(Adds details, background, full-year results, byline)
By Karl Plume
Aug 7 Cargill Inc, a top global
commodities trader, said on Thursday its quarterly earnings fell
as drought limited farm services opportunities in the United
States and due to a loss stemming from the drop in the value of
Minneapolis-based Cargill was also stung by elevated rail
shipping costs and railcar shortages in the northern U.S. Plains
states, which have similarly impacted rival agribusinesses
Archer Daniels Midland Co and Bunge Ltd.
Privately-held Cargill reported net earnings of $424 million
for the fiscal fourth quarter ended May 31. That was down 12
percent from $483 million in the same quarter a year earlier.
Revenue rose 2 percent to $36.2 billion in the quarter,
compared with $35.4 billion a year earlier.
The company's full-year fiscal 2014 earnings declined 19
percent to $1.87 billion while revenues slipped 1 percent to
Cargill was the latest U.S. corporation to be hurt by the
drop in value of Venezuela's bolivar, joining the likes of
Colgate-Palmolive, Fiat Chrysler, Goodyear Tire
& Rubber and numerous U.S. airlines. Critics have called
the country's revamped exchange rate system a devaluation in
It also said that earnings in its food ingredients and
applications business declined after four straight years of
record profits due to weaker economic conditions in some markets
and the negative Venezuelan currency impact.
Results from Cargill's origination and processing segment -
which buys, sells, stores and transports agricultural products -
slipped on the lingering impact of the drought in the U.S.
Plains as well as rail shipping woes.
Rail carriers in the northern United States and Canada have
struggled to recover from severe winter service delays caused by
harsh weather as demand for shipping oil by rail has soared.
Canada's government ordered the country's key railways to
ship at least 1 million tonnes of crops a week to clear a grain
backlog ahead of the fall harvest while the U.S. Surface
Transportation Board has ordered railroads to report weekly
grain shipping performance.
Cargill's beef business was a bright spot as a downturn in
feed costs boosted North American cattle feeding margins and
beef exports from Australia were brisk. But the company, one of
the largest U.S. beef processors, has closed plants in Wisconsin
and Texas over the past year as the U.S. cattle herd shrunk to
the smallest in 63 years.
Pork and poultry results improved from a year ago.
Earnings in industrial and financial services were mixed,
the company said, with poor results in energy more than
offsetting stronger profits in its ocean shipping business and
gains from a joint steel-making venture.
(Reporting by Karl Plume in Chicago; editing by Jeffrey Benkoe,