BUENOS AIRES/CHICAGO (Reuters) - Archer Daniels Midland Co (ADM.N) has replaced the leader of its global trading desk, the company confirmed to Reuters on Wednesday, as it sheds traders around the world amid a global grains glut that has squeezed profits.
Gary McGuigan, most recently managing director of global trade at ADM will succeed Gary Towne as president of the global trade desk, ADM said. Reuters first learned of the appointment from an internal company memo that was leaked in Argentina.
The move is in keeping with a time frame set when Towne, who is retiring after 20 years with the company, took the job last year, ADM said.
“Gary Towne’s retirement was planned, and Gary McGuigan’s appointment reflects our ongoing succession planning,” company spokesman Colin McBean said.
Towne spent 20 years with ADM and from 2007 to 2009 chaired the management board of Alfred C. Toepfer, a global grains trading company in which ADM held a majority stake.
ADM opened its global trading desk in Switzerland in 2015 to oversee the company’s supply network.
Towne’s year heading the operation featured a turbulent time for commodity merchants as grain prices stagnated under burdensome stocks and energy and freight prices swung wildly.
In a global shakeup in trading operations, the U.S. agribusiness group has let go key personnel in recent months and exited energy trading. It said in early April that it planned to close its South African trading desk and it shrank its operations in Argentina at a time of increasing food production.
Global heads of grains and oilseed trade will report to McGuigan, the memo said. The new vice president of global trade is Andy Kenny, who will continue to serve as global trade finance director, it said.
In February, ADM reported a 41 percent drop in fourth-quarter net earnings to $424 million. Gains in its agricultural services segment were blunted by more losses by its global trading desk in the quarter, the unit’s second quarterly loss of 2016.
Record global stocks of key commodities including corn, soybeans and wheat thinned margins and limited trading opportunities for ADM.
The company is scheduled to report first-quarter results next Tuesday.
As part of the shake-up of its international trading operations, ADM cut jobs in Argentina last month when it shuttered its Toepfer grains trading unit.
The revamps hit at a time of increased competition from Chinese trading house COFCO Group, which has begun an aggressive expansion into international grains trading.
Additional reporting by Karl Plume in Chicago; Editing by Bernard Orr and Andrew Hay