Archer Daniels Midland has followed rival Cargill in unveiling sizeable job cuts, two months after it warned of "a difficult and challenging market environment" as it unveiled lower profits.
The agribusiness giant, whose operations span grain trading to ethanol production, said it would axe about 1,000 positions in a drive "to ensure that we can continue to compete effectively in our global markets".
"These actions will help us enhance our productivity and earnings power," Patricia Woertz, the ADM chairman and chief executive, said.
She added that the shake-up would "streamline our organisation and achieve significant, sustained cost reductions", with ADM expected to save $100m a year from the cuts, a financial benefit which would start to be felt in the April-to-July quarter.
The full benefit would be realised by March 2013.
The programme will see ADM take a pre-tax charge of $50m-75min in its results for the April-to-July period, when Wall Street expects the group to report earnings, excluding one-off charges, of $524m, down some 9% year on year.
Tougher times
The cuts are the latest sign of stress in the agribusiness sector where many companies have noted hits from macroeconomic uncertainty, which has also stoked crop price volatility which many groups have found difficult to ride out.
Cargill, the privately-held agribusiness giant, on Tuesday, unveiling an 88% slump in earnings, highlighted the difficulty in tackling crop price volatility sparked primarily by political factors, such as efforts to tackle the eurozone crisis, rather than textbook supply and demand dynamics.
Cargill - whose earnings fell to their lowest since 2001, and which said it was "actively working to reduce costs" - unveiled 2,000 job losses last month.
ADM itself in November highlighted a "difficult and challenging environment", with oilseed crushing margins "generally weak" and historically elevated corn prices limiting profits from processing the grain.
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