphere merchandise, advisory and livestock marketing outposts since late 2010 when the struggling AWB company was privatised and split up.
Despite some whispers in recent years suggesting Agrium was considering off-loading its Australian arm, Landmark management insists there has been no change to the company’s committed local focus.
The global Agrium-Potash partnership, if approved by US and Canadian anti-trust regulators, would make the new company the world’s biggest crop nutrient business.
In North America it would control 30 per cent of nitrogen and phosphate production and nearly two thirds of all potash output.
It would also become the third biggest resource company in resource-rich Canada, where Australian mining giant BHP Billiton was blocked from its own high-priced $40b bid for Potash Corp back in 2010.
BHP has other potash mining interests in Canada.
Landmark managing director, Tommy Warner, said the Canadian merger was no indication of any potential changes to Agrium’s strategy in Australia.
Business here was “going well” and focused on further developing close relationships with its customer base.
“It’s very much business as usual for us,” he said.
“The merger strengthens the message around what Agrium is about in the fertiliser market.
“I’d expect it to strengthen the technology and strategy options available for us to bring to the farmgate here in Australia.
“An expanded footprint will allow us to bring extra resources and minds together and bring new technology closer to customers.”
Mr Warner said Landmark would continue to focus close attention on what farm sector markets needed and respond to those signals across a broad and integrated business platform.
Last month Landmark expanded its wool business in Victoria buying the remaining half stake in broking company Arcadian Wool and lifting its share of Melbourne sale offerings to about 19pc.
Landmark now owns four wool company brands having also acquired Viterra Australia’s wool division three years ago.
The company has been open about looking to further grow its share of the wool broking pie, and acquire other agricultural assets, if the opportunities arise.
“If we can find a chance to service our customers better we want to have a good go at it,” Mr Warner said.
“We’re not just about about fertiliser and chemical business growth - our strategy is about strengthening our offering to clients.”
He said parent company Agrium’s merger plans with Potash Corp reflected its strategic growth and would help insulate the overall business against market downturns in different geographic and commodity areas.
The Agrium-Potash deal is the latest in a string of big agricultural merger moves this year.
It came the same week as chemical and seed giants Bayer and Monsanto agreed to a $88b merger.
ChemChina and Syngenta struck a similar $61b deal in February and US players DuPont and Dow Chemical Company also plan to merge and then carve out a new crop-science unit.
Agrium originated in fertiliser production in the 1930s, diversifying into the US and Argentine crop protection markets 20 years ago, and now also operates in Europe and Chile.
Its chief executive officer, Chuck Magro, will lead the new combined company where Potash Corp shareholders will own a majority 52pc stake and current Potash president, Jochen Tilk, will be executive chairman.
