Third Quarter 2009 Overview

Foreign Currency Exchange Rates

Due to the global nature of our operations, our operating results can be materially impacted by foreign currency exchange rates. Both translation of our foreign subsidiaries' financial statements and foreign currency transactions can affect our results. On a monthly basis local currency-based subsidiary statements of income and cash flows are translated into U.S. dollars for consolidation purposes based on weighted average exchange rates during the monthly period. As a result, fluctuations of local currencies compared to the U.S. dollar during a monthly period impact our consolidated statements of income and cash flows for that period and also affect comparisons between periods. Subsidiary balance sheets are translated using exchange rates as of the balance sheet date with the resulting translation adjustments reported in our consolidated balance sheets as a component of other comprehensive income (loss).

Additionally, we record transaction gains or losses on monetary assets and liabilities of our foreign subsidiaries that are denominated in U.S. dollars. These U.S. dollar-denominated amounts are remeasured into their respective subsidiary functional currencies at exchange rates as of the balance sheet date, with the resulting gains or losses included in the subsidiary's statement of income and, therefore, in our consolidated statements of income as a foreign exchange gain (loss).

From time to time we also enter into derivative financial instruments, such as foreign currency forward contracts, swaps and options, to limit our exposure to changes in foreign currency exchange rates with respect to our foreign currency denominated assets and liabilities and our local currency operating expenses. These derivative instruments are marked-to-market, with changes in their fair value recognized as a component of foreign exchange in our consolidated statements of income. We may also hedge other foreign currency exposures as management deems appropriate.

For the third quarter of 2009, the U.S. dollar weakened against most global currencies. In particular, the Brazilian real appreciated by 10% against the U.S. dollar for the third quarter of 2009 compared to a devaluation of the realby 17% against the U.S. dollar for the third quarter of 2008 and the Brazilian real appreciated by 31% against the U.S. dollar for the nine months ended September 30, 2009 compared to a devaluation of 7% against the U.S. dollar for the same period of 2008 . The appreciation of the Brazilian real in the third quarter of 2009 resulted in transaction gains primarily relating to the U.S. dollar-denominated financing of working capital in our Brazilian subsidiaries. These transaction gains and losses impact the comparison of our financial statements between periods.

The translation of functional currency costs and expenses at monthly average exchange rates also impacts the comparison of our financial statements between periods. During the third quarter of 2009 the Brazilian real was on average 12% weaker against the U.S. dollar compared to the third quarter of 2008. Similarly, during the nine-months ended September 30, 2009, the average real was on average 24% weaker against the U.S. dollar compared to the same period of 2008. The impact on our financial statements of the weaker real in both the quarter and nine months ended September 30, 2009 compared to the same respective periods of 2008 was a decrease in translated local currency costs and expenses.

Segment Overview

Agribusiness results were stronger in the third quarter of 2009 compared with the same period of 2008 as higher grain origination and oilseed processing results benefited from tight soybean supplies in Argentina due to earlier weather issues and strong demand from China. These improved results more than offset lower softseed processing results in Europe and Canada. Risk management strategies worked well during a volatile period. Volumes increased primarily as a result of increased sugar merchandising. Third quarter 2008 EBIT included a $60 million credit related to certain transactional taxes in Brazil that were accrued and paid in past years.

Fertilizer losses in the third quarter of 2009 were primarily driven by the continued mismatch between current low market prices for fertilizer products and high inventory costs. Volumes increased in the quarter relative to the same period last year as South American farmer purchasing patterns returned to a more traditional seasonal pattern of making fertilizer purchases close to the time they plant their crops. Additionally, we gained market share in certain regions in Brazil. Low margins were partially offset by $60 million of foreign exchange gains resulting from the strengthening of the Brazilian real on U.S. dollar-denominated financing of working capital. Noncontrolling interest decreased due to lower results at Fosfertil.

Edible oil results for the third quarter of 2009 improved from the same period last year in most regions of the world with Europe and North America showing the strongest improvement reflected in both margins and volumes.

Milling products' results for the third quarter of 2009 were negatively impacted by lower margins in wheat milling. These results were partially offset by higher volumes in corn milling compared with the third quarter of 2008.

Segment Results


A summary of certain items in our condensed consolidated statements of income
and volumes by reportable segment for the periods indicated is set forth below.



