Australian wheat exporter AWB is in the sights of a Canadian bidder, fertiliser producer Agrium.
Agrium is offering $A1.50 per share in cash for AWB, which eclipses a previously-agreed all-scrip merger between AWB and Australian grain-handler GrainCorp at $A1.09 per share.
Radio New Zealand's Sydney correspondent says this means the premium being offered by the Canadian company highlights the huge value that agricultural companies are now seeing in the food market in India and China.
AWB formerly had a monopoly on wheat exports from Australia, but lost that when it was found to have made bribes to Saddam Hussein's former regime in Iraq in return for guarantees on wheat shipments.
Meanwhile, BHP Billiton is making a bid worth $US40 billion for Potash Corporation, the world's largest producer of agricultural fertiliser.
The bid turned hostile last week after the Canadian target company rejected BHP's offer of $US130 per share as grossly undervaluing Potash.
BHP sees fertiliser as a way from diversifying away from its core metals and minerals business at a time of skyrocketing farm commodity prices.
But Radio New Zealand's Sydney correspondent says the market reaction to the bid indicates it may have to dig deeper.