Cargill Inc. Tuesday posted a strong first quarter, with earnings up 68 percent as the agribusiness giant capitalized on pricing volatility in world grain markets and surging business in its fertilizer holdings.
Minnetonka-based Cargill, one of the world's largest privately held companies, recorded net earnings of $883 million in its fiscal first quarter, which ended Aug. 31. Excluding earnings from its majority investment in Mosaic Co., a publicly traded Plymouth-based fertilizer producer, Cargill earned $693 million, up 51 percent from the same time last year.
Meanwhile, Cargill's first-quarter revenue came in at $27.8 billion, up 6 percent over last year's fiscal first quarter.
"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,'' Cargill Chief Executive Greg Page said in a news release.
Grain trading, of course, has long been a core Cargill competency. As prices in world grain markets swung upward during the first quarter, Cargill reaped the rewards with its various trading strategies. The food ingredients operation, Cargill's biggest business unit, includes everything from corn sweeteners to meat products and cocoa.
Results in Cargill's origination and processing businesses, which include transporting and processing commodities such as soybeans, also rose significantly. Also, market volatility and changes in trade flows -- for instance, a big drought that has affected Russian grain production -- have helped that business.
Cargill's agricultural services business unit saw earnings decline, partly due to seasonal factors and partly to lower sales volume in the company's animal feed operations. Agricultural services also includes aiding North American farmers in marketing their grain.
Mike Hughlett • 612-673-7003