The leading oilseed and agricultural processing firm this year faced a tough operating environment in Brazil, which resulted in a sharp hit to profits earlier this year. But wide-reaching reorganization efforts and improvements in the Brazilian market have resulted in Bunge stabilizing its business in its second half financial year, despite a continued moderate dip in volumes. According to the firm's chairman and chief executive officer Alberto Weisser, the company still faces certain challenges in Brazil, such as the strong real, but large new corn and soybean crops and continued government support have improved farm economics in the country. "Steps taken in late 2005 and early 2006 to restructure our Brazilian businesses, lower costs and enhance our foreign currency risk management should position Bunge to benefit from improving Brazilian market conditions," he said. The firm is also focusing on building up a "balanced, global business" that will enable it to better cope with future challenging periods as they occur. Sales for the company's fourth quarter ended December 31 2006 reached $7.7bn, up 14 percent from the previous year. Sales for the year were up 8 percent to $26.3bn. Net income for the quarter jumped 77 percent, although income for the year still saw a 2 percent decline to $521m, from $530m last year. Volumes in the firm's agribusiness were down 3 percent in the year, but these were more than offset by higher oilseed processing margins in South America, said Bunge. Net sales for the division were set at $19bn. Edible oil segment results improved primarily due to increased volumes and margins in Brazil. Total volumes were up 4 percent in the year, with sales up 6 percent to $3.6bn. Bunge's milling products division also saw strong results due to higher wheat milling margins resulting from rising international wheat prices. Bunge benefited from low raw material costs as it purchased much of its inventory prior to the rise in prices. Sales for the year increased 12 percent to $965m. The firm said it ended 2006 on "promising" note, and forecast net income for 2007 of $590m - $610m. Bunge said it is taking a "focused approach" to the biodiesel and corn ethanol industries, but that its overall strategic focus remains on the agribusiness and food industries, where it plans to capitalize on growth through a number of investments. In 2007, the company expects to expand capacity at its sunseed crushing plant in Martfu, Hungary to grow its presence in Eastern Europe, and also build a new wheat mill in northeastern Brazil to improve production efficiency. It will also complete its two Canadian crushing and refining capacity expansion projects and increase its presence in the global sugar and sugar-based ethanol markets. Furthermore, the firm's oilseed processing facilities in Ukraine, Russia and Spain and its new grain terminals in the port of Santos, Brazil will come fully online during 2007. "Ours is a growth industry with compelling opportunities," said Weisser. "We will invest to capitalize on them."