BUNGE LIMITED

Table of Contents

		Page
PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

	Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2005 and 2004	2

	Condensed Consolidated Balance Sheets at March 31, 2005 and December 31, 2004	3

	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2005 and 2004	4

	Notes to the Condensed Consolidated Financial Statements	5

Cautionary Statement Regarding Forward-Looking Statements		16

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations		16

Item 3 – Quantitative and Qualitative Disclosures about Market Risk		24

Item 4 – Controls and Procedures		27

PART II – OTHER INFORMATION

Item 1 – Legal Proceedings		28

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds		28

Item 3 – Defaults Upon Senior Securities		28

Item 4 – Submission of Matters to a Vote of Security Holders		28

Item 5 – Other Information		28

Item 6 – Exhibits		28

Signatures		29

Exhibit Index		E-1

Item 1. Financial Statements

BUNGE LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(United States Dollars in Millions, except per share data)

	Three Months Ended March 31,
	2005			2004

Net sales	$	5,451		$	5,739
Cost of goods sold	(5,066		)	(5,374		)

Gross profit	385			365
Selling, general and administrative expenses	(196		)	(178		)
Interest income	23			16
Interest expense	(57		)	(52		)
Foreign exchange losses	(16		)	(16		)
Other income (expense)-net	18			11

Income from operations before income tax and minority interest	157			146
Income tax expense	(44		)	(58		)

Income from operations before minority interest	113			88
Minority interest	(15		)	(18		)

Net income	$	98		$	70

Earnings per common share – basic (Note 15):
Net income per share	$	0.88		$	0.70

Earnings per common share – diluted (Note 15):
Net income per share	$	0.82		$	0.65

The accompanying notes are an integral part of these condensed consolidated financial statements.

BUNGE LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(United States Dollars in Millions, except share data)

	March 31, 2005			December 31, 2004

ASSETS
Current assets:
Cash and cash equivalents	$	339		$	432
Trade accounts receivable (less allowance of $137 and $133)	1,799			1,928
Inventories (Note 3)	2,866			2,636
Deferred income taxes	106			95
Other current assets (Note 5)	1,660			1,577
Total current assets	6,770			6,668
Property, plant and equipment, net	2,550			2,536
Goodwill (Note 6)	166			167
Other intangible assets (Note 7)	170			156
Investments in affiliates	577			564
Deferred income taxes	260			273
Other non-current assets	557			543
Total assets	$	11,050		$	10,907

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:
Short-term debt	$	661		$	541
Current portion of long-term debt	144			140
Trade accounts payable	1,839			1,898
Deferred income taxes	38			38
Other current liabilities (Note 8)	1,170			1,285
Total current liabilities	3,852			3,902
Long-term debt	2,728			2,600
Deferred income taxes	221			232
Other non-current liabilities (Note 12)	541			518

Commitments and contingencies (Note 12)

Minority interest in subsidiaries	289			280

Shareholders’ equity:
Common shares, par value $.01; authorized – 240,000,000 shares; issued and outstanding: 2005 – 110,819,502 shares, 2004 – 110,671,450 shares	1			1
Additional paid-in capital	2,364			2,361
Retained earnings	1,524			1,440
Accumulated other comprehensive loss	(470		)	(427		)
Total shareholders’ equity	3,419			3,375
Total liabilities and shareholders’ equity	$	11,050		$	10,907

The accompanying notes are an integral part of these condensed consolidated financial statements.

BUNGE LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(United States Dollars in Millions)

	Three Months Ended March 31,
	2005			2004
OPERATING ACTIVITIES
Net income	$	98		$	70
Adjustments to reconcile net income to cash provided by (used for) operating activities:
Foreign exchange loss on debt	13			6
Bad debt expense	5			2
Depreciation, depletion and amortization	63			51
Reversal of allowance for recoverable taxes	(27		)	(9		)
Deferred income taxes	9			10
Minority interest	15			18
Changes in operating assets and liabilities, excluding the effects of acquisitions:
Trade accounts receivable	92			(96		)
Inventories	(267		)	(1,105		)
Prepaid commodity purchase contracts	(42		)	238
Advances to suppliers	40			(10		)
Trade accounts payable	(40		)	260
Accrued liabilities	(71		)	13
Other – net	(114		)	(168		)
Cash used for operating activities	(226		)	(720		)

INVESTING ACTIVITIES
Payments made for capital expenditures	(94		)	(52		)
Acquisitions of businesses and other intangible assets	(24		)	(3		)
Investments in related party loans	(6		)	—
Proceeds from disposal of property, plant and equipment	—			8
Cash used for investing activities	(124		)	(47		)

FINANCING ACTIVITIES
Net change in short-term debt	120			655
Proceeds from long-term debt	241			315
Repayment of long-term debt	(86		)	(160		)
Proceeds from sale of common shares	3			5
Dividends paid to shareholders	(14		)	(11		)
Dividends paid to minority interest	—			(1		)
Cash provided by financing activities	264			803
Effect of exchange rate changes on cash and cash equivalents	(7		)	(2		)

Net (decrease) increase in cash and cash equivalents	(93		)	34
Cash and cash equivalents, beginning of period	432			489
Cash and cash equivalents, end of period	$	339		$	523

The accompanying notes are an integral part of these condensed consolidated financial statements.

BUNGE LIMITED AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of Bunge Limited and its subsidiaries (Bunge) have been prepared in accordance with United States of America generally accepted accounting principles (U.S. GAAP) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended (Exchange Act). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included. The consolidated balance sheet at December 31, 2004 has been derived from Bunge’s audited financial statements at that date. Operating results for the three months ended March 31, 2005 are not necessarily indicative of the results to be expected for the year ending December 31, 2005. The financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2004 included in Bunge’s 2004 Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC).

Reclassifications – Certain reclassifications were made to the prior period condensed consolidated financial statements to conform to the current period presentation.

2. NEW ACCOUNTING STANDARDS

In March 2005, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 47 (FIN 47), Accounting for Conditional Assets Retirement Obligations an interpretation of FASB Statement No. 143. FIN 47 clarifies that an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the fair value of the liability can be reasonably estimated. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective December 31, 2005 for calendar year companies. Bunge is currently evaluating the FIN 47 to determine the impact on its consolidated financial statements.

In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment (SFAS No. 123R), that requires all share-based payments, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. At the time of its issuance, SFAS No. 123R was effective for the first interim or annual periods beginning July 1, 2005. In April 2005, the SEC issued an amendment to Rule 4-01(a) of Regulation S-X of the Exchange Act regarding the compliance date for SFAS No. 123R. The amendment requires companies to prepare financial statements in accordance with SFAS No. 123R beginning with the first interim or annual period of a company’s first fiscal year beginning on or after June 15, 2005, therefore, for companies with a calendar fiscal year end, the effective date is January 1, 2006. Bunge currently reports stock compensation based on Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees, (APB 25) with pro forma disclosures regarding fair value.

3. INVENTORIES

Inventories consist of the following:

(US$ in millions)	March 31, 2005		December 31, 2004
	(Unaudited)
Agribusiness - Readily marketable inventories at market value (1)	$	1,629	$	1,264
Fertilizer	544		522
Edible oils	300		489
Milling	57		58
Other (2)	336		303
Total	$	2,866	$	2,636

(1) Readily marketable inventories are agricultural commodities inventories that are readily convertible to cash because of their commodity characteristics, widely available markets and international pricing mechanisms.

(2) Other consists of agribusiness inventories, other than readily marketable inventories, carried at lower of cost or market.

