Sales and pre-tax profits at Louis Dreyfus Company, the
agricultural trading giant, fell sharply in 2016, thanks to falling prices for
grains and oilseeds, although post-tax profits rose.
And the privately-owned company warned that conditions are
unlikely to improve in 2017.
Net sales fell by 10.6% year-on-year, to $49.8bn, due to
lower prices, in the year to December 21 2016, Dreyfus said.
The company reported sales by volume "remaining stable
compared to 2015".
The company reported consolidated pre-tax profits down 12.3%
year-on-year, at $365m.
But consolidated net income rose by 45%, to $305m.
"2016 was marked by strong supply and abundant inventories
for some commodities, which led to challenging market conditions, worsened by volatility
working against some market fundamentals," Louis Dreyfus said.
The company's trading arm, which covers grains, oilseeds and
sugar, "posted decent logistics and processing margins".
But net sales were impacted by "marginally reduced activity
levels<" as well as lower average selling prices for oilseeds and grains.
And Dreyfus' merchandising segment benefited from a strong
contribution from its metals unit, for which the company
But net sales fell for the Merchandizing segment due to
remain in place
And these pressures will remain in place this year, Dreyfus
chief executive Gonzalo Ramirez Martiarena said.
Mr Ramirez said "oversupply, market shocks, geopolitical
dynamics and adverse weather conditions were some of the difficulties that the
agribusiness industry had to face during 2016".
"Market fundamentals are unlikely to be very different in
2017," said Mr Ramirez.