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News 233 views last update:6 Aug 2012

Cargill earnings surge in first quarter

Earnings in the first fiscal quarter of Minneapolis-based Cargill Inc. have surged 83%, referring to successes in the company's origination and processing segment, which produces agricultural commodities.

For the quarter ended Aug. 31, net earnings were $917 million, compared with $500 million in the year-earlier period.

"June through August was an extraordinary period, with growing demand for agricultural commodities against tightening suppliers and a long anticipated but dramatic reduction in liquidity and leverage in financial markets," chairman and CEO Greg Page said in a news release.

Being a privately held company Cargill does not break out sales or earnings by segment. The company did, however, report that results were led by Cargill's origination and processing segment, which sources, processes, markets and distributes agricultural commodities and provides supply chain and risk management services to customers globally.

Two segments -- food ingredients and applications, and industrial -- also outperformed last year's first-quarter earnings. The agriculture services segment, which serves crop and livestock producers, edged ahead of last year's results.

The risk management and financial segment was moderately below the year-ago level, which reflected smaller contributions from some energy and financial activities.

Cargill began the process of purchasing the remaining shares of Agrograin, a Hungarian grain company in which it bought a minority interest and formed a joint venture in 1995. The acquisition supports the further development of Cargill's grain and oilseeds origination capacity in central and east Europe.

Cargill announced plans to double the capacity of its canola processing plant in Clavet, Saskatchewan. The project is a part of Cargill's ongoing investments in new and expanded facilities that support the company's supply chain solutions for customers.

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