4. BUSINESS ACQUISITIONS

Acquisition of Bunge Brasil Minority Interest — In the second half of 2004, Bunge acquired the remaining 17% of the outstanding capital stock of Bunge Brasil S.A. that it did not already own for $314 million in cash. The acquisition was funded with net proceeds of a public offering of Bunge’s common shares in June 2004. As a result of the acquisition, Bunge owns 100% of Bunge Brasil and its subsidiaries Bunge Alimentos S.A., Bunge’s Brazilian agribusiness and food products subsidiary, and Bunge Fertilizantes S.A., Bunge’s Brazilian fertilizer subsidiary. Bunge has been consolidating Bunge Alimentos and Bunge Fertilizantes since 1997. The acquisition was accounted for under the purchase method as a step acquisition of minority interest.

As a result of this transaction, Bunge recognized $137 million of long-lived assets and deferred tax liabilities. Bunge is evaluating the preliminary allocation of this amount, which it expects to complete in the second quarter of 2005.

Other Business Acquisitions — During the three months ended March 31, 2005, Bunge completed additional acquisitions having an aggregate purchase price of approximately $24 million of which approximately $20 million related to the purchase of a premium bottled oil brand from Molinos International, a subsidiary of Molinos Rio de la Plata S.A. The acquisition encompasses exclusive rights to the Ideal™ premium oil brand in Russia and the former Soviet Union countries. Bunge has assigned this brand to the edible oil products segment. Bunge did not recognize any goodwill on these transactions as of March 31, 2005.

5. OTHER CURRENT ASSETS

Other current assets consist of the following:

(US$ in millions)	March 31, 2005		December 31, 2004
	(Unaudited)
Prepaid commodity purchase contracts	$	82	$	37
Secured advances to suppliers	648		697
Unrealized gain on derivative contracts	260		310
Recoverable taxes	180		138
Marketable securities	13		14
Other	477		381
Total	$	1,660	$	1,577

6. GOODWILL

At March 31, 2005, the changes in the carrying value of goodwill by segment are as follows:

(US$ in millions)	Agribusiness			Edible Oil Products		Milling Products		Unallocated			Total

Balance, December 31, 2004 (1)	$	157		$	8	$	2	$	—		$	167
Reclassification from intangible assets	3			—		—		—			3
Foreign exchange translation	(1		)	—		—		—			(1		)
Tax benefit on goodwill amortization (2)	(3		)	—		—		—			(3		)
Balance, March 31, 2005	$	156		$	8	$	2	$		—	$	166

(1) Reflects the preliminary allocation of the excess of the cost to acquire the minority interest in Bunge Brasil over the historical book value (see Note 4 of the notes to the condensed consolidated financial statements).

(2) Bunge’s Brazilian subsidiary’s tax deductible goodwill is in excess of its book goodwill. For financial reporting purposes, the tax benefits attributable to the excess tax goodwill are first used to reduce goodwill and then intangible assets to zero, prior to recognizing any income tax benefit in the condensed consolidated statements of income.

7. OTHER INTANGIBLE ASSETS

Intangible assets consist of the following:

(US$ in millions)	March 31, 2005			December 31, 2004
	(Unaudited)
Trademark/brands-finite lived	$	105		$	87
Licenses	5			5
Other	14			18
	124			110
Less: Accumulated amortization:
Trademark/brands-finite lived	(3		)	(3		)
Licenses	(2		)	(2		)
Other	(1		)	(1		)
	(6		)	(6		)
Trademarks/brands-indefinite lived	40			40
Unamortized prior service costs of defined benefit plans	12			12
Intangible assets net of accumulated amortization	$	170		$	156

Bunge has assigned a 30 year life to the Ideal™ brand purchased in the first quarter of 2005 (see Note 4 of the notes to the condensed consolidated financial statements).

8. OTHER CURRENT LIABILITIES

Other current liabilities consist of the following:

(US$ in millions)	March 31, 2005		December 31, 2004
	(Unaudited)
Accrued liabilities	$	681	$	729
Unrealized loss on derivative contracts	299		242
Advances on sales	101		158
Other	89		156
Total	$	1,170	$	1,285

9. FINANCIAL INSTRUMENTS

The interest rate swaps used by Bunge as derivative hedging instruments have been recorded at fair value in other liabilities in the condensed consolidated balance sheet with changes in fair value recorded currently in earnings. Additionally, the carrying amount of the associated debt is adjusted through earnings for changes in the fair value due to changes in interest rates. Ineffectiveness, as defined in SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (SFAS No. 133), is recognized to the extent that these two adjustments do not offset. As of March 31, 2005, Bunge recognized no ineffectiveness related to its interest rate swap hedging instruments. The derivatives Bunge entered into for hedge purposes are assumed to be perfectly effective under the shortcut method of SFAS No. 133. The differential to be paid or received on changes in interest rates is recorded as an adjustment to interest expense. The interest rate swaps settle every six months until expiration.

The following table summarizes Bunge’s outstanding interest rate swap agreements accounted for as fair value hedges as of March 31, 2005.

	Maturity						Fair Value
(US$ in millions)	2008			2014			Total		March 31, 2005

Receive fixed/pay variable notional amount	$	500		$	500		$	1,000	$	(32	)
Weighted average variable rate payable (1)	4.12		%	4.09		%
Weighted average fixed rate receivable	4.375		%	5.35		%

(1) Interest is payable in arrears based on a forecasted rate of six-month LIBOR plus a spread.

Bunge recognized $1 million of accrued interest receivable as a reduction of interest expense in the three months ended March 31, 2005, in the condensed consolidated statements of income, relating to its outstanding swap agreements.

10. RELATED PARTY TRANSACTIONS

Bunge purchased soybeans, related soybean commodity products and other commodity products from its unconsolidated joint ventures (primarily Solae and its other North American joint ventures), which totaled $79 million and $45 million for the three months ended March 31, 2005 and 2004, respectively. Bunge also sold soybean commodity products and other commodity products to these joint ventures, which totaled $11 million and $6 million for the three months ended March 31, 2005 and 2004, respectively. Bunge believes these transactions are recorded at values similar to those with third parties.

In addition, Bunge sells soybean meal and fertilizer products to Seara Alimentos S.A. (Seara), a former subsidiary of Mutual Investment Limited engaged in the business of meat and poultry production. These sales were $2 million for both the three months ended March 31, 2005 and 2004. In the first quarter of 2005, Mutual Investment Limited sold Seara to a third party.

11. EMPLOYEE BENEFIT PLANS

	Pension Benefits Three Months Ended March 31,							Postretirement Benefits Three Months Ended March 31,
(US$ in millions)	2005				2004			2005		2004
	(Unaudited)
Service cost	$		2		$	2		$	—	$	—
Interest cost	4				4			—		—
Expected return on plan assets	(4			)	(4		)	—		—
Recognized net loss	1				1			—		—
Net periodic benefit cost (income)	$	3			$	3		$	—	$	—

Bunge expects to contribute approximately $11 million to its defined benefit pension plans and $2 million to its postretirement benefit plans during 2005. As of March 31, 2005, Bunge made contributions to the defined benefit pension plans totaling $2 million. As of March 31, 2005, Bunge made nominal payments to the postretirement benefit plans.

