Bunge Ltd Q4 2014 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Ann Duignan - JPMorgan - Analyst : Hi. Good morning, guys. It is Ann Duignan here.

Question: Ann Duignan - JPMorgan - Analyst : Can you talk a little bit more about the fundamentals of ethanol in Brazil? I know their increased tax and the increased blending are a positive. What about the impact of lower oil prices and the real? Are there any other positives or negatives going into 2015?

Question: Ann Duignan - JPMorgan - Analyst : Okay, that's helpful. I appreciate that. Then can you talk about the strike on the West Coast, whether that's impacting your ability to get crops out of the United States? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2015 / 3:00PM, BG.N - Q4 2014 Bunge Ltd Earnings Call

Question: Ann Duignan - JPMorgan - Analyst : And you don't anticipate any impact going forward?

Question: Ann Duignan - JPMorgan - Analyst : Okay. I will get back in the queue and follow-up. Thanks.

Question: Adam Samuelson - Goldman Sachs - Analyst : Yes, thanks. Good morning, everyone. A question in agribusiness and trying to think through the outlook and evaluate. How, if at all, has the outlook changed and some of the key business areas relative to the analysts meeting in December? And how did the -- do the four key performance in agribusiness hit your expectations as you thought -- where you though you would be at the analyst meeting in December? Or does the ultimate of China inventory adjustment, the negative European sunseed farmer selling in Brazil, et cetera?

Question: Adam Samuelson - Goldman Sachs - Analyst : Maybe just on China on the crush side, I mean 2014 was a very tough year for yourselves and really the whole industry there. But the outlook commentary you did point to continued over-capacity in the industry there. And has that made you rethink some of the investments that you made in the space there and the need to actually be in crush in China? And rather than stay an exporter our of Brazil and the US and keep the crushing in the Western Hemisphere?

Question: Adam Samuelson - Goldman Sachs - Analyst : Okay, that's helpful. And then maybe last from me on the capital allocation front looking ahead. I know the investment grade rating remains critical foundation for how you think about capital. But help us evaluate or think through incremental -- the opportunity to take on a little bit more leverage in the context of that rating and the appetite to do so for M&A versus repurchase looking into 2015?

Question: Adam Samuelson - Goldman Sachs - Analyst : Okay, thanks very much.

Question: Cornell Burnette - Citi Research - Analyst : Good morning. This is Cornell Burnette in with a few questions for David. Just wanted to talk a little bit about mark-to-market. I believe back in the first quarter there were about $50 million in mark-to-market losses related to ocean freight, which I believe weren't expected to reverse out until, I believe, the first half of 2015. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2015 / 3:00PM, BG.N - Q4 2014 Bunge Ltd Earnings Call So want to know if I got that right. And then just in general, that inclusive of the $80 million mark-to-market loss in the fourth quarter would imply that there's something like $130 million of benefits from mark-to-market in the first half of 2015? Just want to see if that's correct.

Question: Cornell Burnette - Citi Research - Analyst : Okay, great. Then looking at your ROIC targets for agribusiness and food. Going to 9% return next year versus 8.4% last year seems to imply about a $100 million improvement combined from those two segments. And I wanted to know, given the fact that you will have an $80 million benefit from mark-to-market presumably next year, how much better can the number be versus that 9% figure that you gave out?

Question: Cornell Burnette - Citi Research - Analyst : Right, right. Exactly. One more question is just obviously with the large crop expected in South America, I guess we will start to see better selling from farmers as we move closer to the harvest. Just wanted to get your take on how things are progressing out and what's your read on farmers selling during the first quarter?

Question: Cornell Burnette - Citi Research - Analyst : Okay, thanks a lot. That's all for me.

Question: Tim Tiberio - Miller Tabak - Analyst : Good morning. Thanks for taking my question. Soren, with regards to your comments on increased capacity in the oilseed space in China, can you frame up how much of the crush margin pressure is result of capacity building versus the fact that China really has been in a process of substantial hog herd contraction? I think sell herds are down 12% in the country. And looking at that backdrop, can you explain why you think, outside of obviously the edible oil space, why that would be necessarily more positive for 2015 versus 2014 if we are in a situation where you are not seeing as much hog expansion in China?

