Cargill cutting 8,000 jobs, 5% of global workforce as profits hit lowest levels in nearly a decade

What’s happening at Cargill in Canada?

Cargill, the largest privately held company in the U.S., is reducing its workforce by approximately 5%, or roughly 8,200 positions out of the company’s 164,000 employees worldwide. This decision follows missed profit targets and forms part of the company’s broader 2030 strategy.

A company representative has confirmed to media that Cargill employs over 8,000 people across Canada but has declined to comment on how many Canadians will be affected.

One of its most high-profile Canadian operations is the meat-processing plant near High River, Alberta, which employs roughly 2,200 workers and processes about 4,700 head of cattle per day, according to CBC News.

Key details

• Timeline: Most of the job cuts will occur this year.
• Global Focus: The company will streamline operations, consolidate roles, and reduce redundancies.
• Frontline Impact: Cargill president and CEO Brian Sikes stated that the company aims to minimize the impact on operations and frontline teams.
• Union Response: The president of UFCW Local 401, Thomas Hesse, whose union represents nearly 2,500 workers at two Cargill plants in High River and Calgary, said the cuts appear unlikely to affect Alberta operations. The union is investigating and strongly opposes any layoffs, questioning their necessity.

Official statements and context

Simplifying Operations: CEO Brian Sikes noted in an internal memo, reviewed by Reuters, that less than one-third of Cargill’s businesses met their earnings goals in the last fiscal year.

• He emphasized the need for structural changes to achieve cost efficiencies, including consolidating five business units into three.
• “We have to simplify and streamline our operations, improve the speed and efficiency of our work, and more competitively manage our costs and capital.”
• Cargill can be the world’s most consequential food and agriculture company. And before the end of this decade, we will,” Sikes emphasized.

Union Concerns: Hesse criticized the layoffs, calling for greater transparency and questioning their justification given Cargill’s continued profitability.

• “Everyone knows that it’s an incredibly profitable company,” Hesse said in an interview. “I don’t believe they’re saying they’re not profitable. I believe they’re saying that they’re making less profit … those are two very different statements.”
• Hesse also noted that beef prices have risen significantly in Canada, with ground beef costing $12.96 per kilogram in September 2024, compared to $11.69 the previous year. Striploin cuts jumped to $32.04 per kilogram, up from $27.67 in 2023 and $18.13 in 2019.

Global Crop Surplus and Industry Trends: Depressed prices for corn and soybeans, coupled with the smallest U.S. cattle herd in seven decades, have strained margins in Cargill’s beef processing operations.

• Despite reporting $2.48 billion in profit for the fiscal year ending May 2024, the figure marks a sharp decline from its record $6.7 billion profit in 2021-22.

High River’s History: Cargill’s High River plant made headlines during a COVID-19 outbreak in 2020, with nearly 950 employees testing positive.

• SEE ALSO: Layoffs in Canada: Which Employers are Slashing Staff?

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