Bunge to spend $750 mln to expand in Brazil cane

SAO PAULO, April 9 (Reuters) - U.S. agribusiness group Bunge BG.N will invest $750 million to expand its three largest cane mills in Brazil, the unit's chief executive told Valor Economico newspaper in an interview published on Friday.

The investments are part of the firm’s $2.8 billion three-year plan for 2010-2012 to propel Bunge’s expansion in the South American country into sugar and ethanol, after the $1.5 billion acquisition of local miller Moema, Valor said.

Eighty percent of the budget plan will focus on sugar and ethanol projects, signaling an effort to boost organic growth in the sector, Valor said. The Moema purchase made Bunge Brazil's third-largest sugar and ethanol group, after leader Cosan CSAN3.SA and France's Louis Dreyfus group.

“The sugar and bioenergy area is new for us and we look upon it with great enthusiasm,” Pedro Parente, head of Bunge’s Brazil unit, said in the interview.

Bunge is targeting annual cane crushing capacity of 30 million tonnes by 2012 and aims to raise current capacity to 20 million tonnes by June.

Foreign capital has been flowing into Brazil’s sugar and ethanol sector, with investors eyeing bright prospects for its comparatively efficient biofuels production and after the global economic crisis made financially vulnerable mills easy prey for take-overs. (Reporting by Peter Murphy; Editing by Walter Bagley)