Linked In
News In
Linked In

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

Cargill profits quadruple as political fog clears

Twitter Linkedin eCard

Cargill, for a second successive quarter, reported a quadrupling in profits, helped by a return in its meat business into the black, and the waning of the political influence on prices which tripped it up last year.

The US-based group, the world's biggest agricultural commodities trader, reported a jump in earnings to $409m in the September-to-November quarter, up from $100m a year before.

Revenues at Cargill, one of the world's largest privately-held groups, which publishes only limited financial information, rose 5.7% to $35.2bn.

Higher margins

The profits leap reflected in part "an improved margin environment in oilseed processing in several regions".

Industry soybean crushing volumes in the US reached among their highest levels in five years in October and December, on National Oilseed Processing Association estimates, supported by healthy profitability.

Furthermore, the group's animal protein segment returned to profit, after falling into the red a year before "when processing margins in the US beef industry were sharply negative".

"Most of the meat businesses benefited from improved volumes or margins in the current period, even though results were tempered by higher raw material or livestock feeding costs," Cargill said.

'Strong trading results'

But the group also flagged an improved crop trading record from last year, after political factors took a lower profile on the market agenda, allowing prices to move to fundamental news, which Cargill found easier to read.

The group revealed "strong global trading and risk management results in more fundamentally driven markets".

The risk management division itself "turned around last year's second-quarter loss, the latter a period when financial markets were stressed by debt turmoil in the US and Europe".

Indeed, a year before, when profits fell to their lowest in more than a decade, Cargill chief executive Greg Page acknowledged the "challenges" of reading financial markets moving largely in response to political factors, such as the eurozone debt crisis.

Ethanol setback

Mr Page termed the latest results "solid", saying earnings were "balanced and diversified across the breadth of the company".

Food ingredients operations bucked the trend, posting earnings "moderately" below year-ago levels.

"The slippage was mostly related to excess capacity in the North American ethanol market and the return of profits in some product lines to more normalised levels," Cargill said.


Twitter Linkedin eCard
Related Stories

US corn export sales jump, cotton data reassure

... and soybean export sales too were ahead of forecasts last week. But wheat’s performance, again, disappoints, official data show

Trade deal with US could see UK obesity soar, says former opposition farm minister

Kerry McCarthy, former agriculture minister for the opposition Labour party, turns to Mexico and Samoa for evidence to support her allegation

Morning round-up, Thursday January 4

New Zealand cheese into China... Starbucks JV... Monsanto wins glyphosate support...

Morning round-up, Wednesday January 3

Dry Argentine outlook... shares in chicken producers fall... JAB Holding eyes further acquisitions...
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© 2017 and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069