12. COMMITMENTS AND CONTINGENCIES

Bunge is party to a number of claims and lawsuits, primarily tax and labor claims in Brazil, arising out of the normal course of business. After taking into account liabilities recorded for all of the foregoing matters, management believes that the ultimate resolution of such matters will not have a material adverse effect on Bunge’s financial condition, results of operations or liquidity. Included in other non-current liabilities as of March 31, 2005 and December 31, 2004 are the following accrued liabilities:

(US$ in millions)	March 31, 2005		December 31, 2004
	(Unaudited)
Tax claims	$	172	$	153
Labor claims	107		112
Civil and other claims	64		78
Total	$	343	$	343

Tax Claims — The tax claims relate principally to claims against Bunge’s Brazilian subsidiaries, including income tax claims, value added tax claims (ICMS and IPI) and sales tax claims (PIS and COFINS). The determination of the manner in which various Brazilian federal, state and municipal taxes apply to Bunge’s operations is subject to varying interpretations arising from the complex nature of Brazilian tax law.

Labor Claims — The labor claims relate principally to labor claims against Bunge’s Brazilian subsidiaries. Court rulings under Brazilian laws have historically been in favor of the employee-plaintiff. The labor claims primarily relate to dismissals, severance, health and safety, salary adjustments and supplementary retirement benefits.

Civil and Other Claims — The civil and other claims primarily relate to various disputes with suppliers and customers.

Oleina Holding Arbitration — Bunge is involved in arbitration proceedings at the ICC International Court of Arbitration with the former joint venture partner of Cereol (which Bunge acquired in 2002) over the final purchase price of Oleina Holding S.A. and related issues. Cereol purchased the 49% of Oleina it did not already own from its joint venture partner for $27 million in February 2002, the final purchase price to be determined by arbitration.

In July 2004, the arbitration tribunal determined the purchase price to be approximately $108 million. Bunge filed a recourse for annulment of the arbitral award issued in July 2004 with the Federal Court of Lausanne, Switzerland. In January 2005, the recourse for annulment was denied by the federal court. Proceedings for enforcement of the arbitral award are currently pending in the Court of Appeal of the Hague in The Netherlands. Bunge is entitled to be indemnified by Edison SpA, from whom it purchased Cereol, for any portion of the final purchase price which exceeds $39 million. As of March 31, 2005, Bunge has recorded an obligation of $81 million to Cereol’s former joint venture partner and a receivable in the amount of $74 million from Edison relating to its indemnity. Edison has informed Bunge that it is currently evaluating whether the conditions precedent to this indemnification have been satisfied. Bunge has assessed the collectibility of this receivable under the terms of its agreement with Edison and believes this amount is fully collectible under the agreement.

Guarantees

Bunge has issued or was a party to the following guarantees at March 31, 2005:

(US$ in millions)	Maximum Potential Future Payments
Operating lease residual values (1)	$	69
Unconsolidated affiliates financing (2)	21
Customer financing (3)	173
Total	$	263

(1) Prior to January 1, 2003, Bunge entered into synthetic lease agreements for barges and railcars originally owned by Bunge and subsequently sold to third parties. The leases are classified as operating leases in accordance with SFAS No. 13, Accounting for Leases. Any gains on the sales were deferred and recognized ratably over the initial lease terms. Bunge has the option under each lease to purchase the barges or railcars at fixed amounts, based on estimated fair values or to sell the assets. If Bunge elects to sell, it will receive proceeds up to fixed amounts specified in the agreements. If the proceeds of such sales are less than the specified fixed amounts, Bunge would be obligated under a guarantee to pay supplemental rent for the deficiency in proceeds up to a maximum of approximately $69 million at March 31, 2005. The operating leases expire through 2007. There are no recourse provisions or collateral that would enable Bunge to recover any amounts paid under this guarantee.

(2) Prior to January 1, 2003, Bunge issued a guarantee to a financial institution related to debt of its joint ventures in Argentina, its unconsolidated affiliates. The term of the guarantee is equal to the term of the related financing, which matures in 2009. There are no recourse provisions or collateral that would enable Bunge to recover any amounts paid under this guarantee.

(3) Bunge issued guarantees to a financial institution in Brazil related to amounts owed the institution by certain of its customers. The terms of the guarantees are equal to the terms of the related financing arrangements, which can be as short as 120 days or as long as 360 days. In the event that the customers default on their payments to the institutions and Bunge would be required to perform under the guarantees, Bunge has obtained collateral from the customers. At March 31, 2005, $65 million of these financing arrangements were collateralized by tangible property. Bunge has determined the fair value of these guarantees to be immaterial at March 31, 2005.

In addition, Bunge has provided parent level guarantees of the indebtedness outstanding under certain senior credit facilities and senior notes, which were entered into by its wholly owned subsidiaries. The debt under these guarantees had a carrying amount of $2,514 million at March 31, 2005. Debt related to these guarantees is included in the condensed consolidated balance sheet at March 31, 2005. There are no significant restrictions on the ability of any of Bunge’s subsidiaries to transfer funds to Bunge.

Also, certain of Bunge’s subsidiaries have provided guarantees of indebtedness of certain of their subsidiaries under certain lines of credit with various institutions. The total borrowing capacity under these lines of credit was $321 million as of March 31, 2005, of which there was no related amount outstanding as of such date.

13. COMPREHENSIVE INCOME (LOSS)

The following table summarizes the components of comprehensive income (loss):

	Three Months Ended March 31,
(US$ in millions)	2005			2004
	(Unaudited)
Net income	$	98		$	70
Other comprehensive income (loss):
Foreign exchange translation adjustment, net of tax (expense) benefit $0 (2005), $0 (2004)	(45		)	(27		)
Unrealized gains (losses) on commodity futures designated as cash flow hedges, net of tax (expense) benefit of $(2) (2005), $(2) (2004)	4			4
Reclassification of realized (gains) losses to net income, net of tax (expense) benefit of $(1) (2005), $4 (2004)	(2		)	8
Total comprehensive income (loss)	$	55		$	55

14. STOCK-BASED COMPENSATION

Bunge has an employee equity incentive plan and a non-employee directors’ equity incentive plan. Awards under the employee equity incentive plan may be in the form of stock options, restricted stock units (including performance-based and regular time-vested restricted stock units) or other awards. The non-employee directors’ equity incentive plan provides for awards of stock options to Bunge’s non-employee directors. To date, Bunge has granted stock options, performance-based restricted stock unit awards and regular time-vested restricted stock unit awards under its employee equity incentive plan and stock options under its non-employee directors’ plan. Under these equity incentive plans, during the three months ended March 31, 2005, Bunge issued 148,052 common shares upon the exercise of stock options and, pursuant to an election made by participants, paid out 114,000 vested performance-based restricted stock units in cash, rather than common shares.

In accordance with the provisions of SFAS No. 123, Accounting for Stock-Based Compensation (SFAS No. 123), Bunge has elected to continue to account for stock-based compensation using the intrinsic value method under APB 25 and FASB Interpretation No. 28, Accounting for Stock Appreciation Rights and Other Variable Stock Option or Award Plans (FIN 28).

In accordance with APB 25, Bunge accrues costs for its restricted stock awards granted over the vesting or performance period and adjusts costs related to its performance-based restricted stock unit awards for subsequent changes in the fair market value of the awards. There is no compensation cost recorded for stock options granted under either plan, since the exercise price is equal to the fair market value of the underlying common shares on the date of grant. Bunge recognized compensation expense of approximately $4 million for the three months ended March 31, 2005, related to its restricted stock unit awards.

In accordance with SFAS No. 123, Bunge discloses the pro forma effect of accounting for stock-based awards under the fair value method. The following table sets forth pro forma information as if Bunge had applied the fair value recognition provisions of SFAS No. 123 to stock options granted to determine its stock-based compensation cost.

