Gregory Meyer in New York
Cargill, the world’s largest agricultural commodities trader, has parted ways with the head of its $2bn cotton division amid tough market conditions.
Doug Christie, president of Cargill Cotton since 2009, stepped down and left the company this month, he confirmed in an email. Neither he nor Cargill said why he departed.
US-based Cargill competes with companies such as Louis Dreyfus, Glencore,Olam and Cofco Agri to buy bales from farmers around the world and export them to textile mills.
The market has been “difficult” for merchants, said Bill May, president of the American Cotton Shippers Association, where Mr Christie was a board member.
A period of soaring demand and wild prices has been followed by a long stretch of stagnation, with the benchmark ICE US cotton contract hovering between 55 and 68 cents per lb for the past year and a half.
China, the worldΆs biggest cotton consumer with a vast textile sector, has indicated plans to sell off a state stockpile, driving down demand for imports. International trade in cotton has shrunk 25 per cent in the past three years to 35m bales, the US Department of Agriculture estimates.
Louis Dreyfus, whose Memphis-based Allenberg Cotton company is the leading cotton merchant by volume, noted “reduced” returns from cotton last year.
“During 2015, the cotton market saw contracted world trade with little price volatility,” its annual report said.
Swiss-based Glencore described a “relatively quiet” market last year, though itscotton division — led by former Cargill trader Colin Iles — performed well.
Cargill cited “weaker performance in cotton” as a factor behind a fall in operating profit in its latest quarterly results.
Mr ChristieΆs LinkedIn page said he was responsible for a $2bn global cotton business with “commercial activities in virtually every country producing or consuming cotton globally”. He previously oversaw CargillΆs soft-seed and biodiesel operations in the US and Canada, the page said.
Cargill said Mr Christie had left the company after 29 years. It has not announced his replacement. “In terms of plans for the [cotton] business, they remain the same in terms of helping growers and buyers,” it said.
CargillΆs website said the company had “experience buying cotton in 22 countries and selling in 35”, with local teams procuring bales from the US, Brazil, west and south-east Africa, India and Australia.
