Ag demand drives Cargill profits up 44 percent
(AP) - Agribusiness giant Cargill said on Monday that second-quarter profits jumped 44 percent as it continued to benefit from strong demand for food commodities.
Cargill said it earned $954 million during the second quarter, up from $662 million during the same period last year. That brings its first-half earnings to $1.87 billion, up 61 percent from the first half of its prior year.
Cargill is one of the world's largest privately held companies, and discloses limited quarterly financial information.
Cargill makes food ingredients, moves commodities around the world and runs financial commodities trading businesses, and has 158,000 workers in 66 countries. Its operations include five feed mills in Vietnam, chocolate production in Brazil, and a sweetener facility in the U.K.
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The company said strong demand for agricultural commodities drove its quarterly profit. For instance, Cargill is one of the world's largest charterers of dry ocean shipping, and with strong demand it was able to use more of the capacity of those ships.
"Today we are moving bigger volumes of commodities, through more facilities, at higher utilization rates and over longer distances," said Cargill Chairman and Chief Executive Greg Page in a statement.
Cargill said four of its five segments saw an increase in second-quarter profits. It said the biggest contribution came from its origination and processing segment, which buys, processes and distributes agricultural commodities. Cargill's industrial segment also benefited from global demand for fertilizers.
Profits also grew in its segments for food ingredients and agricultural services. Profits in its segment for risk management and financial trading were "moderately below" last year's results, the company said.
"We are very pleased with today's results," Page said. "Strong fundamentals are driving volume and volatility in global agriculture today. Cargill is in position to benefit from these forces because of our past investments, our risk management and our commitment to creating shared value with customers."
(Copyright 2008 by The Associated Press. All Rights Reserved.)