Cargill, one of the world’s largest agricultural trading houses, announced plans to reduce its global workforce by 5%, equating to approximately 8,000 jobs. The decision comes after the company faced a significant revenue drop in its 2024 fiscal year, with earnings falling to $160 billion from a record $177 billion the previous year.
CEO Brian Sikes, in a memo reviewed by Reuters, explained the layoffs aim to streamline the organization by eliminating layers, broadening managerial responsibilities, and reducing work duplication. “Unfortunately, that means reducing our global workforce by approximately 5%,” Sikes stated.
Key Drivers:
- Market Pressure: Prices for key crops like wheat, corn, and soybeans have plummeted to near four-year lows, compressing processing margins and impacting profitability.
- Missed Targets: Less than one-third of Cargill’s businesses met their earnings goals last year, prompting a shift in strategy.
Strategic Changes:
- In August, Cargill unveiled plans to restructure its operations into three units (from five) as part of its 2030 strategy.
- A company meeting on Dec. 9 will provide further details on the restructuring process.
Cargill emphasized that impacts on frontline teams will be minimized to ensure continued service to customers.