Sector News

Reuters: ADM revamps Argentine grains trading in global shake-up

April 7, 2017
Consumer Packaged Goods

Archer Daniels Midland Co is restructuring its operations in Argentina in a move that will include job losses as part of a wider shake-up at the U.S. agribusiness group, three sources familiar with the plans said this week.

Chicago-based ADM is grappling with volatile global grain markets and has already exited energy trading and shed key personnel in recent months. It said on Wednesday it planned to close its South African trading operations.

In the latest development, ADM late last month shuttered its Toepfer grains trading unit, which had been based outside Buenos Aires, according to three industry sources familiar with the situation.

“There was some overlapping of functions between ADM and Toepfer. Redundant activities were cut,” said a Buenos Aires- based industry source with direct knowledge of the situation.

A photograph taken in late March of Toepfer’s former trading room in the suburb of Vicente Lopez and seen by Reuters showed stacks of cardboard filing boxed piled haphazardly among large ledger books strewn on the floor.

ADM first took an 80 percent stake in German trading house Alfred C. Toepfer International in 2002 and bought the rest of the company in 2014.

Toepfer Argentina, the largest surviving portion of the company, had about 85 trading and administrative staff in 2014. That number steadily fell until March, when a final 15 positions were eliminated. The 25 staff members who remained were transferred to a new ADM office in Buenos Aires, the sources said.

“ADM is streamlining its operations,” the source said.

The revamp hits at a time of increased competition from Chinese trading house COFCO Group, which has begun an aggressive expansion into international grains trading.

ADM’s public affairs office in the United States declined to comment.

In February, ADM reported a 41 percent drop in fourth-quarter net earnings to $424 million.

Gains in its agricultural services segment were blunted by more losses by its global trading desk.

The company in Argentina will be called ADM, while three grains elevators along the Parana River and in Bahia Blanca on the Atlantic coast will keep the Toepfer name. There are about 100 direct and indirect employees working at each of the three elevators. They are to stay on the job and continue exporting ADM and other products, sources said.

ADM established an office in Argentina in 1999 and has grown to be a major a major exporter of corn, sorghum and soybeans from the country, ADM’s website said.

By Hugh Bronstein and Jonathan Saul

Source: Reuters

comments closed

Related News

June 22, 2024

Britvic rejects $3.9bn takeover bid from Carlsberg

Consumer Packaged Goods

UK soft drink manufacturer Britvic has rejected a $3.95 billion takeover bid from Danish brewer Carlsberg. The Britvic board turned down a proposal worth 1,250 pence a share from the beer giant last week (11 June), following a previous offer (7 June) at 1,200 pence. The proposal positioned Britvic at an implied enterprise value multiple of 13.1x Britvic’s adjusted EBITDA of £302 million.

June 22, 2024

Tate & Lyle to acquire CP Kelco for US$1.8bn to form global specialty F&B giant

Consumer Packaged Goods

Tate & Lyle has agreed to acquire the entire issued share capital of CP Kelco, a leading provider of pectin, specialty gums and other nature-based ingredients, from J.M. Huber, for a total implied consideration of US$1.8 billion.

June 22, 2024

McDonald’s pulls plug on AI drive-through ordering after mishaps go viral

Consumer Packaged Goods

In one viral TikTok video, a customer recorded ordering caramel ice cream, but the AI-powered system filled the cup with stacks of butter instead. Another similar video showed the AI adding over a hundred orders of chicken nuggets to an order. A different customer received an ice cream topped with bacon.

How can we help you?

We're easy to reach