
Food security – the challenge of feeding the world – has recently raised to the top of the G20 agenda. The UN says that billion people go to bed hungry every night, and that we need to double food production by 2025 just to keep up with population growth and better diets in the developing world – grim truths that concern Cargill deeply, whether Cargill believes that solving world hunger is its job or not. “We are not philanthropy’ says Greg Page “I think we have to be careful not to lay claim to an altruism that doesn’t exist.”
Mr. Greg Page does not disagree, although his take may surprise you “Clearly the volatility can be an opportunity” he says, acknowledging that sharp price swings can play Cargill’s vaunted trading expertise. Then he adds “the big part of our business is the physical handling of tens of millions of tons of food. If we believe that world is headed toward a varied weather pattern, those services become more important.”
In other words, signs point to Cargill’s influence – and profits – continuing to grow. But is what’s good for Cargill good for the world?
Cargill’s impact on our daily lives; you don’t have to love Egg Mac Muffins (MacDonald’s buys many of its eggs in liquid form from Cargill) or hamburgers (Cargill’s facilities can slaughter more cattle than anyone else in the U.S.) or sub sandwiches (No. 8 in pork, No. 3 in turkey) to ingest Cargill products on a regular basis. Whatever you ate or drink today – a candy bar, pretzels, soup from can, ice cream, yoghurt, chewing gum, beer – chances are it included a little something from Cargill’s menu of food additives. Its US$ 50 billion “ingredients” business touches pretty much anything salted, sweetened, preserved, fortified, emulsified or texturised, or anything whose raw taste or smell had to be masked in order to make it palatable.
Cargill’s big acquisition agenda, completing deals for a Central American poultry and meat processor, a German chocolate company, an Italian feed company, and the grain business of AWB, formerly the government-owned Australian Wheat Board – Mr. Greg Page says “the US$ 1.3 billion AWB purchase fills a hole in Cargill’s global grain network: “We are in Russia, We are in Ukraine, We are in Canada, We are in the U.S. We are in Argentina, and we just didn’t have as vibrant a footprint there.”Cargill also has a pending US$ 2.1 billion offer for Provimi, a global feed company with 7,000 employees in 26 countries; the deal is expected to close by year-end.
Mr. Greg Page may not be under pressure from the family shareholders, but that doesn’t mean that he is unworried about the future. The real threat to Cargill’s long-term prosperity, Page says “is that forces beyond the company’s control will infringe on its freedom to operate across markets.” Cargill is clearly concerned with the way the global conversation is bending on food security. “You don’t end up with policies that are counterproductive to feeding everyone,” says Page, “and we don’t want to end up with a business model that doesn’t have any freedom to operate.” Trust us, he’s saying, to feed the world, to keep our food safe, to respect the environment, and, by the way, to not gouge farmers or food shopper at the supermarket. That’s asking a lot. Greg Page is keeping a weather eye out. We’d better do the same.
Sources: All the 3 post on Cargill is summarized from an article in Fortune India magazine of January 2012










