Corporate News

Cargill upbeat on 2012 sales of coconut oil, animal feed

Posted on January 27, 2012

FARMING FIRM Cargill Philippines, Inc. expects profits to grow by double-digits this year as it looks to export more coconut oil as well as sell more animal feed, an official said.

“We are anticipating growth. We are expecting to grow by double digits,” Cargill country representative Philip G. Soliven said in a chance interview yesterday.

“We are hoping to grow around 10-20%,” Mr. Soliven said, declining to cite specifics.

This will be driven by the company’s core businesses such as coconut oil and animal feeds production.

“That will be driven by improvements in the animal feed business,” Mr. Soliven said.

“Coconut exports hopefully will be relatively robust this year plus also the fact that we have our activity like processing wheat grains for the animal industry,” he added.

“We want to see an across-the-board growth. And I think everyone believes that economic growth will be better this year than last year due to government spending,” he said.

Coconut oil, which is exported to the United States and Europe, has not been affected by the unhealthy economic conditions in the West, he claimed.

“[This] was not affected because there is demand for coconut oil. It’s a commodity. It was not really a problem,” he said.

The Philippines, according to him, has been a “successful geography for Cargill in the last three years.”

“The business environment has been okay. The politics is stable and the economy has been growing reasonably well,” he said.

Despite the slow growth, he said the county remains to be a venue to grow market share.

“[Here,] you still have the ability to gain market share in the spaces that you are in. It has been a reasonably good three years in the company,” he said.

But the company is not keen on expanding this year as the focus is instead on existing business.

“In the future we may be looking at expansion of other locations but not this year. We are busy growing our existing businesses but there are good opportunities in the Philippines,” Mr. Soliven said.

“We are very bullish in Mindanao and we want to promote more business activities in there,” he added.

The company processes its coconut oil in General Santos City and has an animal feed plant in Cagayan de Oro City.

The company is also exports carrageenan, which is being used for ham and gelatin processing.

Mr. Soliven went on to clarify reports that Cargill is investing in listed firm AgriNurture, Inc. after Black River Capital Partners Fund (Food) LP reportedly bought shares in the listed agribusiness firm.

“There is hedge fund managed by Black River Capital. It is the one looking for an investment for AgriNuture,” Mr. Soliven said.

“The fund itself is owned by Cargill, but the money in the hedge fund is not by Cargill. We don’t have a close association with the planned investment in AgriNurture,” he said.

“It’s a fund investment,” he said. -- Cliff Harvey C. Venzon