December 5, 2024
Cargill to cut 8,000 jobs amid revenue decline
Global trading house Cargill announced plans to reduce its global workforce by approximately 5%, equating to about 8,000 jobs, following a drop in revenue during its most recent fiscal year.
The decision comes as commodity crop prices, including wheat, corn, and soybeans, hit near four-year lows, and crop processing margins narrowed.
Cargill's president and CEO, Brian Sikes, confirmed that many of the job reductions would occur within the year. "They will focus on streamlining our organisational structure by removing layers, expanding the scope and responsibilities of our managers, and reducing duplication of work," Sikes stated.
The Minnesota-based company, which has been in operation for nearly 160 years, said the decision aligns with a shift in its broader strategy. "Unfortunately, that means reducing our global workforce by approximately 5%," Cargill said when asked about the memo.
Cargill employs over 160,000 people worldwide, making the 5% reduction equivalent to around 8,000 positions. The company clarified that impacts to frontline operations and teams would be minimised to maintain service to customers.
For its 2024 fiscal year ending in May, Cargill reported revenue of US$160 billion, down from the record US$177 billion achieved the previous year. The company does not release quarterly earnings but noted in an August memo that less than one-third of its businesses met their earnings goals during the last fiscal year.
The restructuring will consolidate Cargill's operations into three units from five as part of its 2030 strategy. This move follows its earlier announcement in August about planned structural changes after failing to meet internal earnings targets.
Sikes informed employees that more details about the restructuring would be shared during a future meeting. "This week, for those in countries where we can immediately communicate to employees whose roles are impacted, we'll set up meetings to explain next steps," he said.
The restructuring comes as Cargill faces pressure in a competitive landscape. Rival Archer-Daniels-Midland is grappling with accounting irregularities and weaker earnings. Meanwhile, US grains trader Bunge Global expects to complete its acquisition of Glencore-backed Viterra by early 2025 after months of regulatory scrutiny.
- Reuters
