(Releads, adds Cargill quotes, detail on joint venture)
KIEV, Feb 24 (Reuters) - U.S. agriculture giant Cargill and Ukraine’s M.V. Cargo said they would build and operate a grain terminal at Ukraine’s Black Sea port of Yuzhny under a $100 million joint venture agreement signed on Wednesday.
The terminal, near Ukraine’s biggest port city of Odessa, will have an annual loading capacity of 5 million tonnes of grain and other commodities, Andriy Pivovarsky, Ukrainian infrastructure minister, said after the signing ceremony.
Ukraine, which is set to export a record amount of grain this year, has said it wants to double loading capacity for grain exports from its ports over the next few years.
“Through this investment Ukraine’s port infrastructure will be expanded and will provide greater efficiencies to connect Ukraine’s surplus agricultural crops with the parts of the world demanding more food,” Andreas Rickmers, head of Cargill’s grains and oilseeds business in Europe, said at the signing ceremony.
“It will add to our footprint of port facilities in the Black Sea region and confirms our intention to keep investing in Ukraine’s agricultural sector,” he said.
Cargill, one of the world’s largest privately owned corporations, said construction of the terminal would begin this month and was expected to be completed by the spring of 2018.
Odessa-based MV Cargo will finance the project with private funds as well as a loan, currently under discussion, from the European Bank for Reconstruction and Development and the International Finance Corporation, a spokeswoman for Cargill said.
The joint venture will operate the terminal and Cargill will be a major customer, but the facility will also be open to third parties, she said.
Ukraine is currently able to ship about 35 million tonnes of grain from its sea ports but the government has said it wants to double export loading capacity within the next five years.
Ukraine is likely to export a record 37 million tonnes of grain this season. (Reporting by Pavel Polityuk; Editing by Mark Potter and Susan Fenton)