Cargill, Incorporated is an American multinational food corporation based in Minnetonka, Minnesota, and incorporated in Wilmington, Delaware. Founded in 1865 by William Wallace Cargill, it is the largest privately held company in the United States in terms of revenue.
Some of Cargill's major businesses are trading, purchasing and distributing cereal and other agricultural commodity, such as palm oil; trading in energy, steel and transport; raising livestock and production of fodder; and producing food ingredients such as starch and glucose syrup, vegetable oil for application in ultra-processed foods and industrial use. Cargill also has a large financial services arm, which manages in the for the company. In 2003, it split off a portion of its financial operations into Black River Asset Management, a hedge fund with about $10 billion of assets and liabilities. It previously owned two-thirds of the shares of The Mosaic Company (sold off in 2011), a producer and marketer of concentrated phosphate and potash crop nutrients.
Cargill reported gross revenues of $165 billion in 2022. It last reported net profit earnings in 2021, of just below $5 billion. Employing over 160,000 employees in 66 countries, it is responsible for 25% of all United States grain exports. The company also supplies about 22% of the United States domestic meat market, importing more products from Argentina than any other company, and is the largest poultry producer in Thailand. All the eggs used in American McDonald's restaurants pass through Cargill's plants. It is the only US producer of Alberger process salt, which is used in the fast-food and prepared food industries.
Cargill has remained a Family business, as the descendants of the founder (from the Cargill family) own over 90% of it. In January 2023, Brian Sikes was appointed as president and CEO, the 10th CEO in Cargill's 158-year history.
Sam Cargill left La Crosse in 1887 to manage the office in Minneapolis, an important emerging grain center. Three years later, the Minneapolis operation incorporated as Cargill Elevator Co.; some years after that the La Crosse operation incorporated as W. W. Cargill Company of La Crosse, Wisconsin. In 1898, John H. MacMillan Sr., and his brother, Daniel, began working for W. W. Cargill. MacMillan then married William Cargill's eldest daughter, Edna.
John MacMillan ran the company until his retirement in 1936. Under his leadership Cargill grew several fold, expanding out of the Midwest by opening its first East coast offices, in New York, in 1923. He was also the architect of the company's strategy of internationalism.
The first of the crises was the debt left by the death of William W. Cargill. The company issued $2.25 million in Gold Notes, backed by Cargill stock, to pay off its creditors. The Gold Notes were due in 1917, but thanks to record grain prices caused by World War I all debts were paid by 1915.
As World War I continued into 1917, Cargill made record earnings and faced criticisms of . Four years later, as a fallout from the financial crash of 1920, Cargill posted its first loss.
Cargill opened its first Canadian operations in Montreal in 1928 as Cargill Grain Company Ltd. Headquartered in Winnipeg, it employs up to 8,000 people in Canada.
One of the biggest criticisms of Cargill has been its perceived arrogance (see, for example, Brewster Kneen in the Ecologist and also Greg Muttitt in the same journal). The MacMillans' aggressive management style led to a decades-long feud with the Chicago Board of Trade.
The US Commodity Exchange Authority and Chicago Board of Trade accused Cargill of trying to corner the corn market. In 1938, the Chicago Board suspended Cargill and three of its officers from the trading floor. When the Board lifted its suspension a few years later, Cargill refused to rejoin, instead trading through independent traders. During World War II, MacMillan Jr. continued to expand the company, which boomed as it stored and transported grain and built T1 tankers and ships for the United States Navy. In 1962, Cargill rejoined the Chicago Board of Trade, two years after MacMillan's death.
In 1960, Erwin Kelm became the first non-family chief executive. Aiming for expansion into downstream production, he led the company into milling, , and . As the company grew, it developed a market intelligence network as it coordinated its commodities trading, processing, freight, shipping, and futures contract businesses. In the decades before email, the company relied on its own telex-based system for internal communication. By 1972, Cargill's business grew with $5 billion in sales, becoming the largest agricultural trader in the world.
When the Soviet Union entered the grain markets in the 1970s, demand grew to unprecedented levels, and Cargill benefitted. In 1963, Cargill had already negotiated a $40 million wheat deal with the USSR, establishing a relationship that later involved a series of larger deals. When Whitney MacMillan, nephew of John Jr., took over the company from Kelm in 1976, revenue approached $30 billion. The US government put pressure on big grain exporters with allegations of manipulating the market, and Cargill was a major target, but it emerged without any major changes.
In 1978, Cargill purchased the large Leslie Salt refining company in Newark, California, from Schilling.
