Industryweek 34246 Cargill Soy 1

Cargill Plans to Work With Farmers on Save-the-Forest Initiative

Feb. 23, 2019
“We’ve done an assessment of our various high-risk supply chains and we’ve said ‘You know what? We want to make sure what we say and what we do are consistent’,” said Ruth Kimmelshue, Cargill’s senior vice president of business operations and supply chain.

Cargill Inc., the world’s biggest agricultural company, plans to provide more transparency on its supply chain to customers and climate-change wary consumers in response to global concerns over deforestation.

America’s largest privately-held company has created a “sustainability hub” that will work with farmers in high-risk areas involving the crop's expansion for soybeans, cocoa and palm oil, executives from the Minneapolis-based company said. Cargill is also looking at ways to improve human-rights issues through its business practices.

“We’ve done an assessment of our various high-risk supply chains and we’ve said ‘You know what? We want to make sure what we say and what we do are consistent’,” said Ruth Kimmelshue, Cargill’s senior vice president of business operations and supply chain. “So we’ve taken the step to formalize in writing what our intention is and also a way to reflect what our actions are.’’

Cargill is one of the biggest buyers and processors of farm crops, with about 155,000 employees across 70 countries. As part of the initiative, Cargill will create metrics that will determine a baseline, and measure farmer progress moving forward and is expecting to issue an action plan by June 15.

The company is the “C” of the vaunted, “ABCD’s” of agriculture, along with Archer-Daniels-Midland Co., Bunge Ltd. and Louis Dreyfus Co. Cargill has bought and sold crops since 1865.

As the world’s population swells and more people adopt middle-class diets, demand for meat is expected to increase. Soybean-based products are used to feed livestock, giving an incentive for farmers in places like South America to expand acreage. That threatens native vegetation in areas like Brazil’s Cerrado savanna.

Meanwhile, consumers are increasingly curious about how their food is sourced and handled as it weaves from farms to grocery store aisles.

The company plans to issue an action plan by June 15. The initiative is the culmination of some of Cargill’s already existing practices, Devry Boughner Vorwerk, Cargill’s vice president of global corporate affairs, said in the telephone interview.

Sustainability issues are also tied to broader macro forces, they said. While this initiative was already in the works prior to the trade tensions between the U.S. and China, the spat underscores the potential for unintended consequences, they said.

China imposed retaliatory tariffs on U.S. farm goods, including soybeans. As a result, the world’s biggest buyer of the oilseed has increasingly sought South American supplies. That could send a signal for acreage expansion in the region.

“I was just down in Brazil last week,” Kimmelshue said. “It’s a real situation in terms of as the market moves it creates incentives for actors to behave in a certain way. And what it really highlights is the unintended consequence that we don’t always understand or that we don’t always consider.”

 By Mario Parker and Javier Blas

Popular Sponsored Recommendations

Decarbonizing Your Supply Chain: Striving for Net Zero

Feb. 12, 2024
Manufacturers face mounting pressure to decarbonize operations and supply chains. Meeting regulatory goals demands bold action and transparency. Collaboration with suppliers offers...

Optimizing Connected, Resilient Supply Chains in 2024

Dec. 19, 2023
Discover how manufacturers fortify supply chains amidst change, explore the 2024 manufacturing industry outlook and delve into Gen AI for resilient supply chains.

6 Ways Manufacturers Can Use GenAI Today

Feb. 1, 2024
Hear six compelling use cases where generative AI is making a significant impact in augmenting frontline workers and transforming operations. Learn how GenAI Assistants and smart...

Smart Factory Impact on Manufacturing KPIs

Feb. 1, 2024
Explore the transformative power of Smart Factory solutions beyond OEE metrics. This whitepaper outlines the untapped potential, revealing how a holistic approach can elevate ...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!