Question: Tim Tiberio - Miller Tabak - Analyst : Great. And then my next question, looking at the expansion of port terminal capacity in the northern arc within Brazil, there's been, I guess, mixed commentary around the improvement of road conditions through the Amazon and the capacity to, I guess, get product to those terminals in relation to the capacity that has been built. Can you just give us a sense of how you are viewing the traffic congestion in the first half of 2015? And whether it may take a little bit longer to actually tap into that obviously latent demand that everyone is expecting because of the transportation benefit towards the northern arc of Brazil? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2015 / 3:00PM, BG.N - Q4 2014 Bunge Ltd Earnings Call

Question: Tim Tiberio - Miller Tabak - Analyst : Okay. But as far as the return profile it doesn't seem that you're concerned that potentially port terminal capacity could get out ahead of the ability of the transportation infrastructure to keep up?

Question: Tim Tiberio - Miller Tabak - Analyst : Great. Thanks for taking my questions.

Question: Ken Zaslow - BMO Capital Markets - Analyst : Good morning, everyone.

Question: Ken Zaslow - BMO Capital Markets - Analyst : I have a couple questions. One is how much of your total capacity of ag business is in China? And what was the full impact of China in 2014?

Question: Ken Zaslow - BMO Capital Markets - Analyst : So if I think about it, is $100 million a reasonable guess? I'm not asking for an exact number, but it sounds like the $30 million plus it sounds like $70 million of less than exciting margins seem to be the right answer. Is that a fair bet?

Question: Ken Zaslow - BMO Capital Markets - Analyst : Okay. Then how does this quarter's profit in agribusiness translate into a run rate going into 2015? If I add back the $80 million, is that -- is the ag business what it would be with that $80 million a run rate, a quarterly run rate? It sounds like what you're trying to tell us is, look, each quarter has a good predetermined flow of earnings that's associated with that. Is that a fair way of looking at it? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2015 / 3:00PM, BG.N - Q4 2014 Bunge Ltd Earnings Call

Question: Ken Zaslow - BMO Capital Markets - Analyst : On your tax rate, just to make sure, you are not actually paying cash taxes of that 50% tax rate that you had today? That you reported today?

Question: Ken Zaslow - BMO Capital Markets - Analyst : You're not physically paying that? That is a non-cash tax number that you are actually putting out that hit your numbers. Is that a fair way of looking at it?

Question: Ken Zaslow - BMO Capital Markets - Analyst : Okay. The last question on sugar is, given that the environment -- what is the quality to which that you are able to forecast this business? It seems like you're really not that good at that. And why this year (Multiple speakers).

Question: Ken Zaslow - BMO Capital Markets - Analyst : Yes. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 12, 2015 / 3:00PM, BG.N - Q4 2014 Bunge Ltd Earnings Call

Question: Ken Zaslow - BMO Capital Markets - Analyst : In sugar.

Question: Ken Zaslow - BMO Capital Markets - Analyst : What is the level of confidence you have in it this time? It almost sounds like you have more confidence, but I can't figure out exactly why.

Question: Ken Zaslow - BMO Capital Markets - Analyst : Great. Thank you very much.

Question: Tyler Etten - Piper Jaffray - Analyst : Yes, I'm here. This is Tyler Etten on for Brett Wong. I was just -- I had a question about Brazil exports, what you guys' anticipation will be for the first quarter out of there, and if you expect the same strength out of Europe that you saw in 2014 out of the crushing business?

Question: Tyler Etten - Piper Jaffray - Analyst : All right, thank you.

Question: Robert Moskow - Credit Suisse - Analyst : Hi. Thank you. Soren, I was hoping to get some further color on Brazil and your expectations now. The farmers selling certainly seems like -- a slow farmer selling sounds short term like it always is. But regarding crash utilization and profitability and crush margins in Brazil, why should that get better? Is that just going to get better because there's more volume to crush, or is there also a good demand function in Brazil right now for livestock production and livestock producers?

Question: Robert Moskow - Credit Suisse - Analyst : Kind of a follow-up to Ken's question, I think. If I look at 2014 there were ocean freight, kind of hedging issues and then the China basis miss in fourth quarter. But my understanding is that you have instituted policies and made people changes so that the Company's taking less risk, not more risk. Can you talk a little bit about whether these hiccups this year, were they a function of gee, we had too much risk in our positions, or we were taking too much of a view in our positions. Or was it just that hey, the markets went the wrong way and that's just a course of doing business. We do our best but we cannot -- some things are just inherently unpredictable.

Question: Robert Moskow - Credit Suisse - Analyst : All right. Maybe I will follow up on that. But my last question is, with the $80 million mark-to-market charge potentially benefiting the first half of 2015, have you raised internal expectations for what 2015 can deliver? Have you factored that in?

Question: Robert Moskow - Credit Suisse - Analyst : Okay, great. Thank you.