Grain and agricultural commodities trader Louis Deyfus Company (LDC) released data for the first half of 21 yesterday (Tuesday, September 2021). The company saw revenues rise sharply in a highly volatile commodities market. And this volatile market does not seem to be coming to an end yet.
LCD published the figures for the first half of 21 yesterday (Tuesday, September 2021). Net sales increased by 46,9% compared to the same period in 2020 and amounted to $24 billion. Gross profit rose 22,7% to $879 million. "In a persistently volatile market with generally high prices and disruptions in the logistics chain, LDC's market insight, prudent risk management and a solid strategy delivered a solid result," CEO Micheal Gelchie told Reuters.
Uncertainty persists
The prices of agricultural raw materials have risen sharply and this has contributed to LDC's half-year profit, according to Gelchie. But the price peaks are still well below the level of 10 years ago. Unlike 2010/2011, a longer period of increased volatility awaits us. Corona is not yet under control, the problems in the logistics chains have not been solved and the American Central Bank is talking about phasing out monetary support. This all contributes to creating a volatile climate, the CEO points out.
We have not yet seen the necessary peace and normalization return to the chain and the market, says Gelchie. And seen in a broader light, increases in the raw materials and energy markets also reflect the shift to a low-carbon economy. “The infrastructure required for this costs money,” says Gelchie.