"Cargill's ratings reflect its competitive position as the largest agricultural company based in the US and one of the biggest privately owned companies in the world," Fitch said. "Its operations span every major country and almost every agricultural commodity. Key agricultural operations include oilseeds processing, corn milling, meat processing, and animal nutrition.
“The ratings incorporate Cargill's extensive geographic and product line diversification, which lessens operating earnings volatility during most years,” the ratings agency added.
Fitch said the negative outlook reflects Cargill's disappointing earnings in fiscal 2012. The company reported a 56 percent decline in earnings from continuing operations to $1.17 billion in fiscal 2012, down from record high earnings in 2011, according to Fitch. Reduced profits in US beef; global soybean processing and asset management hurt the company's earnings. Losses in cotton and sugar also had a negative impact.
Lower earnings coupled with the divestiture of the company's $19 billion equity stake in The Mosaic Company (Mosaic) in May 2011 have weakened Cargill's credit profile, Fitch said.