	Three Months Ended March 31,
(US$ in millions, except per share data)	2005			2004
	(Unaudited)

Net income, as reported	$	98		$	70
Deduct: Total stock-based compensation expense determined under fair value based method for stock awards granted, net of related tax effects	(2		)	(2		)
Pro forma net income	$	96		$	68

Earnings per common share:
Basic- as reported	$	.88		$	.70
Basic- pro forma	$	.87		$	.68

Diluted- as reported (1)	$	.82		$	.65
Diluted- pro forma (1)	$	.80		$	.63

(1) The numerator for the calculation of diluted as reported and pro forma earnings per share in the three months ended March 31, 2005 and 2004 was adjusted by $1 million, for interest expense related to the convertible notes (see Note 15).

15. EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding, excluding any dilutive effects of stock options, restricted stock unit awards and convertible notes during the reporting period. Diluted earnings per share is computed similar to basic earnings per share, except that the weighted average number of common shares outstanding is increased to include additional shares from the assumed exercise of stock options, restricted stock unit awards and convertible notes, if dilutive. The number of additional shares is calculated by assuming that outstanding stock options were exercised and that the proceeds from such exercises were used to acquire common shares at the average market price during the reporting period. In addition, Bunge accounts for the effect of its $250 million aggregate principal amount of 3.75% convertible notes due 2022 (convertible notes) on its diluted earnings per share computation using the if-converted method. Under this method, the convertible notes are assumed to be converted and the interest expense, net of tax related to the convertible notes is added back to earnings.

The computation of diluted earnings per common share for the three months ended March 31, 2005 and 2004 include the weighted average common shares that would be issuable upon conversion of Bunge’s convertible notes. The convertible notes are convertible into Bunge’s common shares at the option of a holder, among other circumstances, during any calendar quarter in which the closing price of Bunge’s common shares for at least 20 trading days of the last 30 trading days of the immediately preceding calendar quarter is more than 120% of the conversion price of $32.1402 or approximately $38.57 per share. The initial conversion rate is 31.1137 common shares of Bunge Limited for each $1,000 principal amount of convertible notes converted.

The following table sets forth the computation of basic and diluted earnings per share for the three months ended March 31, 2005 and 2004.

	Three Months Ended March 31,
(US$ in millions, except for share data)	2005		2004
	(Unaudited)
Net income - basic	$	98	$	70
Interest on convertible notes, net of tax	1		1
Net income - diluted	$	99	$	71

Weighted average number of common shares outstanding:
Basic	110,752,441		100,016,833
Effect of dilutive shares:
-Stock options and awards	2,108,243		1,770,441
-Convertible notes	7,777,462		7,778,425
Diluted	120,638,146		109,565,699
Net income per share:
Basic	$	.88	$	.70
Diluted	$	.82	$	.65

Operating Segment Information

(US$ in millions)	Agribusiness			Fertilizer			Edible Oil Products			Milling Products			Other		Unallocated			Total
	(Unaudited)
Three months ended March 31, 2005
Net sales to external customers	$	4,075		$	403		$	779		$	194		$	—	$	—		$	5,451
Intersegment revenues	525			—			6			6			—		(537		)	—
Gross profit	226			70			64			25			—		—			385
Foreign exchange gain (loss)	4			(17		)	(1		)	—			—		(2		)	(16		)
Interest income	4			13			1			—			—		5			23
Interest expense	(30		)	(14		)	(8		)	(2		)	—		(3		)	(57		)
Segment operating profit	107			9			11			12			—		—			139
Depreciation, depletion and amortization	$	(25	)	$	(23	)	$	(12	)	$	(3	)	$	—	$	—		$	(63	)

Three months ended March 31, 2004
Net sales to external customers	$	4,266		$	366		$	907		$	200		$	—	$	—		$	5,739
Intersegment revenues	273			—			8			5			—		(286		)	—
Gross profit	212			85			50			18			—		—			365
Foreign exchange gain (loss)	(5		)	(11		)	—			—			—		—			(16		)
Interest income	2			9			3			1			—		1			16
Interest expense	(31		)	(11		)	(6		)	(2		)	—		(2		)	(52		)
Segment operating profit	78			41			11			6			—		—			136
Depreciation, depletion and amortization	$	(21	)	$	(17	)	$	(10	)	$	(3	)	$	—	$	—		$	(51	)

A reconciliation of income from operations before income tax and minority interest to total segment operating profit follows:

	Three Months Ended March 31,
(US$ millions)	2005		2004
	(Unaudited)
Income from operations before income tax and minority interest	$ 157		$ 146
Unallocated expenses – net (1)	(18	)	(10	)
Total segment operating profit	$ 139		$ 136

(1) Includes interest income, interest expense, foreign exchange gains and losses and other income and expense not directly attributable to Bunge’s operating segments.

Cautionary Statement Regarding Forward-Looking Statements

This report contains both historical and forward-looking statements. All statements, other than statements of historical fact are, or may be deemed to be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act). These forward-looking statements are not based on historical facts, but rather reflect our current expectations and projections about our future results, performance, prospects and opportunities. We have tried to identify these forward-looking statements by using words including “may,” “will,” “expect,” “anticipate,” “believe,” “intend,” “estimate,” “continue” and similar expressions. These forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or implied by, these forward-looking statements. The following important factors, among others, could affect our business and financial performance: governmental policies affecting our business, including agricultural and trade policies and laws governing environmental liabilities; our funding needs and financing sources; the effects of economic, political or social conditions and changes in foreign exchange policy or rates; the outcome of pending regulatory and legal proceedings; our ability to complete, integrate and benefit from acquisitions, divestitures, joint ventures and strategic alliances; estimated demand for the commodities and other products that we sell and use in our business; industry conditions, including the cyclicality of the agribusiness industry and unpredictability of the weather; agricultural, economic, social and political conditions in the primary markets where we operate; and other economic, business, competitive and/or regulatory factors affecting our business generally.

The forward-looking statements included in this report are made only as of the date of this report, and except as otherwise required by federal securities law, we do not have any obligation to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.

You should refer to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2004, filed with the SEC on March 16, 2005, for a more detailed discussion of these factors.

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Events Affecting Operating Results

First Quarter 2005 Overview

Our agribusiness results for the first quarter of 2005 were higher than last year as a result of volume growth as customer demand responded strongly to lower prices for agricultural commodities as compared to last year’s high prices. The first quarter of the calendar year represents the end of the peak of oilseed processing activity in North America and Europe as supplies of available crops that were harvested during August, September and October of the previous year are processed and sold. In addition, there is also reduced oilseed processing activity in South America as the first quarter is typically the beginning of that region’s harvest season. However, a large supply of soybeans resulting from increased farmer selling in response to a late quarter price rally due to reduced soy production prospects in Brazil, benefited our oilseed processing margins and oilseed processing capacity utilization in North America, South America and Europe during the quarter. Despite lower than expected Brazilian soy production, the USDA has estimated the 2004/2005 total world oilseed crop at 383 million tons, representing a 14% increase over last year’s world oilseed crop. The 2004/2005 world soybean crop is estimated to increase 16% over last year’s world soybean crop to an estimated 219 million tons. The large crops and increased farmer selling have given us ample supplies to serve our customers.

Our fertilizer segment results for the first quarter of 2005 decreased from last year’s results due to an overall decline in fertilizer volumes, the effects of a stronger Brazilian real, higher industrial and depreciation expenses and higher foreign exchange hedging costs.

In our edible oil products segment, our sales volumes increased compared to the first quarter of 2004 primarily due to lower selling prices which stimulated customer demand in all regions. A more profitable product mix and lower raw material costs, principally agricultural commodities, benefited gross profit. However, increases in advertising and promotional expenses resulted in flat segment operating profit.

Segment Results

In the first quarter of 2005, we reclassified certain agribusiness product lines from the edible oils products segment to the agribusiness segment. As a result, amounts for the three months ended March 31, 2004 have been reclassified to conform to the current period presentation.