(US$ in millions,       Three Months Ended                  Nine Months Ended
except                    September 30,                       September 30,
volumes and
percentages)            2009         2008       Change      2009        2008       Change
Volumes (in
thousands of metric
tons):
Agribusiness            30,493       29,683          3%     91,723      86,501          6%
Fertilizer               3,814        3,082         24%      8,301       8,748        (5)%
Edible oil products      1,465        1,452          1%      4,241       4,281        (1)%
Milling products         1,071        1,004          7%      3,334       2,972         12%
Total                   36,843       35,221          5%    107,599     102,502          5%
Net sales:
Agribusiness          $  8,133     $ 10,152       (20)%   $ 23,070    $ 28,894       (20)%
Fertilizer               1,190        1,899       (37)%      2,730       4,875       (44)%
Edible oil products      1,572        2,232       (30)%      4,534       6,411       (29)%
Milling products           403          514       (22)%      1,156       1,451       (20)%
Total                 $ 11,298     $ 14,797       (24)%   $ 31,490    $ 41,631       (24)%
Cost of goods sold:
Agribusiness          $ (7,780)   $ (9,618)       (19)%   $(21,999)   $(27,151)      (19)%
Fertilizer              (1,352)     (1,356)          -%     (3,297)     (3,561)       (7)%
Edible oil products     (1,460)     (2,148)       (32)%     (4,260)     (6,105)      (30)%
Milling products          (363)       (466)       (22)%     (1,044)     (1,287)      (19)%
Total                 $(10,955)    $(13,588)      (19)%   $(30,600)   $(38,104)      (20)%
Gross profit:
Agribusiness           $   353      $   534       (34)%   $  1,071    $  1,743       (39)%
Fertilizer                (162)         543      (130)%       (567)      1,314      (143)%
Edible oil products        112           84         33%        274         306       (10)%
Milling products            40           48       (17)%        112         164       (32)%
Total                  $   343     $  1,209       (72)%    $   890    $  3,527       (75)%
Selling, general
and administrative
expenses:
Agribusiness          $   (163)    $   (174)       (6)%   $   (517)   $   (641)      (19)%
Fertilizer                 (76)         (78)       (3)%       (151)       (243)      (38)%
Edible oil products        (78)        (102)      (24)%       (211)       (278)      (24)%
Milling products           (32)         (28)        14%        (73)        (82)      (11)%
Total                 $   (349)    $   (382)       (9)%   $   (952)   $ (1,244)      (23)%
Foreign exchange
gains (losses):
Agribusiness           $   108     $   (192)               $   226    $    (33)
Fertilizer                  60         (270)                   246        (169)
Edible oil products          2           (9)                    (1)         (4)
Milling products            (1)           -                     (1)          -
Total                  $   169     $   (471)               $   470    $   (206)

(US$ in millions,        Three Months Ended                   Nine Months Ended
except                     September 30,                        September 30,
volumes and
percentages)             2009          2008       Change       2009        2008       Change
Equity in earnings
of affiliates:
Agribusiness          $      (1)    $       7      (114)%   $      (7)   $      9      (178)%
Fertilizer                    -             2      (100)%           1           6       (83)%
Edible oil products           -             4      (100)%          14           9         56%
Milling products              1             1          -%           3           3          -%
Total                 $       -     $      14      (100)%   $      11    $     27       (59)%
Noncontrolling
interest:
Agribusiness          $      (2)    $      (6)              $     (12)   $    (23)
Fertilizer                   54          (112)                     36        (294)
Edible oil products          (2)           (4)                     (6)         (7)
Milling products              -             -                       -           -
Total                 $      50     $    (122)              $      18    $   (324)
Other income
(expense):
Agribusiness          $      (1)    $       1               $      (1)   $    (20)
Fertilizer                   (3)           (1)                     (7)         (4)
Edible oil products           1            (2)                     (3)         10
Milling products             (1)            1                      (1)          1
Total                 $      (4)    $      (1)              $     (12)   $    (13)
Segment earnings
before interest and
tax:
Agribusiness          $     294     $     170         73%   $     760    $  1,035       (27)%
Fertilizer                 (127)           84      (251)%        (442)        610      (172)%
Edible oil products          35           (29)       221%          67          36         86%
Milling products              7            22       (68)%          40          86       (53)%
Total (1)             $     209     $     247       (15)%   $     425    $  1,767       (76)%
Depreciation,
depletion and
amortization:
Agribusiness          $     (50)    $     (48)         4%   $    (141)   $   (144)       (2)%
Fertilizer                  (40)          (44)       (9)%        (106)       (130)      (18)%
Edible oil products         (18)          (20)      (10)%         (52)        (56)       (7)%
Milling products            (11)           (5)       120%         (20)        (14)        43%
Total                 $    (119)    $    (117)         2%   $    (319)   $   (344)       (7)%

