NEW YORK Jan 15 Louis Dreyfus Commodities, the
world's largest cotton merchant, has set up a joint venture with
Namoi Cotton Co-operative Ltd to sell fiber produced by one of
Australia's biggest co-operatives, Namoi said on Tuesday.
The move is a further sign that the unprecedented volatility
in cotton prices over the past four years that caused widespread
contract defaults continues to roil the market.
Namoi will continue to own and operate its ginning and
cotton seed business, but the venture will take over Namoi's
marketing and commodities packing assets.
Namoi will hold a 51-percent stake in the venture, with
Dreyfus, one of the world's biggest agricultural traders, owning
the remaining 49 percent.
The news comes after the co-op lost almost AU$70 million
($74 million) in its last financial year to end-February 2012 as
textile mills reneged on sales contracts and borrowing costs
increased due to wild swings in prices.