Volatility in agricultural commodities has driven a jump in first-quarter profits at US food giant Cargill.
In the three months to the end of August, Cargill’s net earnings jumped 68% to US$883m. Excluding results fertilizer firm The Mosaic Co., in which Cargill owns a majority stake, earnings stood at $693m, an increase of 51% on the year.
Cargill’s first-quarter sales increased 6% to $27.8bn.
“Cargill posted a strong start to the new fiscal year,” said chairman and CEO Greg Page. “Our results were led by the food ingredients and the commodity trading and processing segments, both of which experienced resurgence in volatility across agricultural commodity markets. The change put Cargill’s global breadth, trading and risk management skills more acutely into play as we worked with customers to help them manage their price risk and raw material needs.”
The company said earnings from its origination and processing divisions rose “significantly” amid the market volatility.
Earnings from Cargill’s food ingredients and applications division rose “moderately” thanks to an “improved performance” from the food ingredient and animal nutrition units.
