US agro giant Cargill makes big bet on Ukraine

Kiev (AFP) –


US agriculture giant Cargill signed a major investment deal in a Ukrainian grain terminal Wednesday that Washington's ambassador said could help turn the struggling former Soviet republic into an exporting "superpower".

"Cargill has decided to invest $100 million (91 million euros) in the construction of a grain terminal (in the Odessa region) Yuzhne port so that it can become one of the largest hubs in Ukraine," Prime Minister Arseniy Yatsenyuk said at the signing ceremony.

"This was a first step made by Ukraine that makes our American partners see us as a truely reliable and good place for making investments."

Agriculture Minister Oleksiy Pavlenko said Ukraine -- once known as the breadbasket of Europe -- planned to exported a record 37 million tonnes of grain between July 2015 and June 2016.

Officials said the port will have an initial annual loading capacity of five million tonnes of grain.

It was not immediately clear when Cargill's export through the southwestern Ukrainian port would begin.

The deal with Ukraine's M.V. Cargo loading and unloading firm comes against the backdrop of foreign investor jitters about doing business in a country struggling to root out corruption and fighting pro-Russian insurgents in the separatist east.

"Ukraine is already one of the world’s great agricultural producers, but it should be an agricultural superpower," US Ambassador Geoffrey Pyatt said in remarks released by his office.

But Pyatt added that future US agricultural investors were looking for the pro-Western leadership in Kiev to demonstrate "a clear and unambiguous commitment to the path of reform."

"And they are looking for a government and a presidency that demonstrates a clear commitment to continued progress on the rule of law, to include the critical issue of anti-corruption reform," Pyatt was quoted as saying at the signing ceremony.

Ukraine has been riven by weeks of political turmoil that has seen officials and ministers trade accusations of influence peddling and graft.

The ruling coalition has been coming apart at the seams since Yatsenyuk won a February 16 no-confidence vote that came only hours after President Petro Poroshenko urged his government leader to step down.

The tumult has sparked worry among some of Ukraine's allies that Kiev may be failing to follow through on the hopes for change of pro-EU protesters that toppled the country's Russian-backed leadership in February 2014.

Cargill is a 150-year-old global conglomerate that reports operating around 500 cargo vessels a day.

It has been ranked as the largest US unlisted company by Forbes magazine.