A reconciliation of total segment EBIT to net income attributable to Bunge follows:

                                         Three Months Ended
                                            September 30,               Nine Months Ended September 30,
(US$ in millions)                       2009             2008             2009                 2008
Reconciliation of total segment
earnings before interest and
tax:
Total segment earnings before
interest and tax                     $     209        $     247       $      425           $        1,767
Interest income                             20               57               96                      159
Interest expense                           (79 )            (97 )           (212 )                   (285 )
Income tax benefit (expense)                97               (5 )             52                     (459 )
Noncontrolling interest share of
interest and tax                           (15 )             32              (11 )                     92
Net income attributable to Bunge     $     232        $     234       $      350           $        1,274

Three Months Ended September 30, 2009 Compared to Three Months Ended September 30, 2008

Agribusiness Segment. Agribusiness segment net sales decreased 20% primarily due to lower market prices for agricultural commodities when compared to the historically high market prices experienced during most of the third quarter of 2008. Volumes increased 3% primarily as a result of higher volumes in sugar merchandising and grain origination in Brazil due to increased demand from China. These increases were partially offset by lower trading and distribution volumes, primarily in Europe as the third quarter of 2008 benefited from a strong import program due to supply disruptions.

Cost of goods sold decreased 19% primarily due to lower market prices when compared to the historically high market prices experienced during most of the third quarter of 2008 for agricultural commodities and energy. The reduction in cost of goods sold resulting from lower prices was partially offset by the impact of the stronger Brazilian realon the mark-to-market valuation of readily marketable commodity inventories at market prices linked to the U.S. dollar held by our Brazilian subsidiary.

Gross profit decreased 34% primarily due to the negative impact of the appreciation of the Brazilian real during the quarter compared with the third quarter of 2008, which was only partially offset by stronger grain origination margins.

SG&A expenses decreased 6% when compared to the same quarter of 2008 primarily due to lower bad debt expense, lower employee-related costs and the favorable impact of foreign exchange translation on local currency costs of our foreign subsidiaries when translated into U.S. dollars. SG&A expenses in the third quarter of 2008 included a $60 million credit related to certain transactional taxes in Brazil.

Foreign exchange gains of $108 million in the third quarter of 2009 related primarily to the impact of the real appreciation on U.S. dollar financing of working capital in Brazil, compared to losses of $192 million in the third quarter of 2008 when the Brazilian realdepreciated during the quarter. Foreign exchange gains in the third quarter of 2009 were substantially offset by foreign exchange losses included in gross profit as mentioned above resulting from the impact of the Brazilian real appreciation on the mark-to-market valuation of readily marketable commodity inventories at market prices linked to the U.S. dollar.

Equity in earnings of affiliates for the third quarter of 2009 was a net loss of $1 million as a result of losses in some of our North American and European biofuel joint ventures. These losses were partially offset by earnings in Solae, our soy specialty food ingredients joint venture with DuPont.

Noncontrolling interest decreased from the same period last year, primarily as a result of lower results in non-wholly owned subsidiaries in Brazil.

Segment EBIT increased $124 million from $170 million for the three months ended September 30, 2008, which included a

transactional tax credit of $60 million as discussed above, to $294 million for the three months ended September 30, 2009 largely due to improved margins in grain origination. The impact of foreign exchange gains largely offset the negative currency impact on lower gross profit resulting from the mark-to-market of U.S. dollar-linked readily marketable commodity inventories.

Fertilizer Segment. Fertilizer segment net sales decreased 37% in the third quarter of 2009 compared with the same period of last year due to lower selling prices for fertilizer products. Over the past year, fertilizer prices declined from the historically high fertilizer prices experienced in the third quarter of 2008. The decrease in sales resulting from lower prices was partially offset by an increase in volumes as farmer purchasing patterns returned to a more traditional seasonal sales pattern compared to 2008 when farmers accelerated purchases from the second half of the year into the first half of the year, as well as an increase in market share in certain regions of Brazil during the third quarter of 2009.