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

	Three Months Ended March 31,						Percent
(US$ in millions, except percentages)	2005			2004			Change

Volumes (in thousands of metric tons):
Agribusiness	23,020			20,024			15	%
Fertilizer	1,729			1,760			(2	)%
Edible oil products	1,149			1,043			10	%
Milling products	985			966			2	%
Total	26,883			23,793			13	%

Net sales:
Agribusiness	$	4,075		$	4,266		(4	)%
Fertilizer	403			366			10	%
Edible oil products	779			907			(14	)%
Milling products	194			200			(3	)%
Total	$	5,451		$	5,739		(5	)%

Costs of goods sold:
Agribusiness	$	(3,849	)	$	(4,054	)	(5	)%
Fertilizer	(333		)	(281		)	19	%
Edible oil products	(715		)	(857		)	(17	)%
Milling products	(169		)	(182		)	(7	)%
Total	$	(5,066	)	$	(5,374	)	(6	)%

Gross profit:
Agribusiness	$	226		$	212		7	%
Fertilizer	70			85			(18	)%
Edible oil products	64			50			28	%
Milling products	25			18			39	%
Total	$	385		$	365		5	%

	Three Months Ended March 31,						Percent
(US$ in millions, except percentages)	2005			2004			Change

Selling, general and administrative expenses:
Agribusiness	$	(97	)	$	(100	)	(3	)%
Fertilizer	(43		)	(31		)	39	%
Edible oil products	(45		)	(36		)	25	%
Milling products	(11		)	(11		)	—	%
Total	$	(196	)	$	(178	)	10	%

Foreign exchange gain (loss):
Agribusiness	$	4		$	(5	)
Fertilizer	(17		)	(11		)
Edible oil products	(1		)	—
Milling products	—			—
Total	$	(14	)	$	(16	)

Interest income:
Agribusiness	$	4		$	2		100	%
Fertilizer	13			9			44	%
Edible oil products	1			3			(67	)%
Milling products	—			1			(100	)%
Total	$	18		$	15		20	%

Interest expense:
Agribusiness	$	(30	)	$	(31	)	(3	)%
Fertilizer	(14		)	(11		)	27	%
Edible oil products	(8		)	(6		)	33	%
Milling products	(2		)	(2		)	—	%
Total	$	(54	)	$	(50	)	8	%

Segment operating profit:
Agribusiness	$	107		$	78		37	%
Fertilizer	9			41			(78	)%
Edible oil products	11			11			—	%
Milling products	12			6			100	%
Total (1)	$	139		$	136		2	%

Depreciation, depletion and amortization:
Agribusiness	$	25		$	21		19	%
Fertilizer	23			17			35	%
Edible oil products	12			10			20	%
Milling products	3			3			—	%
Total	$	63		$	51		24	%

Net Income	$	98		$	70		40	%

(1) Total segment operating profit is our consolidated income from operations before income tax and minority interest that includes an allocated portion of the foreign exchange gains and losses relating to debt financing operating working capital, including readily marketable inventories. Also included in total segment operating profit is an allocation of interest income and interest expense attributable to the financing of operating working capital.

Total segment operating profit is a non-GAAP measure and is not intended to replace income from operations before income tax and minority interest, the most directly comparable GAAP measure. Total segment operating profit is a key performance measurement used by our management to evaluate whether our operating activities cover the financing costs of our business. We believe total segment operating profit is a more complete measure of our operating profitability, since it allocates foreign exchange gains and losses and the cost of debt financing working capital to the appropriate operating segments. Additionally, we believe total segment operating profit assists investors by allowing them to evaluate changes in the operating results of our portfolio of businesses before non-operating factors that affect net income. Total segment operating profit is not a measure of consolidated operating results under GAAP and should not be considered as an alternative to income from operations before income tax and minority interest or any other measure of consolidated operating results under GAAP.

Below is a reconciliation of income from operations before income tax and minority interest to total segment operating profit.

	Three Months Ended March 31,
(US$ in millions)	2005			2004
Income from operations before income tax and minority interest	$	157		$	146
Unallocated (income) expense—net(1)	(18		)	(10		)
Total segment operating profit	$	139		$	136

(1) Includes interest income, interest expense, foreign exchange gains and losses and other income and expense not directly attributable to our operating segments.

Three Months Ended March 31, 2005 Compared to Three Months Ended March 31, 2004

Agribusiness Segment. Agribusiness segment net sales decreased 4% due to lower average selling prices for agricultural commodity products, but the lower selling prices were partially offset by a 15% increase in volumes. The decrease in average selling prices was primarily due to increased global production of grains and oilseeds. Agribusiness volumes increased as customers responded to lower prices for agricultural commodities compared to last year’s high prices. A late-quarter rally in the prices of agricultural commodity products due to reduced Brazilian soy production expectations triggered farmer selling, particularly in Argentina and North America, which increased volumes and capacity utilization in North and South America and Europe.

Cost of goods sold decreased 5% primarily due to lower raw material costs. Included in cost of goods sold in the first quarter of 2005 was a $27 million decrease in our remaining balance of the allowance for recoverable taxes in Argentina primarily as a result of payments being received without delays and the significant improvement in the Argentine government’s financial condition. The first quarter of 2004 included a $9 million decrease in our allowance for recoverable taxes as a result of either cash received by us or compensation against taxes owed by us to the Argentine government.

Gross profit increased 7% primarily due to the increase in volumes, the decrease in the balance of our allowance for recoverable taxes in Argentina and higher margins on ocean freight. As a result of the ample supply of oilseeds, volumes processed at most of our oilseed processing facilities increased compared to last year. However, lower gross profit margins in Hungary and Poland compared to last year’s very high levels, and start-up costs related to the commencement of grain origination activities in Ukraine and Russia, also negatively affected gross profit.

Selling, general and administrative expenses (SG&A) decreased 3% primarily due to lower compensation expense.

Segment operating profit increased 37% primarily due to the higher volumes, decreases in the balance of our allowance for recoverable taxes and lower SG&A and financial costs.

Fertilizer Segment. Fertilizer segment net sales increased 10% due to higher average selling prices. Selling prices benefited from higher international selling prices for imported fertilizers and raw materials, which helped boost local prices as products are priced to import parity. Overall fertilizer sales volumes decreased 2% in the first quarter of 2005 compared to the same quarter of 2004. Retail fertilizer volumes declined primarily due to lower

corn prices that reduced Brazilian planting intentions for the winter corn crop and credit constraints in southern Brazil related to the drought. However, nutrient fertilizer volumes benefited from increased demand for nitrogen-based fertilizer as Brazilian farmers responded to favorable prices for coffee and sugar cane to increase their plantings of these crops.

Cost of goods sold increased 19% due to higher imported raw material costs, higher industrial and depreciation expenses attributable to new mixing, granulation and acidulation units that commenced production after the first quarter of 2004 and higher costs associated with the effects of a stronger Brazilian real in the first quarter of 2005 compared to first quarter of 2004. Gross profit decreased by 18% primarily due to the increase in raw material costs and industrial and depreciation expenses.

SG&A increased 39% due primarily to higher bad debt expense and due to the effects of a stronger Brazilian real in the first quarter of 2005 compared to first quarter of 2004.

Segment operating profit decreased 78% primarily due to the decrease in gross profit and increases in SG&A and foreign exchange losses. The increase in foreign exchange losses was primarily due to increased foreign exchange hedging expenses resulting from an increase in U.S.-dollar denominated debt funding our increased working capital.

