Louis Dreyfus Company (LDC), one of the world's largest crop merchants, said its first-half net profit and sales fell from a year earlier, when results were boosted by upheaval linked to the war in Ukraine.
LDC, whose rivals include ADM, Bunge and Cargill, reported a group net profit of $568 million (€538.3 million) for the first half of 2023, compared with $662 million (€627.4 million) in the year-earlier period. Net sales fell to $25.8 billion (€24.5 billion) from $30.3 billion (€28.7 billion).
Volatility in most of its markets eased compared with the previous year while prices fell except for robusta coffee, sugar, rice and citrus juices, LDC said in a financial report.
Volatility fuelled by Russia's invasion of fellow grain exporter Ukraine had buoyed profits for crop merchants as they used their global networks to manage supply disruptions and meet firm global food demand.
ADM and Bunge reported a drop in second-quarter profits from record year-earlier levels, though the firms each raised full-year earnings guidance, with a bumper Brazilian harvest for corn and soybeans supporting processing margins.
LDC similarly cited the big Brazilian crop, together with strong Chinese demand, as helping its grain and oilseed business that was a driver of first-half performance.
In Russia, LDC stopped exporting Russian grain from 1 July as planned and was continuing to study options to transfer its existing Russian business and grain assets to new owners, it said.
“While international trade flows progressively adapted to last year’s turbulent environment, some challenges persisted into 2023 – a context in which LDC pursued its focus on keeping essential food, feed, fibre and ingredient supply chains moving safely, reliably and responsibly,” said Michael Gelchie, LDC’s chief executive officer.
“Leveraging our expertise, diverse portfolio and global network, we successfully navigated a still uncertain and complex market to deliver resilient performance for the first semester, supported by recent developments and investments in asset improvements, in line with our strategic growth plans.”
News by Reuters, additional reporting by ESM.