Big Ag: Cargill Floats $1 Bil. in Notes, Fitch Says it May Take Some Time To Get Over 'Rough Start' to Fiscal Year

From AgriMoney:

Cargill's recovery from a "rough start" to its financial year could be hampered by elevated livestock and feed prices, Fitch analysts said, underlining concerns which have led them to threaten a ratings downgrade.

Fitch, assigning an "A" rating to $1bn of Cargill notes issued on Tuesday to refinance maturing debt, blamed "multiple factors" for a 78% tumble to $336m in the agribusiness giant's earnings in the June-to-November half.

These included hits from higher livestock and feed costs on animal processing operations, the influence on commodity markets of political decisions which were difficult to anticipate, and a "weak" performance in sugar, in which Cargill replaced its divisional head in December.

Live cattle futures, for February, hit a fresh record high for a spot contract of 129.775 cents a pound in Chicago on Wednesday.

Fitch warned that some of these setbacks "could linger and hinder a recovery in Cargill's earnings", which for the September-to-November period represented the weakest quarterly figure in a decade...MORE

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