US agribusiness giant Cargill has booked a 30% rise in underlying quarterly profits as the company managed to benefit from the volatility in commodity markets.
The company today (13 April) posted earnings from continuing operations of US$763m for the three months to 28 February, compared to $588m a year earlier.
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Earnings from The Mosaic Co., classified as earnings from discontinued operations after Cargill’s decision to spin off its majority stake in the fertilizer business, stood at $342m.
Cargill’s net earnings in the third quarter rose 23% to $1.11bn, the company said. Revenues excluding Mosaic were up 21% to $30.5bn.
Chairman and CEO Greg Page said Cargill had posted “solid” earnings for the quarter. The company, he said, was operating “in a period of volatile commodity markets and geopolitical change”.
“All of us in agriculture are living with high levels of price volatility, in which small changes in the quantity of production are having dramatic impacts on price,” Page said.
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By GlobalData“Cargill’s ability to focus on the factors of supply and demand, while gauging external events that can uproot market fundamentals temporarily, is critical to the risk management services we provide to our customers and to our own financial performance.”
Four of Cargill’s five business segments increased earnings in the third quarter. Results were led by the origination and processing division, which among other functions, sources, trades and processes grain and oilseeds.
Cargill’s food ingredients and applications division increased earnings “moderately”, the company said.
The unit that saw earnings fall was Cargill’s agricultural services division, where profits “fell slightly”, it added.
