Global trader Cargill said on Tuesday it plans to cut about 5% of its staff, or about 8,000 jobs, after revenue fell in the most recent fiscal year as crop prices hit multi-year lows.
Agricultural trading companies, including privately held Cargill, are under pressure as prices for commodities such as wheat, corn and soybeans have fallen to levels near four-year lows and crop processing margins have shrunk.
The bulk of Cargill’s job cuts will occur this year, company President and CEO Brian Sikes said in a memo seen by Reuters on Tuesday.
“They will focus on simplifying our organizational structure by removing layers, expanding the scope and responsibilities of our managers, and reducing duplicative work,” Sikes said in the memo.
The move is part of a strategic shift at the nearly 160-year-old company, Cargill said when asked about the memo.
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“Unfortunately, this means reducing our global workforce by approximately 5%,” he said.
Minnesota-based Cargill has more than 160,000 employees, implying that a 5% staff cut would hit about 8,000 jobs.
Cargill reported revenue of $160 billion in fiscal 2024, which ended in May, down from the previous year’s record $177 billion.
Cargill does not release quarterly earnings statements, but in a memo seen by Reuters in August, the company said less than a third of its businesses met profit targets in the last fiscal year.
Sikes said the company will hold a meeting on December 9 to share more information about the restructuring.
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“This week, for those in countries where we can immediately communicate with employees in affected roles, we will set up meetings to explain next steps,” he said.
Cargill’s restructuring comes as its competitor, Archer-Daniels-Midland, also faces challenges after discovering accounting irregularities and at the same time dealing with weaker profits.
