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Commodities giant Cargill Inc. said annual revenues soared 23% to a record $165 billion in a fiscal year marked by “extreme events.”
Cargill reported its new sales benchmark for the year ending May 31 Wednesday in the company’s annual report, showing that the trend of strong sales from the world’s grain merchant companies continues in the face of supply-chain woes, rising food inflation and disruptions from war.
Chief Executive Officer David MacLennan and Chief Operating Officer Brian Sikes said the fiscal year was punctuated by extreme events that included “the ongoing Covid-19 pandemic, severe weather, trade disruptions, and Russia’s invasion of Ukraine,” according to their letter to shareholders. The executives said they “anticipate ongoing disruptions in our industries and the world” to linger, though remain “optimistic” the 157-year-old firm “will continue to find new ways forward.”
Russia’s invasion of the Ukraine in late February disrupted global commodities trading, especially corn, wheat and vegetable oil from the Black Sea breadbasket. With unknown supplies and deliveries from this region, global crop prices went higher, giving global companies that buy and sell grains from diverse markets a good position to profit from supply-chain disruptions.
Last month, Archer-Daniels-Midland Co. and Bunge Ltd. increased full-year guidance for 2022 after reporting second-quarter earnings results, with the revisions fueled by high grains prices across the globe. ADM posted its best quarter ever, with the highest profit in the agricultural trader’s history. They are the “A” and “B” of the ABCD group of merchant companies that have dominated grain trading for a century, with Cargill being the “C” in the group.
The Minneapolis-based company has 155,000 employees in 70 countries and sells to clients in 125 countries, according to its annual report. Last month, Cargill and Continental Grain Co. bought Sanderson Farms, the third-biggest chicken producer in the US, for about $4.5 billion. Cargill is already one of the largest beef processors in the country.