Cost of goods sold was largely unchanged when compared with the third quarter of 2008 as volume increases largely offset the impact of the decline in international fertilizer prices on inventory sold during the third quarter of 2009.

Gross profit decreased 130% as a result of lower margins due to the mismatch of declining sales prices and high cost inventories relative to sales prices in the third quarter of 2009 compared with rising international fertilizer prices during the third quarter of 2008 that more than offset the higher raw material input costs. Volume increases during the third quarter of 2009 relative to the same period last year partially offset the low margin sales.

SG&A expenses decreased 3% primarily as a result of lower employee related costs and by the favorable impact of the weaker Brazilian real on the translation of local currency expenses into U.S. dollars when compared with the same period of last year. These decreases were partially offset by higher bad debt provisions compared to the third quarter of 2008 primarily due to the bankruptcy of a customer during the period.

Foreign exchange gains of $60 million resulted from the Brazilian realappreciation during the third quarter of 2009 compared with losses of $270 million during the third quarter of 2008 when the Brazilian real depreciated. Some of the offsetting losses on fertilizer inventories have been recognized in the quarter as fertilizer inventories were sold.

Equity in earnings of affiliates netted to break-even in the third quarter of 2009 compared to a gain of $2 million in the third quarter of 2008 due to lower results from Fosbrasil, our Brazilian joint venture which produces purified phosphoric acid.

Noncontrolling interest decreased $166 million due to lower earnings at Fosfertil.

Segment EBIT decreased 251% primarily due to the mismatch of the high cost of inventories relative to sales prices in the third quarter of 2009, which more than offset higher volumes and the impact of exchange gains in the third quarter of 2009 compared to exchange losses in the third quarter of 2008.

Edible Oil Products Segment. Edible oil products segment net sales were 30% lower than the third quarter of 2008 mainly due to lower average selling prices driven by a decline in input costs, in particular crude vegetable oil prices. A 1% increase in volumes partially offset the price decreases.

Cost of goods sold decreased 32% primarily due to lower crude vegetable oil prices, which followed the lower prices of oilseeds and other commodities in the third quarter of 2009 compared with historically high prices in 2008. In addition, costs in the third quarter of 2009 were favorably impacted by foreign exchange translation effects at certain European subsidiaries compared with the third quarter of 2008.

Gross profit increased 33% as margins improved in North America and costs were favorably impacted by foreign exchange translation effects, primarily in Europe.

SG&A expenses decreased 24% due to the favorable impact of the foreign exchange translation of local currency expenses into U.S. dollars compared with the same period last year and lower employee related costs.

Foreign exchange gains were $2 million in the third quarter of 2009 compared to losses of $9 million in the third quarter of 2008, primarily due to the impact of the appreciation of the Brazilian real and several European currencies on the U.S. dollar- denominated financing of working capital compared to losses resulting from Brazilian realdevaluation in the third quarter of 2008.

Equity in earnings of affiliates was break-even for the third quarter of 2009 compared with a gain of $4 million in the same period of 2008 due to lower results in Saipol, our European joint venture engaged in the sale of branded bottled oils.

Noncontrolling interest decreased due to lower results in non-wholly owned subsidiaries in Poland.

Segment EBIT was a gain of $35 million in the third quarter of 2009 compared with a loss of $29 million in the third quarter of 2008. A combination of higher segment gross profit, lower SG&A expenses and foreign exchange gains accounted for the improvement in the results of the edible oil segment for the third quarter of 2009.

Milling Products Segment. Milling products segment net sales decreased 22% due to lower average selling prices of milled wheat, corn and related products primarily due to lower agricultural commodity prices. Increased competition in Brazilian wheat milling also pressured pricing in that business. The declines in prices more than offset a 7% increase in volumes, primarily in corn milling, during the third quarter of 2009.

Cost of goods sold decreased 22%, despite the 7% increase in volumes, primarily due to lower prices of corn and wheat raw materials. In addition, costs for the third quarter of 2009 were favorably impacted by the foreign exchange translation of Brazilian real expenses compared with the third quarter of 2008.

