We all depend on food to eat and other the years some very large agriculture companies have emerged in the world of agriculture commodities world. The big four companies are ADM or Archer-Daniels Midland, Bunge (based in Paris), Glencore (based in Switzerland) and Cargill. All these companies have their roots in the grain trade and if you ever drive across the wheat belt you will see their names on elevators where farmers bring their grain to be sold around the world. The companies are vertically integrated and diversified into countries around the world.

In an article by Kate Helmore of Reuters, Cargill one of the world’s largest private companies is looking to slash costs as prices for corns and soybean hits four-year record lows. the company’s revenue dropped to $160 billion for the 2024 fiscal year, down from $177 billion in 2023. Less than 1/3 of its businesses met their earnings goal in the last fiscal year.

The focus of the layoffs is at the managerial level – to streamline the organizational structure by removing layers, expanding the scope and responsibilities of our managers and reducing duplication of work, noted Brian Sikes, Cargill’s President and CEO.

Linking to dividend paying stocks, all companies have to watch costs in their companies. It does not matter how much revenues are brought in, examining costs is a yearly expectation. In theory as a private company, it is easier to cut costs, but you are dealing with people and dealing with people you know is a tough decision. As a public company, from an outsider’s perspective it is easier to get buyin for cuts, as analysts will offer suggestions that can be done. Expect all your investments to have cuts and whether commodity prices are up or down, cutting costs is part of the business.

There are more questions than answers, till the next time – to raising questions.