Agribusiness Cargill Inc. on Wednesday said its CEO will step down on Dec. 1 in the latest management shuffle among the world’s top agricultural trading houses.
Gregory Page, 62, will be replaced by David MacLennan, Cargill’s president and chief operating officer, as part of the company’s ongoing succession plans, the company said.
MacLennan told Reuters that Cargill will keep on the same path set under Page’s leadership, focusing on investments outside of North America while expanding their energy business to include more physical trade.
“Overall, we like our mix of hard asset businesses, primary and secondary processing, value-added foods, trading relative to risk management for our customers and our own businesses,” he said.
MacLennan added that he does not see a change in the business mix of trading relative to processing “other than energy.”
Minneapolis-based Cargill is one of the world’s largest privately held corporations and a top commodities trader. It reported earnings of $2.31 billion for the fiscal year that ended May 31, compared with $1.17 billion a year ago (all figures US$).
Cargill, a leading global grains exporter, is among the four “ABCD” companies that dominate the flow of agricultural goods around the world, along with Archer Daniels Midland, Bunge and Louis Dreyfus. In Canada, Cargill is the third-largest grain handler, as well as the country’s top beef packer.
The chief executives of Louis Dreyfus Commodities and Bunge stepped down this summer. Cargill in May also named a new president, Jeff Vassart, for its Canadian arm, Cargill Ltd., to replace the retiring Len Penner.
MacLennan said he sees Cargill’s greatest growth opportunities in Brazil — as the country expands crop production and shipping infrastructure — and in Africa and China where demand for food will continue to rise.
“Seventy-five per cent of our capital in the last five years have been invested outside the United States,” MacLennan said. “It will continue to be more outside of North America rather than inside of North America.”
MacLennan, 54, joined Cargill in 1991 and has worked in its financial, risk management, energy and animal protein businesses in the United States, London and Geneva. He became president and COO in 2011.
“The challenge is navigating a world that has a lot of volatility,” MacLennan said.
Volatility has been a factor in Cargill earnings in recent years, most notably fiscal 2012 when profits fell 56 per cent to $1.17 billion as Cargill was squeezed by soft economies and market volatility.
Company officials said the leadership change was not related to recent volatility and noted the 148-year-old company had record earnings five out of the last six years with Page at the helm.
Page, who has worked for Cargill for 39 years and is stepping down before Cargill’s mandatory retirement age of 65, will become the company’s executive chairman. In that role, Page will lead the board and be a resource to the company.
MacLennan will be unique among Cargill’s CEOs because he did not rise through the ranks of managing Cargill’s traditional businesses such as grains or oilseed processing, said Ken Morrison, a trader who worked for Cargill for 27 years.
Morrison, who now publishes a commodity newsletter, said he worked with MacLennan in Cargill’s financial markets division in Minneapolis.
MacLennan has “a very positive balance of experience,” Morrison said. He has developed “a solid sense of Cargill’s culture and business, probably throughout his entire life,’ Morrison said.
Cargill remains privately held by descendants of the founders from the Cargill and MacMillan families.
Asked if Cargill will go public in the near future, MacLennan said: “No. The families’ commitment to staying private is unchanged.”
— Christine Stebbins and Tom Polansek report for Reuters from Chicago. Includes files from AGCanada.com Network staff.