Gross profit decreased 17% as a result of lower net sales and increased competition in wheat milling.

SG&A expenses increased to $32 million in the third quarter of 2009 compared to $28 million in the third quarter of 2008 primarily due to additional expenses related to wheat milling in Brazil. This was partially offset by the favorable effect of the foreign exchange translation of Brazilian real-denominated expenses.

Segment EBIT in the third quarter of 2009 was $15 million lower than the third quarter of 2008 due to lower gross profit and higher SG&A expenses.

Interest. A summary of consolidated interest income and expense for the periods indicated follows:

                                         Three Months Ended
                                           September 30,
(US$ in millions, except percentages)     2009        2008     Change
Interest income                           $20         $57      (65)%
Interest expense                          (79)        (97)     (19)%

Interest income decreased 65% primarily due to lower interest rates and reductions in interest bearing balances. Interest expense decreased 19% in the three months ended September 30, 2009 from the comparable period in 2008 due to lower interest rates as well as reduced average borrowings resulting from lower working capital requirements.

Income Tax Expense. Income tax expense decreased $102 million to a benefit of $97 million in the three months ended September 30, 2009 from an expense of $5 million in the three months ended September 30, 2008. The effective tax rate for the three

months ended September 30, 2009 was a benefit of 97% compared to an expense of 2% for the same period of 2008. The decrease related primarily to the combination of losses in our Brazilian fertilizer operations altering the mix of earnings among jurisdictions and tax benefits of approximately $25 million primarily related to the reversal of a valuation allowance at a European subsidiary and the receipt of a favorable ruling in Brazil regarding an uncertain tax position.

Net Income Attributable to Bunge. Net income attributable to Bunge decreased $2 million to $232 million in the three months ended September 30, 2009 from $234 million in the three months ended September 30, 2008 due to higher results in the agribusiness and edible oils segments partially offset by losses in the fertilizer segment. In addition, net income attributable to Bunge for the third quarter of 2009 included tax benefits of approximately $25 million as discussed above. Net income attributable to Bunge for the three months ended September 30, 2008 included a $41 million after tax credit that related to certain transactional taxes in Brazil.

Nine Months Ended September 30, 2009 Compared to Nine Months Ended September 30, 2008

Agribusiness Segment. Agribusiness segment net sales decreased by 20% due to lower agricultural commodity prices compared to historically high market prices for most agricultural commodities and commodity products in our portfolio during the first nine months of 2008. Volumes increased 6% largely driven by higher grain origination volumes mainly in Europe, as well as increases in sugar merchandising and oilseed processing volumes primarily in Europe and Asia, reflecting our growth in these areas. These increases more than offset lower volumes in our oilseed distribution business.

Cost of goods sold decreased by 19% due to lower agricultural commodity prices and the favorable impact of the stronger U.S. dollar on foreign local currency costs of subsidiaries, primarily in Brazil, when translated into U.S. dollars. Cost of goods sold for the nine months ended September 30, 2008 included a $117 million credit resulting from a favorable ruling related to certain transactional taxes in Brazil.

Gross profit decreased by 39% for the nine months ended September 30, 2009 when compared to the nine months ended September 30, 2008. Excluding the 2008 transactional tax credit mentioned above, gross profit declined 34% primarily due to lower margins in our oilseed processing operations when compared with very strong margins, particularly in the first half of 2008.

SG&A decreased by 19% primarily due to lower employee variable compensation related costs, the beneficial impact of a stronger U.S. dollar on foreign local currency costs when translated into U.S. dollars and lower bad debt provisions. SG&A for the nine months ended September 30, 2008 included a bad debt provision of $31 million related to advances to farmers in Paraguay.

Foreign exchange gains of $226 million for the nine months ended September 30, 2009 compares with a foreign exchange loss of $33 million in the same period last year and was caused by the 31% appreciation of the Brazilian real during the nine months ended September 30, 2009 compared to a devaluation of 7% in the same period last year. Foreign exchange gains and losses are largely offset by inventory mark-to-market adjustments, which are included in cost of goods sold.

Equity in earnings of affiliates was a loss of $7 million in the nine months ended September 30, 2009, primarily due to weaker results in our biofuel joint ventures in Europe and North America. Equity in earnings of affiliates of $9 million in the first nine months of 2008 related primarily to strong results in . . .