Global agribusiness giant Louis Dreyfus Company (LDC)’s net sales and income dropped in the first six months of this year compared to 2023 due to persistent geopolitical, macroeconomic and environmental challenges.
In the six-month period to 30 June, the company announced net sales of US$25.6bn, segment operating results of US$1,284M, with positive contributions from both business segments, and EBITDA at US$1,057M. This compared to US$25.8bn, US$1,316M and US$1,169M respectively in the same period last year.
Capital Expenditure was up 30% year-on-year as the Group continued to invest as part of its strategic plans to reinforce and diversify its business portfolio, geographic presence and network, the company said on 20 September.
“In a global trade environment marked by logistics challenges from new and ongoing geopolitical crises that disrupted trade flows and maritime shipping routes, changeable import demand dynamics and uncertain crop size prospects influenced by weather conditions, LDC grew its volumes shipped by 19.4% year on year,” the company’s CEO Michael Gelchie said.
“[We] deliver[ed] strong results for the first semester of 2024, as an overall recovery in crop sizes and ample stocks globally put pressure on prices and resulted in less volatile market dynamics compared to the first half of 2023.”
The Value Chain segment’s operating results increased from US$919M in 2023 to US$941M although the Grains & Oilseeds Platform had lower results despite higher volumes sold.
The wheat business contributed to the segment’s performance with higher volumes sold, supported by a larger crop in Argentina and further diversification of LDC’s origination and destination markets, the company said.
Despite higher volumes sold compared to the same period in 2023, the company said its soyabean and corn businesses were negatively impacted by fewer opportunities in a context of lower volatility, combined with lower crushing margins in China.
Processing margins decreased in North America due to ample feedstock and biofuel availability weighed on prices during the period.
The Group said it had continued to invest in core merchandising activities, with the construction and expansion of crushing capacity in North America to support core and new product lines, and the pursuit of its downstream diversification plan, including the launch of its updated Vibhor edible oils brand in India.
