• By Lynda Kiernan

Cargill Continues Restructuring, Sells Retail Unit to Agrium

Less than two months after announcing the sale of its condiment business to Ventura Foods for an undisclosed amount, Cargill is continuing its strategic streamlining, announcing the sale of its ag-retail unit to Calgary-based Agrium.

Cargill has agreed to divest its 18 ag-retail locations that sell inputs including seeds and fertilizer at locations in Nebraska, South Dakota, Minnesota, Wisconsin, Michigan, and Indiana with annual revenue in excess of $150 million. However the sale does not include Cargill’s Canadian crop input retail locations.

The 151-year old global grain trader has been undertaking a structural reorganization aimed at streamlining its operations down to its core, more profitable businesses such as grain trading and processing, food ingredients and aquaculture, through the sale of some lower-margin units.

Bloomberg reports that in the face of falling commodity prices, over the past two years, Cargill has announced no less than nine divestments, as chief executive, David MacLennan heads the consolidation of 70 business into five groups tailored to meet customers’ needs.

"Cargill will focus on being the world's leading merchant of grain and oilseeds," said Roger Watchorn, Cargill's lead for the North American agricultural supply chain in a statement.

Agrium however, has been targeting a 25% market share in the U.S. though the construction or acquisition of additional ag-retail stores, CEO Chuck Magro told Reuters.

“This acquisition demonstrates our continued focus on growing our North American ag-retail business, particularly in the highly desirable U.S. Corn Belt,” said Magro in a recent press release. The locations are in regions where we currently have a limited presence.”

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Lynda Kiernan is Editor with HighQuest Group Media and of the Oilseed & Grain News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@highquestgroup.com.

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