Edible Oil Products Segment. Edible oil products segment net sales decreased 14% primarily due to lower average selling prices caused by a decrease in raw material costs. The decrease in net sales was partially offset by a 10% increase in volume. The lower selling prices helped stimulate customer demand, which increased our volumes in all regions.

Cost of goods sold decreased 17% primarily due to lower raw material costs. Gross profit increased 28% primarily due to the increase in sales volumes, lower raw material costs and a more profitable product mix in most locations.

SG&A increased 25% primarily due to the effects of a stronger Brazilian real and euro in the first quarter of 2005 compared to the first quarter of 2004 and increases in advertising and promotional expenses particularly in Brazil.

Segment operating profit was flat primarily as the increase in gross profit was offset by increases in SG&A and an increase in foreign exchange hedging costs in Eastern Europe and higher interest expense on working capital.

Milling Products Segment. Milling products segment net sales decreased 3% primarily due to lower average selling prices for wheat and corn milling products, partially offset by increases in wheat milling volumes. Average selling prices declined primarily due to lower raw material costs. Wheat milling sales volumes benefited from accelerated purchases by customers in anticipation of rising international wheat prices. The increase in wheat milling volumes were offset by decreases in corn milling sales volumes due to lower sales to the U.S. government food aid program.

Cost of goods sold decreased 7% due to lower raw material costs and lower corn milling product volumes. Gross profit increased 39% primarily due to the increase in wheat milling sales volumes, lower raw material costs and a more profitable mix of products sold. In addition, wheat milling products gross profit benefited from productivity enhancements as a result of measures taken to improve our asset footprint and operating efficiencies.

Segment operating profit increased 100% as a result of the improvement in gross profit.

Consolidated Financial Costs. A summary of consolidated financial costs for the periods indicated follows:

	Three Months Ended March 31,
(US$ in millions, except percentages)	2005			2004			Change

Interest income	$	23		$	16		44	%
Interest expense	(57		)	(52		)	10	%
Foreign exchange losses	(16		)	(16		)

Interest income increased 44% due to higher average balances of interest bearing accounts receivable. Interest expense increased 10% despite lower average borrowings for the first quarter of 2005 compared to the first quarter of 2004 primarily due to higher average interest rates on short-term borrowings.

Foreign exchange losses of $16 million included hedging costs related to our monetary exposure in Brazil and exchange losses on our Brazilian U.S. dollar net monetary liability position primarily due to the 1% devaluation in the value of the Brazilian real in the first quarter of 2005 and 2004 against the U.S. dollar.

Other Income (Expense) – net. Other income (expense) – net increased $7 million to $18 million in the first quarter of 2005 from $11 million in the first quarter of 2004 primarily due to higher earnings from Bunge’s French oilseed processing and German biodiesel joint ventures. The first quarter of 2004 included a pretax gain of $5 million from the exchange of our Brazilian retail flour assets for the industrial flour assets of J. Macêdo S.A.

Income Tax Expense. Income tax expense decreased $14 million to $44 million in the first quarter of 2005 from $58 million in the first quarter of 2004. Our effective tax rate for the first quarter of 2005 decreased to 28%, compared to 32% in fiscal 2004. The decrease in our effective tax rate was primarily due to higher earnings in lower tax jurisdictions.

Minority Interest. Minority interest expense decreased $3 million to $15 million in the first quarter of 2005 from $18 million in the first quarter of 2004 primarily due to our acquisition in the third and fourth quarter of 2004 of the remaining 17% minority interest of Bunge Brasil S.A. Bunge now owns 100% of Bunge Brasil.

Net Income. Net income increased $28 million to $98 million in the first quarter of 2005 from $70 million in the first quarter of 2004. Net income for the first quarter of 2005 includes the reversal of valuation allowances on recoverable taxes of $19 million, net of tax. Net income for the first quarter of 2004 includes the reversal of valuation allowances on recoverable taxes of $6 million, net of tax, and the $3 million gain, net of tax, from the exchange of our Brazilian retail flour assets.

Liquidity and Capital Resources

Our primary financial objective is to maintain sufficient liquidity through a conservative balance sheet that provides flexibility to pursue our growth objectives. Our current ratio, defined as current assets divided by current liabilities, was 1.76 at March 31, 2005 and 1.71 at December 31, 2004.

Cash and Readily Marketable Inventories. Cash and cash equivalents were $339 million at March 31, 2005 and $432 million at December 31, 2004.

Included in our inventories were readily marketable inventories of $1,629 million at March 31, 2005 and $1,264 million at December 31, 2004. Readily marketable inventories are agricultural commodity inventories, financed primarily with debt, which are readily convertible to cash because of their commodity characteristics, widely available markets and international pricing mechanisms. The increase in readily marketable inventories was primarily due to acquisitions of inventories in South America as the 2005 crop harvest began in the first quarter of 2005.

Secured Advances to Suppliers and Prepaid Commodity Contracts. We provide financing services to farmers in Brazil from whom we purchase soybeans through prepaid commodity purchase contracts and advances to farmers. These arrangements are typically secured by the farmer’s crop and mortgages on the farmer’s land and other assets and are typically settled through the delivery of the related crop to us upon harvest. In addition, the arrangements for advances to farmers carry a prevailing market interest rate. At March 31, 2005, we had $941 million in prepaid commodity purchase contracts and advances to farmers compared to $932 million at December 31, 2004. Against these outstanding balances, we also had accounts payables reflecting soybeans which had been delivered by these farmers to our facilities with a value of $216 million as of March 31, 2005 and $38 million as of December 31, 2004. The allowance for uncollectible advances totaled $42 million at March 31, 2005 and $43 million at December 31, 2004. We closely monitor the collectibility of these accounts.

Long-Term and Short-Term Debt. We conduct most of our financing activities through a centralized financing structure, designed to act as our central treasury, which enables us and our subsidiaries to borrow long-term and short-term debt more efficiently. This structure includes a master trust facility, the primary assets of which consist of intercompany loans made to Bunge Limited and its subsidiaries. Bunge Limited’s wholly owned financing subsidiaries fund the master trust with long and short-term debt obtained from third parties, including through our commercial paper program.

To finance working capital, we use cash flows generated from operations and short-term borrowings, including our commercial paper program, and various long-term bank facilities and bank credit lines, which are

sufficient to meet our business needs. At March 31, 2005, we had approximately $1,900 million of committed borrowing capacity under our commercial paper program, other short-term lines of credit and long-term credit facilities, all of which are with a number of lending institutions. Of this committed capacity, $1,167 million was unused and available at March 31, 2005.

At March 31, 2005, we had $493 million outstanding under our commercial paper program. Our commercial paper program is our least expensive available short-term funding source. We maintain back-up bank credit lines, which expire in June 2007, equal to the maximum capacity of our commercial paper program of $600 million. If we were unable to access the commercial paper market, we would use these bank credit lines, which would be at a higher cost than our commercial paper. At March 31, 2005, no amounts were outstanding under these back-up bank credit lines.

Our short-term and long-term debt increased by $252 million at March 31, 2005 from December 31, 2004 primarily due to the acquisition of inventories in South America.

Through our subsidiaries, we have various other long-term debt facilities at fixed and variable interest rates denominated in both U.S. dollars and Brazilian reais, most of which mature between 2005 and 2008. At March 31, 2005, we had $349 million outstanding under these long-term debt facilities. Of this amount, at March 31, 2005, $178 million was secured by certain land, property, plant and equipment and investments in our consolidated subsidiaries, having a net carrying value of $633 million.

Our credit facilities and certain senior notes require us to comply with specified financial covenants related to minimum net worth, working capital and a maximum debt to capitalization ratio. We were in compliance with these covenants as of March 31, 2005.

