USA – Cargill, a leading commodity trading company, is reportedly planning a significant reorganization, reducing its current five operational units to three.
This is according to an internal memo viewed by Reuters and confirmed by two anonymous company insiders.
Cargill, headquartered in Minnesota and a leading supplier of agricultural commodities since its establishment in 1865, plans to reorganize into three divisions: Food, Ag & Trading, and a Specialized Portfolio focusing on animal nutrition and health.
Like many of its industry peers, the restructuring comes as Cargill faces economic pressures due to declining prices of key commodity crops and narrowing margins in crop processing.
The memo reveals that the company aims to cut costs and optimize capital investments in response to these market challenges.
Cargill’s CEO Brian Sykes emphasized the necessity of the overhaul, stating, “Our recent performance and emerging market trends underscore the urgent need for change.”
The Food division will merge the existing Food & Bio and Protein & Salt teams, while Cargill Risk Management and Metals will be integrated into the Ag & Trading division.
According to Bloomberg reporters Michael Hirtzer and Isis Almeida, Jon Nash, who currently oversees Cargill’s protein and salt unit, will lead the new Food division.
Roger Watchorn, in charge of the agricultural supply chain, will head the Ag & Trading division, and David Webster, currently serving as chief risk officer, will manage the Specialized Portfolio.
This strategic shift follows broader industry trends where ample crop supplies have squeezed profits for agricultural commodity traders, a challenge not unique to Cargill.
Competitors like Archer-Daniels-Midland Co. and Bunge Global SA have also reported reduced earnings recently.
Cargill’s challenges are further compounded by a dwindling American cattle herd, the smallest in 70 years, which has negatively impacted its beef processing operations.
The restructuring follows recent layoffs, including the elimination of 200 tech jobs across multiple locations, as part of Cargill’s efforts to build a new technology hub in Atlanta.
The company, which remains the largest privately-held business in the U.S., continues to navigate these changes without publicly disclosing its earnings, in contrast to its publicly-listed rivals.
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