In 1979, Cargill entered the meat-processing business with the purchase of beef processor MBPXL (later Excel). The division expanded into turkey, food service and food distribution businesses and is now known as Cargill Meat Solutions.
In 1986 Cargill started operations in Venezuela through a partnership with the Possenti family's Mimesa C.A. to form Agroindustrial Mimesa in Maracaibo, dedicated to the manufacturing of flour and pasta. Expansion followed thereafter.
Tensions arose with the company's private shareholders, as Cargill typically put 80% of earnings back into the business. By the early 1990s, members of the Cargill and MacMillan families became upset that their shares in the company were yielding mediocre . Demands rose for an initial public offering to turn the company public. The company responded with an employee stock ownership plan, and in 1993 reportedly purchased 17% of the firm for $730 million from 72 Cargills and MacMillans. It used that stake to begin the employee stock plan. The company's board of directors was reorganized to reduce the number of relatives to six, alongside six independents and five managers.
Ernest Micek took over as chief executive in August 1995.
In 2002 Cargill acquired European-based starch manufacturer Cerestar from Montedison for $1.1 billion.
By 2002, Cargill had over $50 billion in annual sales, twice the amount of its closest rival, Archer Daniels Midland, and had 97,000 employees running more than 1,000 production sites in 59 countries.
Cargill Meat Solutions acquired Milwaukee Emmpak in 2003 and merged it with Taylor Packing Co. (purchased in 2001). In 2006, Cargill Meat purchased Fresno Meats. The three main brands of beef are Circle T Beef, Valley Tradition, and Meadowland Farms.
On June 1, 2007, CEO Staley was succeeded by Gregory R. Page.
Cargill's quarterly profits exceeded $1 billion for the first time during the quarter ending on February 29, 2008 ($1.03 billion); the 86% rise was credited to global food shortages and the expanding industry that, in turn, caused a rise in demand for Cargill's core areas of agricultural commodities and technology.
In October 2011, the U.S. Justice Department announced that a biotech specialist at Cargill had pleaded guilty to stealing information from Cargill and Dow AgroSciences. Kexue Huang, a Chinese national, was discovered to be passing trade secrets back to China.
In November 2011, Cargill completed the acquisition of Provimi, a global animal nutrition company for €1.5 billion ($2.1 billion US).
On April 1, 2012, Cargill completed a purchase of a cat and dog food plant in Emporia, Kansas. It was previously owned by American Nutrition.
In December 2013 CEO and chairman Page was succeeded by CEO Dave MacLennan.
In December 2014, Cargill finished commissioning a $100 million Indonesian cocoa plant.
In 2015, Cargill wound down its Black River Asset Management division by shutting down four hedge funds, folding two agriculture and energy funds into Cargill, and spinning off three fund businesses to employees to create the hedge fund Proterra Investment Partners, emerging markets debt specialist Argentem Creek Partners and hedge fund Garda Capital Partners.
In 2016, Cargill announced that it would move its Protein Group headquarters from older buildings in downtown Wichita, Kansas, and consolidate into a new building in Wichita's nearby Old Town area. The new $60 million building will be built on the site of the building that formerly housed The Wichita Eagle, following the old building's demolition.
In 2016, Cargill completed the commissioning of a feed plant in Bathinda, Punjab, India, and manufactures dairy cattle feed under the Purina brand name.
In 2017, Cargill sold its Geneva-based petroleum-trading business to Macquarie Bank and soon after its North American power and gas trading business as well.
In 2018, Cargill and Faccenda Foods opened a joint venture to take over their U.K. fresh poultry businesses, Avara Foods, employing 6,000 people.
In February 2018, Cargill completed the purchase of Pro Pet, a pet food manufacturing company. Pro Pet had three manufacturing facilities, one in Owatonna, Minnesota, one in Kansas City, Kansas, and one in St. Marys, Ohio.
In November 2018, Cargill sold its 13 crop input locations in Ontario, Canada to La Coop Fédérée.
In 2018, Cargill made a $25 million investment in Puris, a supplier of pea protein used in Beyond Meat products. In 2019, Cargill invested an additional $75 million.
On April 20, 2020, Cargill temporarily closed its High River, Alberta, plant because "the operation was linked to nearly 500 cases of COVID-19". All 2,100 employees were recommended for virus testing. This plant was responsible for about 36% of Canada's beef producing capacity. On May 6, the plant was connected with 1,560 cases of COVID-19. United Food and Commercial Workers Canada (UFCW) Union Local 401 has recommended the plant's closure since 38 cases were known.
The public health authority of Quebec did not shut down a Cargill plant in Chambly south of Montreal on May 10, 2020. A total of 64 employees, about 13% of the workforce, had COVID-19. The workers are represented by the UFCW. The public health department for the Montérégie region had been working with Cargill since April 25 to deal with the outbreak. Cargill closed the plant on its own.