In September 2004, we entered into interest rate swap agreements maturing in 2008 and 2014 for the purpose of managing our interest rate exposure on a portion of our fixed rate debt. Under the terms of the interest rate swaps, we make payments based on six-month LIBOR in arrears, and we will receive fixed interest rates based on our $500 million aggregate principal amount 5.35% senior notes due 2014 and our $500 million aggregate principal amount 4.375% senior notes due 2008. The interest rate swaps settle every six months until expiration. Accrued interest receivable of $1 million relating to these swaps was recorded as a reduction to interest expense in the three months ended March 31, 2005 in the condensed consolidated statements of income.

Shareholders’ Equity. Shareholders’ equity increased to $3,419 million at March 31, 2005 from $3,375 million at December 31, 2004 as a result of the net income of $98 million and $3 million attributable to the issuance of our common shares upon the exercise of employee stock options. This increase was partially offset by dividends paid to shareholders of $14 million and other comprehensive losses of $43 million, which includes foreign exchange losses of $45 million.

Cash Flows

In the three months ended March 31, 2005, our cash and cash equivalents balance decreased $93 million, reflecting the net impact of cash flows from operating, investing and financing activities, compared to a $34 million increase in our cash and cash equivalents balance in the three months ended March 31, 2004.

Our operating activities used cash of $226 million in the three months ended March 31, 2005, compared to cash used of $720 million in the three months ended March 31, 2004. Our cash flow from operations varies depending on the timing of the acquisition of, and the market prices for, agribusiness commodity inventories. Historically, our operating activities use cash in the first quarter of the year as we are beginning our purchase of the South American harvest, which typically begins in March. Our cash flow used by operating activities declined in the first quarter of 2005 compared to the same period in 2004 primarily due to lower commodity prices which reduced our working capital requirements.

Cash used by investing activities was $124 million in the three months ended March 31, 2005, compared to cash used of $47 million in the three months ended March 31, 2004. Payments made for capital expenditures included investments in property, plant and equipment that totaled $94 million and consisted primarily of additions under our normal capital expenditure plan. Maintenance capital expenditures were $13 million in the three months ended March 31, 2005, compared to $20 million in the three months ended March 31, 2004. Maintenance capital expenditures are expenditures made to replace existing equipment in order to maintain current production capacity. The majority of non-maintenance capital expenditures in the three months ended March 31, 2005 related to efficiency improvements to reduce costs, equipment upgrades and business expansion. In addition, acquisitions of businesses and other intangible assets were $24 million, which included $20

million for the Ideal™ premium bottled oil brand in Russia and the former Soviet Union countries. Also included in cash flow from investing activities in the three months ended March 31, 2004 was $7 million received in connection with the exchange of our Brazilian retail flour assets for the industrial flour assets of J. Macêdo.

Cash provided by financing activities was $264 million in the three months ended March 31, 2005, compared to cash provided of $803 million in the three months ended March 31, 2004. In the three months ended March 31, 2005 and 2004, we increased our borrowings of short and long-term debt primarily to finance our additional working capital requirements. Dividends paid to our shareholders in the three months ended March 31, 2005 were $14 million and were $11 million in the three months ended March 31, 2004.

Guarantees

We have issued or were a party to the following guarantees at March 31, 2005:

(US$ in millions)	Maximum Potential Future Payments
Operating lease residual values (1)	$	69
Unconsolidated affiliates financing (2)	21
Customer financing (3)	173
Total	$	263

(1) Prior to January 1, 2003, we entered into synthetic lease agreements for barges and railcars originally owned by us and subsequently sold to third parties. The leases are classified as operating leases in accordance with SFAS No. 13, Accounting for Leases. Any gains on the sales were deferred and recognized ratably over the initial lease terms. We have the option under each lease to purchase the barges or railcars at fixed amounts based on estimated fair values or to sell the assets. If we elect to sell, we will receive proceeds up to fixed amounts specified in the agreements. If the proceeds of such sales are less than the specified fixed amounts, we would be obligated under a guarantee to pay supplemental rent for the deficiency in proceeds up to a maximum of approximately $69 million at March 31, 2005. The operating leases expire through 2007. There are no recourse provisions or collateral that would enable us to recover any amounts paid under this guarantee.

(2) Prior to January 1, 2003, we issued a guarantee to a financial institution related to debt of our joint ventures in Argentina, our unconsolidated affiliates. The term of the guarantee is equal to the term of the related financing, which matures in 2009. There are no recourse provisions or collateral that would enable us to recover any amounts paid under this guarantee.

(3) We issued guarantees to a financial institution in Brazil related to amounts owed the institution by certain of our customers. The terms of the guarantees are equal to the terms of the related financing arrangements, which can be as short as 120 days or as long as 360 days. In the event that the customers default on their payments to the institutions and we would be required to perform under the guarantees, we have obtained collateral from the customers. At March 31, 2005, $65 million of these financing arrangements were collateralized by tangible property. We have determined the fair value of these guarantees to be immaterial at March 31, 2005.

In addition, we have provided parent level guarantees of the indebtedness outstanding under certain senior credit facilities and senior notes, which were entered into by our wholly owned subsidiaries. The debt under these guarantees had a carrying amount of $2,514 million at March 30, 2005. Debt related to these guarantees is included in the condensed consolidated balance sheet at March 30, 2005. There are no significant restrictions on the ability of any of our subsidiaries to transfer funds to us.

Also, certain of our subsidiaries have provided guarantees of indebtedness of certain of their subsidiaries under certain lines of credit with various institutions. The total borrowing capacity under these lines of credit is $321 million as of March 31, 2005, of which there was no related amount outstanding as of such date.

Dividends

In February 2005, we announced that our board of directors declared a regular quarterly cash dividend of $0.13 per share. The dividend is payable on May 31, 2005 to shareholders of record on May 17, 2005.

Critical Accounting Policies

Critical accounting policies are defined as those policies that are both important to the portrayal of our financial condition and results of operations and require management to exercise significant judgment. For a complete discussion of our accounting policies, see our annual report on Form 10-K for the year ended December 31, 2004, filed with the Securities and Exchange Commission. There have been no significant changes in our critical accounting policies since December 31, 2004.

Recent Accounting Pronouncements

In March 2005, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 47 (FIN 47), Accounting for Conditional Assets Retirement Obligations an interpretation of FASB Statement No. 143. FIN 47 clarifies that an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liability’s fair value can be reasonably estimated. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective December 31, 2005 for calendar year companies. We are currently evaluating FIN 47 to determine the impact on our consolidated financial statements.

In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment (SFAS No. 123R), that requires all share-based payments, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosure is no longer an alternative. At the time of its issuance, SFAS No. 123R was effective for the first interim or annual periods beginning July 1, 2005. In April 2005, the SEC issued an amendment to Rule 4-01(a) of Regulation S-X of the Exchange Act regarding the compliance date for SFAS No. 123R. The amendment requires companies to prepare financial statements in accordance with SFAS No. 123R beginning with the first interim or annual period of a company’s first fiscal year beginning on or after June 15, 2005, therefore, for companies with a calendar fiscal year end the, effective date is January 1, 2006. We currently report stock compensation based on Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees, with pro forma disclosures regarding fair value.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Risk Management

As a result of our global operating and financing activities, we are exposed to changes in agricultural commodity prices, foreign currency exchange rates, interest rates and energy and transportation costs which may affect our results of operations and financial position. We use derivative financial instruments for the purpose of managing the risks and/or costs associated with these exposures. While these hedging instruments are subject to fluctuations in value, those fluctuations are generally offset by the value of the underlying exposures being hedged. The counter-parties to these contractual arrangements are primarily major financial institutions or, in the case of commodity futures and options, a commodity exchange. As a result, credit risk arising from these contracts is not significant and we do not anticipate any significant losses. Our board of directors’ finance and risk management committee supervises, reviews and periodically revises our overall risk management policies and risk limits. We only enter into derivatives that are related to our inherent business and financial exposure as a global agribusiness company.

