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Agricultural giant Cargill has announced a huge round of layoffs, with around 8,000 jobs set to be eliminated globally as the company grapples with declining revenue and market challenges.
The privately held agribusiness plans to cut approximately 5% of its 160,000-strong workforce, marking a significant shift in strategy for the nearly 160-year-old firm. The layoffs, which have been described as part of a broader restructuring, will primarily target corporate roles, aiming to streamline operations and reduce duplication.
Cargill’s President and CEO, Brian Sikes, confirmed the job cuts in an internal memo, emphasizing the need for structural changes amid ongoing financial pressures. “These changes are focused on streamlining our organizational structure by removing layers, expanding the responsibilities of our managers, and minimizing duplication of work,” Sikes wrote.
Tough market conditions
The announcement follows a challenging fiscal year for Cargill. Revenue for the company’s 2024 fiscal year, which ended in May, fell to $160 billion, a sharp decline from a record $177 billion the previous year. With commodity crop prices such as wheat, corn, and soybeans near multi-year lows, profit margins for the agricultural merchant have been squeezed.
Sikes said that less than one-third of Cargill’s businesses met their earnings targets during the fiscal year, prompting the need for decisive action. “Unfortunately, this means reducing our global workforce by approximately 5%,” he said.
Strategic shift
As part of its restructuring, Cargill is consolidating its operations into three primary business units, down from five, as it pursues its 2030 strategic goals. The company has stated that the changes are aimed at empowering frontline teams to deliver better results for customers while minimizing disruptions to its operational workforce.
In August, Cargill hinted at the restructuring when it outlined plans to simplify its business model after falling short of internal earnings goals. At the time, the company highlighted that operational efficiency would be a key focus moving forward.
The layoffs are expected to unfold over the coming months, with the most significant impacts occurring this year. Sikes assured employees that affected staff in countries where immediate action is possible would be informed this week through dedicated meetings to explain the next steps.
Cargill will hold a company-wide meeting on December 9th to provide more details about the restructuring process and its implications.
Industry under pressure
Cargill’s move comes against the backdrop of mounting challenges faced by global agricultural trading houses as commodity markets fluctuate and margins tighten. Rivals in the sector have also grappled with similar issues, raising questions about the resilience of traditional agribusiness models in an increasingly volatile market.
Despite the cuts, Sikes expressed confidence in the company’s future. “These changes are difficult but necessary to position Cargill for sustainable growth and continued leadership in the agricultural sector,” he stated.
The news comes as farmers across the US urge the incoming Trump administration to reconsider its hardline stance on immigration, warning that deporting undocumented workers could create a labor shortage which would cripple the agricultural sector.
Nearly half of the approximately two million US farmworkers lack legal status, according to government data. Industry groups warn that mass deportations, a key promise of President-elect Donald Trump’s campaign, could disrupt farming operations, drive up grocery prices, and devastate rural communities.
