By Ed White

WINNIPEG, Manitoba, Jan 16 (Reuters) - Farmers warn Canada's approval of U.S. grain trader Bunge's BG.N $34-billion takeover of Glencore-backed GLEN.L Viterra will reduce their options to sell crops at competitive prices, and say the government did not require enough concessions.

Canada's approval with conditions on Tuesday was one of the final steps needed to close the largest-ever global agriculture merger by dollar value. Experts had expected asset sales would be required in a country where the companies' businesses overlap.

Farmers in Canada, the world's top canola producer and No. 3 wheat grower, are struggling with years of drought and low commodity prices. Consolidation among grain traders may reduce farmers' leverage to receive reasonable prices.

"Farmers will be the ones suffering," said Agricultural Producers Association of Saskatchewan president Bill Prybylski. Farmers have worried combining Bunge's oilseed-crushing plants with Viterra's grain storage, shipping and processing plants, plus Bunge's minority stake in grain company G3, would limit competition in some areas.

Conditions for approval from Transport Minister Anita Anand included Bunge selling six Western Canada grain elevators, which are storage and transportation facilities, and two oilseed-crushing plants. Canada also required Bunge officials on G3's board of directors to be replaced with independent directors. G3 is partly owned by Saudi Arabia's SALIC.

"Minister Anand's decision to approve the acquisition, even with conditions, doesn't go nearly far enough," said Kyle Larkin, executive director of the Grain Growers of Canada farmer group, in a statement. "These conditions do little to offset the $770 million annual cost this merger will impose on farmers."

Larkin said the merger will reduce competition across the Prairies and in Quebec.

Anand's office did not immediately respond to a request for comment.

CRUSH PLANT SALE ORDER WELCOMED

Jill Verwey, president of Keystone Agricultural Producers, said the ordered sale of an oilseed crushing plant south of Winnipeg and just north of the U.S. border did address one of the chief concerns of Manitoba's main farmers organization.

Bunge announced the proposed merger in 2023. The company said in a Tuesday statement that it expects to close the merger early this year. It separately said approval from Chinese authorities is the final major step.

Viterra declined to comment.

A 2024 study by agricultural economists commissioned by farmer organizations found the deal would give the merged company and G3 45% of Vancouver port grain terminal capacity. Canada's Competition Bureau dismissed those concerns, saying its analysis suggested port terminals mostly serve their owners' needs and do not compete for other companies' export business.

(Reporting by Ed White; Editing by Caroline Stauffer and Rod Nickel)

((ed.white@thomsonreuters.com;))