Cargill, the largest private company in the U.S., is trimming its global workforce as it faces pressure related to lower commodity prices.
The Minnesota-based company, which is also one of the world’s largest globally active agricultural commodity traders, told FOX Business that approximately 5% of its workforce are being laid off. That equates to about 8,000 jobs.
Cargill said the layoffs are part of a "long-term strategy" that the 160-year-old company laid out earlier this year.
"As we look to the future, we have laid out a clear plan to evolve and strengthen our portfolio to take advantage of compelling trends in front of us, maximize our competitiveness, and, above all, continue to deliver for our customers," the company said in a statement.
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It comes at a time when prices for commodity crops like wheat and soybeans have softened, threatening profit margins for the industry.
According to the World Bank, commodity prices fell 4% in the third quarter of 2024 compared with the prior quarter. There were declines across most categories, except for fertilizer and precious metals. The World Bank projected that commodity prices are expected to decline by 5% in 2025 and 2% in 2026.
The World Bank’s aggregate commodity price index is projected to reach its lowest level since 2020.
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"As the world around us changes, we are committed to transforming even faster to deliver for our customers and fulfill our purpose of nourishing the world," Cargill said, adding that in order to "strengthen Cargill’s impact, we must realign our talent and resources to align with our strategy."
Since the company is privately held, it does not publicly release quarterly earnings statements. However, the company said in a memo seen by Reuters in August that less than one-third of its businesses met their earnings goals in the prior fiscal year.
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After missing earnings goals, the company said it would undergo structural changes. This includes condensing operations from five to three units.
CEO Brian Sikes said in the internal memo that the company will hold a meeting on Dec. 9 to share more information about its restructuring plans.
Reuters contributed to this report.
