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Our Work

Cargill in Brazil
In spite of a challenging scenario, Cargill had an excellent performance in 2014, increasing its consolidated net earnings by 26 percent.
Cargill employee in the Mairinque (SP) plant.

Economic context

In 2014, the Brazilian economy felt the delayed impact of the world economic crisis that especially troubled developed nations in 2008. The year ended with growth and inflation of 6.4 percent, close to the upper limit of the inflation band. In such a situation, tax stimuli are limited, credit is restricted, interest rates must be raised, and new jobs are sparse.

On the other hand, the Brazil Consumption Potential Index (IPC Maps 2014) considered that household expenses will increase above the GDP, which suggests a scenario with a growing economy driven by the middle class, which accounts for 50.8 percent of all consumption. Basic items increased the most, especially staple foods (16.5 percent): 10.3 within the home, 5.1 percent outside the home, and 1.1 percent in beverages.

The Brazilian agribusiness grew 1.59 percent in relation to the prior year, according to the Brazilian Confederation of Farming and Livestock (CNA) and the Center for Advanced Studies in Applied Economics (Cepea) of ESALQ/University of São Paulo (USP). In spite of being modest in comparison with 2013 growth (5.22 percent), this figure is still quite positive considering the overall growth of the country’s GDP and a drop in agribusiness, particularly in the second half of the year.

Visita ao campo 
de soja em Uberlândia (MG).
Visiting a
soybeans field in
Uberlândia (MG).

Even in such challenging settings, Cargill had excellent performance in 2014, increasing its consolidated net profit by 26 percent to R$481 million, in comparison with the R$382 million earned in 2013. Total company indebtedness fell by 6 percent in relation to the prior year. The volume of products originated, processed, and traded by the company totaled 21 million metric tons. Out of this total, 78 percent was exported and 22 percent was sold locally.

Operating performance

Our achievements in 2014 result from the permanent pursuit of operational efficiency and they confirm our commitment to develop solutions for our customers. By opening new plants, expanding existing facilities, launching products, and entering into new commercial agreements, Cargill reaffirms that Brazil remains a safe haven for major investments.

Innovation in the ethanol industry

In Quirinópolis (GO), Cargill started construction work to upgrade Usina São Francisco, a sugar and ethanol mill owned by SJC, its joint venture with the USJ Group. The R$160 million project includes construction of a plant to process corn into ethanol. This is an innovative decision for the ethanol industry, which has been driven by the fact that sugarcane is a seasonal crop that leaves mills idle for at least four months in the year. By processing corn into ethanol, the mills will be able to maximize their production capacity over the entire year. Additionally, this initiative will encourage farmers to plant another crop during the sugarcane off-season.

Unidade de processamento 
de milho em Castro (PR).
Corn processing plant
in Castro (PR).

Innovation in tomato products

The search for maximum efficiency of the supply chain has driven Cargill to develop a solution using skins and seeds left over from tomato processing. What was formerly a residue is now an ingredient for animal nutrition. Cargill has been the first company in Brazil to be certified by the Brazilian Ministry of Agriculture to market this product. Over 7,000 metric tons were sold in 2014.

Brazil’s first biorefinery

In 2014, Cargill opened the first corn biorefinery in Brazil, in the municipality of Castro (PR). The grand opening was attended by more than 600 people, including employees, customers, local business leaders, and authorities. The company invested over R$450 million in the facilities, which combine installations, equipment, and processes to convert biomass into refined products, in partnership with other companies around the site. This is a very innovative approach in Brazil. The complex is one of Cargill’s biggest investments worldwide, which signals the potential of emerging markets like Brazil and other Latin American countries. By 2020, four partner companies will be installed at this site. One of these companies is Evonik, which is already in operation.

Shared Services Center

In 2014, Cargill concentrated financial, accounting, tax, and administrative activities in the Shared Services Center in Uberlândia (MG). The structure follows global standards – Cargill Business Services (CBS) – for process optimization, rendering operations more efficient. About 100 employees are already working in this Shared Services Center, a number that should increase to 250 by late 2015, when it will also house human resources, information technology, and procurement services.