On May 11, a CBC journalist wrote, "The Cargill plant in Alberta, where there have been about 1,000 reported cases of, is now considered the largest single-site outbreak in North America." Meanwhile, the Agriculture Union of CFIA's embedded inspectors at slaughterhouses said that management is "threatening disciplinary action against employees who refuse to be reassigned to work at COVID-19-infected meat plants", while Deputy PM Chrystia Freeland said, "those who feel unsafe won't be forced back to work."
Also on May 11, the Alberta government disclosed that a second worker from the Cargill plant there had died that day.
On June 3, 2020, Cargill announced that it would no longer publish quarterly results, stopping the disclosures that the company had provided since 1996. Cargill canceled its third-quarter earnings release in March 2020 amid the COVID-19 pandemic.
In December 2021, Croda announces the sale of one of its divisions to Cargill for $1 billion.
In 2022, Cargill announced it would build a corn syrup refinery in Fort Dodge, Iowa.
Apart from sugar and cotton, Cargill India is also one of India's largest originators and marketers of food and coarse grains. It has its own Trade and Structured Finance arm, which also operates the Cargill Capital and Financial Services India Private Limited. Its Cargill Energy, Transport and Metals BU is active across ocean freight, coal, iron ore and steel trading. It bought Sunflower Oil Brand From Wipro In December 2012.
After the government of India, Cargill is India's second-largest buyer of food grain. It has been buying grains and oilseeds in India since 1998. It also has the largest producer of potash, Mosaic.
In January 2019, Cargill announced a $200 million investment to grow business in Pakistan.
In 2019 the NGO Mighty Earth released a 56-page report on Cargill. Mighty Earth chair and former U.S. Congressman Henry A. Waxman called Cargill "the worst company in the world" and said it drives "the most important problems facing our world" (deforestation, pollution, climate change, exploitation) "at a scale that dwarfs their closest competitors."
In 2019, the Swiss NGO Public Eye also criticized Cargill in various contexts in a report on agricultural commodity traders in Switzerland.
Even more recent evidence stems from a 2019 TV program on French channel France 2 about cocoa illegally harvested from protected areas in Côte d’Ivoire. The report found child labor to be widespread on the plantations investigated: every third worker was a child. Instances of child trafficking from neighboring Burkina Faso were also reported. Cargill, which buys from the plantations under investigation, at first denied that it was buying cocoa from protected areas, but was forced to admit that its traceability system had not reached these areas, and therefore that it could not fully trace the origins of its cocoa. Swiss-based food giant Nestlé is one of Cargill's biggest customers of cocoa sourced from Côte d'Ivoire, as later reported by Swiss TV channel RTS 1.
In 2021, eight former child slaves from Mali named Cargill in a class action lawsuit, alleging that it aided and abetted their enslavement on cocoa plantations in Côte d'Ivoire. The suit accused Cargill, along with Nestlé, Barry Callebaut, Mars, Incorporated, Olam International, The Hershey Company, and Mondelez International, of knowingly engaging in forced labor, and sought damages for unjust enrichment, negligent supervision, and intentional infliction of emotional distress.
Cargill's grain—which was dyed red and labeled with warnings in Spanish and English as well as a skull and crossbones design following a previous incident of mercury-treated seed being sold as food in Iraqi markets in 1960—was distributed too late for much of the 1971 planting season, causing many farmers to sell their excess product in the public markets at very low prices; this attracted many poor Iraqis who either could not understand the warnings or disregarded them, causing thousands of cases of mercury poisoning. The long latency period before developing symptoms and cattle's greater tolerance of mercury poisoning also contributed to the mistaken impression the surplus seed grain was safe to eat.
In October 2007, Cargill announced the recall of nearly 850,000 frozen beef patties produced at its packing plant in Butler, Wisconsin that were suspected of being contaminated with E. coli. The beef was sold mainly at Walmart and Sam's Club stores.
In March 2009, the Australian Quarantine and Inspection Service (AQIS) temporarily suspended Cargill Australia's license to export meat to Japan and the US after E. coli was detected in Cargill's export containers from its Wagga Wagga plant. In late April 2009, AQIS lifted Cargill Australia's suspension on its export license.
In August 2011, the USDA and Cargill jointly announced the recall of 36 million pounds of ground turkey produced at Cargill's Springdale, Arkansas, plant due to salmonella fears. The meat recalled was produced from February 20 to August 2. The Centers for Disease Control and Prevention announced that the particular strain of salmonella found was resistant to commonly prescribed antibiotics. One death and 76 illnesses from 26 states were reported. Some 25 types of ground turkey produced under various brand names were affected, and all of the packages in question contained the code "Est. P-963."
