UPDATE 2-Bunge quarterly profit beats forecast; warns of Q2 headwinds
(Recasts, adds analyst quote, updates trading)
By Karl Plume
CHICAGO, April 28 (Reuters) - U.S. agricultural trader Bunge Ltd said Thursday it expects a rough second quarter due to shrinking crop prospects in South America, home to many of its elevators and processing plants.
The warning came even as the company reported better-than-expected first-quarter results on strong exports from the continent as weak currencies propelled demand for grain shipments from Brazil and Argentina.
"Customer demand is strong and global soy processing margins are improving. Smaller harvests in South America, due to recent adverse weather, are introducing new market dynamics," Chief Executive Soren Schroder said in a statement.
Excessive rain has damaged a portion of the Argentine soybean crop while drought in parts of Brazil is threatening to cut the country's winter corn crop.
Smaller crops may prompt farmers to hold a larger share of their harvest, which could erode margins for companies like Bunge and rivals such as Archer Daniels Midland and Cargill.
Bunge expects grain handling assets in the Northern Hemisphere to benefit from the South American crop shortfall, but only later in the year.
Its 2016 earnings growth forecast remained intact. Continuación...