Commodities Risk

We operate in many areas of the food industry from agricultural raw materials to the production and sale of branded food products. As a result, we use and produce various materials, many of which are agricultural commodities, including soybeans, soybean oil, soybean meal, wheat and corn. Agricultural commodities are subject to price fluctuations due to a number of unpredictable factors that may create price risk. We are also subject to the risk of counter-party defaults under forward purchase or sale contracts.

We enter into various derivative contracts, primarily exchange-traded futures, with the objective of managing our exposure to adverse price movements in the agricultural commodities used for our business operations. We have established policies that limit the amount of unhedged fixed-price agricultural commodity positions permissible for our operating companies, which are a combination of quantity and value at risk limits. We measure and review our sensitivity to our net commodities position on a daily basis.

Our daily net agricultural commodity position consists of inventory, related purchase and sale contracts, and exchange-traded contracts, including those used to hedge portions of our production requirements. The fair value of that position is a summation of the fair values calculated for each agricultural commodity by valuing each net position at quoted average futures prices for the period. Market risk is estimated as the potential loss in fair value resulting from a hypothetical 10% adverse change in prices. The results of this analysis, which may differ from actual results, are as follows:

	Three Months Ended March 31, 2005						Year Ended December 31, 2004
(US$ in millions)	Fair Value			Market Risk			Fair Value			Market Risk

Highest long position	$	89		$	9		$	414		$	41
Highest short position	(172		)	(17		)	(13		)	(1		)

Currency Risk

Our global operations require active participation in foreign exchange markets. To reduce the risk of foreign exchange rate fluctuations, we follow a policy of hedging net monetary assets and liabilities and transactions denominated in currencies other than the functional currencies applicable to each of our various subsidiaries. Our primary exposure is related to our businesses located in Brazil and Argentina and to a lesser extent, Europe and Asia. To minimize the adverse impact of currency movements, we enter into foreign exchange swaps and option contracts to hedge currency exposures.

When determining our exposure, we exclude intercompany loans that are deemed to be permanently invested. The repayments of permanently invested intercompany loans are not planned or anticipated in the foreseeable future and therefore are treated as analogous to equity for accounting purposes. As a result, the foreign exchange gains and losses on these borrowings are excluded from the determination of net income and recorded as a component of accumulated other comprehensive income (loss). The balance of permanently invested intercompany borrowings was $1,023 million as of March 31, 2005 and $961 million as of December 31, 2004. The balance of permanently invested intercompany borrowings increased $62 million in first quarter of 2005 in order to fund capital expenditures in Brazil. Included in other comprehensive income (loss) are foreign exchange losses of $6 million in the three months ended March 31, 2005 and foreign exchange gains of $96 million in the year ended December 31, 2004, related to permanently invested intercompany loans.

For risk management purposes and to determine the overall level of hedging required, we further reduce the foreign exchange exposure determined above by the value of our agricultural commodities inventories. Our agricultural commodities inventories, because of their international pricing in U.S. dollars, provide a natural hedge to our currency exposure.

Our net currency positions, including currency derivatives, and our market risk, which is the potential loss from an adverse 10% change in foreign currency exchange rates, are set forth in the following table. In addition, we have provided an analysis of our foreign currency exposure after reducing the exposure for our agricultural commodities inventory. Actual results may differ from the information set forth below.

(US$ in millions)	March 31, 2005				December 31, 2004

Brazilian Operations (primarily exposure to U.S. dollar):
Net currency short position, from financial instruments, including derivatives	$	(904		)	$	(1,091	)
Market risk	(90			)	(109		)
Agricultural commodities inventories	828				988
Net currency short position, less agricultural commodities inventories	(76			)	(103		)
Market risk	$		(8	)	$	(10	)

Argentine Operations (primarily exposure to U.S. dollar):
Net currency short position, from financial instruments, including derivatives	$		(97	)	$	(81	)
Market risk	(10			)	(8		)
Agricultural commodities inventories	108				93
Net currency long position, less agricultural commodities inventories	11				12
Market risk	$		1		$	1

European Operations (primarily exposure to U.S. dollar):
Net currency short position, from financial instruments, including derivatives	$		(142	)	$	(320	)
Market risk	(14			)	(32		)
Agricultural commodities inventories	168				283
Net currency long (short) position, less agricultural commodities inventories	26				(37		)
Market risk	$		3		$	(4	)

Interest Rate Risk

There was no significant change in our interest rate risk profile in the first quarter of 2005.

Interest Rate Derivatives — We use various derivative instruments to manage interest rate risk associated with outstanding or forecasted fixed and variable rate debt and debt issuances, including interest rate swaps, options, and futures as may be required. In September 2004, we entered into various new interest rate swap agreements to manage our interest rate exposure on a portion of our fixed rate debt. We have accounted for these swap agreements as fair value hedges.

The interest rate swaps used by us as derivative hedging instruments have been recorded at fair value in other liabilities in the condensed consolidated balance sheets with changes in fair value recorded currently in earnings. Additionally, the carrying amount of the associated debt is adjusted through earnings for changes in the fair value due to changes in interest rates. Ineffectiveness, as defined in SFAS No. 133, Accounting for Derivative Instrumetns and Hedging Activities (SFAS No. 133), is recognized to the extent that these two adjustments do not offset. As of March 31, 2005, we recognized no ineffectiveness related to the interest rate swap hedging instruments. The derivatives we entered into for hedge purposes are assumed to be perfectly effective under the shortcut method of SFAS No. 133. The differential to be paid or received on changes in interest rates is recorded as an adjustment to interest expense. The interest rate swaps settle every six months until expiration.

The following table summarizes our outstanding interest rate swap agreements accounted for as fair value hedges as of March 31, 2005.

	Maturity								Fair Value
(US$ in millions)	2008			2014			Total		March 31, 2005

Receive fixed/pay variable notional amount	$	500		$	500		$	1,000	$	(32	)
Weighted average variable rate payable (1)	4.12		%	4.08		%
Weighted average fixed rate receivable	4.375		%	5.35		%

(1) Interest is payable in arrears based on a forecasted rate of six-month LIBOR plus a spread.

We recognized $1 million of accrued interest receivable as a reduction of interest expense in the three months ended March 31, 2005, in the condensed consolidated statements of income, relating to our outstanding swap agreements.

Item 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures — As of March 31, 2005, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as that term is defined in Exchange Act Rule 13a-15(e) and 15d-15(e). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective in timely alerting them to material information relating to Bunge (including our consolidated subsidiaries) required to be included in our filings with the Securities and Exchange Commission.

Internal Control Over Financial Reporting — During the quarterly period covered by this Form 10-Q, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Bermuda		98-0231912
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

50 Main Street, White Plains, New York		10606
(Address of principal executive offices)		(Zip Code)

(914) 684-2800
Registrant’s telephone number, including area code

	BUNGE LIMITED


Date: May 10, 2005	By:	/s/ William M. Wells
		William M. Wells
		Chief Financial Officer


		/s/ T.K. Chopra
		T.K. Chopra
		Controller and Principal
		Accounting Officer

31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

UNITED STATES

12. COMMITMENTS AND CONTINGENCIES

14. STOCK-BASED COMPENSATION

15. EARNINGS PER SHARE

16. ARGENTINA

17. SEGMENT INFORMATION