In September 2011, Cargill announced a second, immediate and voluntary Class One recall of 185,000 pounds of 85% lean, fresh-ground turkey products because of possible contamination from Salmonella Heidelberg. The turkey was produced at the company's Springdale, Arkansas, facility on August 23, 24, 30 and 31.
In July 2012, the Vermont Department of Public Health said that 10 people in the state had become sick from ground beef being recalled by Cargill Beef. The 10 became sick between June 6 and 26. Three were hospitalized, and all recovered, according to health officials. Hannaford Supermarkets alerted consumers that Cargill Beef was voluntarily recalling 29,339 pounds of ground beef that might contain salmonella. The 85%-lean ground beef was produced at Cargill's plant in Wyalusing, Pennsylvania, on May 25, 2012, and repackaged for sale to consumers by customers of the Kansas-based company.
Greenpeace took its campaign to major food retailers and quickly won agreement from McDonald's along with UK-retailers Asda, Waitrose, and Marks & Spencer to stop buying meat raised on Amazonian soya. These retailers have, in turn, put pressure on Cargill, Archer Daniels Midland, Bunge Limited, André Maggi Group, and Dreyfus to prove their soya was not grown on recently deforested land in the Amazon. In July 2006, Cargill reportedly joined other soy businesses in Brazil in a two-year moratorium on the purchase of soybeans from newly deforested land.
In 2019 the six largest agricultural commodity traders, ADM, Bunge Limited, Cargill, LDC, COFCO Group. and Glencore Agri, committed themselves to monitoring their soy supply chains in Brazil's Cerrado.
The report accused Cargill of endangering the forest habitats of chimpanzees, elephants and other wildlife populations by purchasing cocoa linked to deforestation.Covey, R. and McGraw, W. S. " Monkeys in a West African bushmeat market: implications for cercopithecid conservation in eastern Liberia." Tropical Conservation Science. 7.1 (2014): 115-125.Marchesi, P., Marchesi, N., Fruth, B., and Boesch, C. " Census and Distribution of Chimpanzees in Cote D’Ivoire." PRIMATES. 36.4(1995): 591-607." Poaching contributes to forest elephant declines in Côte d’Ivoire, new numbers reveal." WWF. September 5, 2011. As a result of cocoa production, 7 of the 23 Ivorian protected areas have been almost entirely converted to cocoa.Bitty, A. E., Gonedele, S. B., Koffi Bene, J.C., Kouass, P.Q.I and McGraw, W. S. “ Cocoa farming and primate extirpation inside The Ivory Coast’s protected areas.” Tropical Conservation Science. 8.1(2015): 95-113. Cargill was notified of the findings of Mighty Earth's investigation and did not deny that the company sourced its cocoa from protected areas in the Ivory Coast.
Data released in April 2019 by Global Forest Watch, an online platform providing data and tools for monitoring forests, showed that rates of tropical primary forest loss increased dramatically in 2018 in Ghana and Côte d’Ivoire, primarily due to cocoa farming and gold mining. In 2018 Ghana had the highest rate of increase (60%) in the world compared to 2017, with Côte d’Ivoire (26%) in second place.
In 2006, NatureWorks, a subsidiary in Nebraska, settled with the state over inadequate air pollution controls.
In 2015, Cargill settled with the EPA over Clean Air Act violations in a plant in Iowa.
In its 2018 annual report to the US Securities and Exchange Commission (SEC), Bunge mentioned provisions that suggested the case was still ongoing: "As of December 31, 2018, Bunge's Argentine subsidiary had received income tax assessments relating to 2006 through 2009 of approximately 1,276 million Argentine pesos (approximately $34 million), plus applicable interest on the outstanding amount of approximately 4,246 million Argentine pesos (approximately $113 million])."
In 2022, an inspection into a Dayton turkey factory revealed infractions against the Poultry Products Inspection Act, such as turkeys dying from asphyxiation without being stunned or slaughtered.
New strategy
Countries of operation
Africa
Indo Pacific
Oceania
South Asia
India
Pakistan
Europe
Latin America
Middle East
North America
Meat processing plants
1,200 1,100 950 Beef
Criticism
Child trafficking
Child labor in Uzbekistan
Union busting
Worker safety during COVID-19
Land grabbing
Food contamination
Deforestation
Soy
Palm oil
Cocoa
Air pollution
Tax evasion
Animal welfare
Antibiotic usage
See also
Further reading
External links
|
|