Cargill to Slash 8,000 Jobs Amid Revenue Decline
Source: DairyNews.today
Cargill Inc. announced plans to reduce its global workforce by approximately 5%, or around 8,000 positions, as the agricultural giant grapples with a sharp revenue decline tied to multi-year lows in crop prices.
The cuts come as commodity traders like privately held Cargill face mounting challenges fr om falling prices of crops such as wheat, corn, and soybeans, coupled with shrinking processing margins.
Restructuring for Efficiency
Most of the layoffs will occur within the current fiscal year, according to a memo from CEO Brian Sikes reviewed by Reuters. The restructuring aims to streamline operations, eliminate redundancies, and broaden managerial responsibilities.
“This move will focus on removing layers, expanding the scope of our managers, and reducing duplication of work,” Sikes said in the memo.
The nearly 160-year-old Minnesota-based company said the job cuts are part of a broader strategic shift. “Unfortunately, that means reducing our global workforce by approximately 5%,” Cargill stated.
Cargill employs more than 160,000 people worldwide, making the reductions among its largest in recent years.
Revenue Under Pressure
Cargill’s revenue fell to $160 billion for the fiscal year ended May 2024, down from a record $177 billion the previous year. The company, which does not release quarterly earnings, revealed in an internal memo earlier this year that fewer than one-third of its business units met earnings targets in the last fiscal year.
Strategic Overhaul
The company is reorganizing its operations, consolidating five business units into three under its "2030 strategy," announced in August. A company-wide meeting is scheduled for December 9 to provide additional details on the restructuring.
“In countries wh ere we can immediately communicate to employees whose roles are impacted, meetings will be held this week to outline next steps,” Sikes noted.
Industry Challenges
Cargill’s workforce reduction follows broader challenges in the agricultural sector. Competitor Archer-Daniels-Midland recently disclosed accounting irregularities and is contending with weaker earnings. Meanwhile, U.S.-based Bunge Ltd. is working to finalize its acquisition of Glencore-backed Viterra after regulatory hurdles, with completion expected by early 2025.
Despite the downturn, Sikes emphasized that Cargill’s operational and frontline teams would be minimally affected to ensure continued service to customers.
The job cuts were first reported by Bloomberg News.
Restructuring for Efficiency
Most of the layoffs will occur within the current fiscal year, according to a memo from CEO Brian Sikes reviewed by Reuters. The restructuring aims to streamline operations, eliminate redundancies, and broaden managerial responsibilities.
“This move will focus on removing layers, expanding the scope of our managers, and reducing duplication of work,” Sikes said in the memo.
The nearly 160-year-old Minnesota-based company said the job cuts are part of a broader strategic shift. “Unfortunately, that means reducing our global workforce by approximately 5%,” Cargill stated.
Cargill employs more than 160,000 people worldwide, making the reductions among its largest in recent years.
Revenue Under Pressure
Cargill’s revenue fell to $160 billion for the fiscal year ended May 2024, down from a record $177 billion the previous year. The company, which does not release quarterly earnings, revealed in an internal memo earlier this year that fewer than one-third of its business units met earnings targets in the last fiscal year.
Strategic Overhaul
The company is reorganizing its operations, consolidating five business units into three under its "2030 strategy," announced in August. A company-wide meeting is scheduled for December 9 to provide additional details on the restructuring.
“In countries wh ere we can immediately communicate to employees whose roles are impacted, meetings will be held this week to outline next steps,” Sikes noted.
Industry Challenges
Cargill’s workforce reduction follows broader challenges in the agricultural sector. Competitor Archer-Daniels-Midland recently disclosed accounting irregularities and is contending with weaker earnings. Meanwhile, U.S.-based Bunge Ltd. is working to finalize its acquisition of Glencore-backed Viterra after regulatory hurdles, with completion expected by early 2025.
Despite the downturn, Sikes emphasized that Cargill’s operational and frontline teams would be minimally affected to ensure continued service to customers.
The job cuts were first reported by Bloomberg News.
