Monsanto announced Wednesday that it will cut 2,600 jobs as part of a cost-savings strategy prompted by a decline in its global seed and herbicide sales.
The job cuts will come throughout the next two years.
Financial filings show that the company reported a $495 million loss in its 2015 fiscal year’s fourth quarter. That amount is more than three times the loss compared to the same quarter the previous year.
Monsanto’s fiscal year concludes at the end of August each year.
Job cuts are expected to save the company about $400 million. Ultimately, the cuts will reduce the company’s workforce of roughly 22,500 employees by about 12 percent, according to the Associated Press.
“Despite weakening global currencies and commodity prices we continue to view this as a time of opportunity,” Monsanto CEO Hugh Grant said on a conference call, according to an Associated Press article published via U.S. News & World Report.
The U.S. News & World Report published on Oct. 7, 2015:
Monsanto has struggled in recent quarters to deal with slumping corn prices in the U.S., which have reduced demand for its best-selling product: genetically-enhanced corn seeds. Farmers are shifting more acres to other crops due to a surplus of corn from last year’s harvest.
Similar to Monsanto, other agribusiness companies have also not faired well financially due to an overall decline in U.S. crop prices.
Earlier this week, DuPont CEO Ellen Kulhman announced her retirement the same day the company lowered its earnings outlook for the year.
The Wall Street Journal reported on Oct. 5, 2015:
DuPont directors were increasingly concerned about the company’s share price and disappointing results, according to Jeffery Sonnenfeld, a senior associate dean at Yale School of Management, citing a conversation with a senior DuPont official on Monday.
Despite these other agribusiness companies’ profits faltering, Minneapolis-based Cargill has managed to turn a 20-percent gain in its 2016 fiscal year’s first quarter.
Financial statements filed by the privately held company show that net earnings for Cargill’s first quarter were $512 million, an increase from 2014 when it netted $425 million in during the same quarter.
Cargill’s current fiscal year runs through the end of May.
“Our team ably navigated the quarter’s weather-driven agricultural commodity markets, as well as the effects of more volatile emerging markets, currency fluctuations and other macroeconomic uncertainty,” Cargill CEO David MacLennan said.
The processing arm of Cargill made the greatest contribution to Cargill’s first quarter earnings, according to a company press release.
“Soybean crush results strengthened globally, boosted by improved utilization in South America and an unusually long processing season in North America,” the company reported.