New joint venture

Cargill and Copersucar, a Brazilian trader of sugar and ethanol, received all regulatory clearances to form Alvean in 2014. The new joint venture is a 50/50 partnership between the two companies and will originate and trade raw and refined sugar on a global basis. The operation will be based in Geneva, Switzerland, and will have offices in Brazil, China, United Arab Emirates, Spain, India, Indonesia, Russia, and Thailand.

Click here for more information.

Expansions

Throughout 2014, Cargill invested heavily in its production lines to boost operational efficiency. The company has increased production capacity of refined oils and vegetable fats at the Itumbiara (GO) and Mairinque (SP) plants. It has also started investing R$240 million to expand the Santarém (PA) river terminal. The upgrade will increase annual shipping capacity from two to five million metric tons.

In November 2014, authorities issued the installation license for the Cargo Transshipment Station (ETC) in the Miritituba district of Itaituba (PA), an investment of R$200 million.

New products

New products were added to the tomato line in 2014. To celebrate the FIFA World Cup happening in Brazil, the Elefante brand of tomato paste was sold with a special packaging. The 130 g and 140 g cans featured dedicated artwork with the famous elephant character, Jotalhão. Brazil’s favorite elephant was also present in the celebration of the Farroupilha Revolution, in the state of Rio Grande do Sul. A special edition of the 340 g can distributed only in Rio Grande do Sul featured Jotalhão wearing the typical gaucho trousers.

In order to provide better-balanced food, Cargill reduced the amount of sodium and calories in the Pomarola Lévia product line. Packaging was also redesigned to have a fresher look

The company also launched the Receitas +, which combined two well-known and well-liked brands by adding Gallo olive oil to Pomarola tomato sauce.

The Tarantella line of tomato products also expanded its portfolio in 2014. The brand introduced a fine herbs flavor and added a new product to its line, tomato paste.

As part of its strategy to expand in the food service category, Cargill now sells Pomarola, Tarantella, Elefante, and Pomodoro products through that segment.

Revitalization

In partnership with ConAgra Foods, one of North America’s largest food companies, Cargill is now distributing Hunt’s condiments, including ketchup, mustard, barbecue sauce, and Act II microwave popcorn. The Hunt’s line is produced in the United States and Act II popcorn is produced in Brazil. By distributing these products, Cargill is offering Brazilian consumers high-quality products and two brands that are leaders in several countries.

Solutions for the customer

Every year, Cargill reinforces its commitment to thrive alongside its business partners across different industries. In 2014, for instance, it helped CPFL Energia, an energy utility, migrate its distribution network to green electrical transformers that use Envirotemp™ FR3™ vegetable fluid. In addition to being less harmful to the environment, the Cargill vegetable fluid performs better than mineral oil and has a fire point twice as high as regular fluids, which improves fire safety.

The company has also invested in a fleet of vehicles to ensure quality delivery of soybean meal at BRF’s feed plant in Uberlândia (MG). This project was supported by Cargill Transportes, which was established in 2013 to improve and optimize company logistics. The initiative to serve customers using Cargill’s own fleet of trucks is based on four pillars:

Food Safety | The use of new trucks, dedicated to BRF, and strict cleaning standards have reduced the possibility of product contamination during transportation.

Service Level | A logistics team focused on productivity metrics ensures uninterrupted supply to the client.

Safety | Trained drivers and safety equipment provide high levels of personal and property safety.

Sustainability | Double trailer trucks can carry a net cargo of 47 metric tons and use advanced diesel engines, which ensures lower emission of greenhouse gases per ton transported.

Supported by Scania, a truck manufacturer, Cargill selected the drivers using an award system (MMCB). The selected drivers attended safety workshops and a special training program provided by Fundação Adolpho Bósio de Educação no Transporte (Fabet). The purpose was to train drivers and transmit the company’s partnership culture. Additionally, Cargill trucks are fitted with telemetric tracking systems, which lets management monitor each phase of the operation (loading, travel, and unloading) and adds operational efficiency and safety.

Linha de produção da fábrica de São José do Rio Pardo (SP).
Production line in the
São José do Rio
Pardo (SP) plant.
Produtos Elefante
Thanks to innovation and partnerships, new products and brands arrived on Brazilian supermarket shelves in 2014.
Frota própria para o transporte de farelo de soja em Uberlândia (MG).
Cargill’s fleet of trucks
transporting soybean
meal in Uberlândia (MG).