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LDC says grain and oilseed margins curbed in first half

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Cotton, sugar results also lower, coffee improves

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Crop merchants face ample supply, uncertain demand

(Adds market context, details on results in paragraphs 5-12)

By Gus Trompiz

PARIS, Sept 20 (Reuters) - Louis Dreyfus Company (LDC)

posted higher first-half sales volumes and a drop in profit on

Friday as the commodity group faced rising supply and lower

prices of some major crops.

LDC, one of the world's largest crop traders and processors

whose competitors include ADM, Bunge and Cargill,

said its core earnings (EBITDA) were $1.057 billion in the first

six months of 2024, against $1.169 billion a year earlier.

Net sales fell to $25.6 billion from $25.8 billion but

shipped volumes rose 19.4%, LDC said in a statement.

"Our diverse and global business activities allowed us to

deliver strong results ... as an overall recovery in crop sizes

and ample stocks globally put pressure on prices and resulted in

less volatile market dynamics," said CEO Michael Gelchie.

Global prices of corn, wheat and soybeans have slipped to

their lowest since 2020 amid rising supplies and signs of

slowing demand from China, a turnaround from surging prices two

years ago after Russia's invasion of Ukraine.

ADM and Bunge both posted lower than expected second-quarter

profits in July, reflecting leaner margins for oilseed crushing.

LDC also cited weaker processing margins in North America

and slow farmer selling in Brazil.

Operating profits fell at LDC's grain and oilseeds business

and also at its cotton business, in the face of slow global

demand, and at its sugar unit as volumes fell, it said.

LDC said profits improved for its coffee business due to

higher volumes and better origination margins, particularly in

Brazil, adding it had successfully hedged risk during volatility

linked to crop setbacks and Red Sea shipping disruption.

It did not give an outlook for its full-year.

LDC has partly shifted its focus towards the consumer end of

the food chain to become less reliant on commodity trading. It

has launched its own juice brand and established a pulses unit

to support expansion into plant-based protein products.

The group, privately controlled by Margarita Louis-Dreyfus

via family trust Akira, said it paid a $507 million dividend to

shareholders during the first half.