Cargill

Decision Points

Cargill, Incorporated is a privately held, multinational corporation, based in suburban Minneapolis, Minnesota in the United States. Founded in 1865, it is now the nation's largest privately held corporation (in terms of revenue). If it were a public company, it would rank in the top 10 companies in the Fortune 500. Cargill's business operations include purchasing, processing, and distributing grain and other agricultural commodities, and the manufacture and sale of livestock feed and ingredients for processed foods and pharmaceuticals. It also operates a large financial services arm, which manages financial risks in the commodity markets for the company. In 2003, it split off a portion of its financial operations into a hedge fund called Black River Asset Management, with about $10 billion of assets and liabilities. It owns 2/3 of the shares of The Mosaic Company, one of the world's leading producers and marketers of concentrated phosphate and potash crop nutrients.

Cargill declared revenues of 116.6 billion USD, and earnings of 3.33 billion USD in the 2009 fiscal year. Employing over 160,000 employees at 1,100 locations in 67 countries, it is responsible for 25 percent of all United States grain exports. The company also supplies about 22 percent of the United States domestic meat market, exporting more product from Argentina than any other company and is the largest poultry producer in Thailand. All of the eggs used in McDonald's restaurants in the United States pass through Cargill's plants. It is the only producer of Alberger process salt in the U.S.A., which is highly prized in the fast-food and prepared food industries. It operates a unique (and antique) plant in St. Clair in the Thumb of Michigan.

Cargill remains a family-owned business, as descendants of the founder (from the Cargill and MacMillan families) own over 85% of the company. As a result, most of its growth has been due to reinvestment of the company's own earnings, rather than public financing. Greg Page is the chief executive officer of Cargill; he succeeded Warren Staley in mid 2007.

Cargill's long-term business strategy is to shift its business from trading and processing large volumes of agricultural commodities, to higher margin activities. One of them is the research and development of advanced processing techniques, particularly at its plant in Eddyville, Iowa. For example, in a joint venture with Hoffman-LaRoche, it has developed a process for converting a waste by-product of soybean oil refining into vitamin E. It also produces fuel-grade ethanol, citric acid, and phytosterol esters from grain. The company intends to work as consultants for its customers to create new ingredients and new food processing methods.