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Louis Dreyfus continues to plan for North America oilseeds despite tariff storm

Louis Dreyfus continues to plan for North America oilseeds despite tariff storm

The CEO of the global crop merchant said that despite tariff tensions, he expects Canadian vegetable oils to continue to flow to the United States.

The use of tariffs by U.S. president Donald Trump as a key economic and diplomatic instrument has strained ties with trading partner countries including Canada and Mexico.

Washington's tariff offense has upset the U.S. agriculture sector, which depends heavily on North American commerce, including large quantities of canola oils and fertilisers from Canada.

After rapid investment in renewable vegetable oil-based diesel, uncertainty over U.S. policy has clouded the future for agribusiness companies.

LDC CEO Michael Gelchie said that the company is closely monitoring tariff discussions, but has not yet changed its plans for oilseed expansion in North America.

He said that the U.S. import restrictions on vegetable oil would also help to temper any tariff impacts.

In an interview after LDC's results, he stated: "From our perspective, the U.S. markets tend to be deficient in (vegetable oil)." "So, I expect that the flow will continue from Canada."

He added that LDC's global geographic reach would help it to withstand any trade disruptions caused by tariffs.

Bunge, a global agricultural commodities firm, warned that, due in part to trade tensions, its earnings for 2025 could fall to the lowest level since six years.

LDC reported lower earnings last year, as it, like its peers faced lower prices for staple grains.

The group cited a 17% increase in volume handled as a result of investments made in the supply chain and in processing.

Gelchie stated that the high use rates of its new oilseeds processing facility in Nansha (southern China) supported Gelchie's optimism regarding Chinese demand.

Gelchie, when asked about the job cuts made by other agribusiness companies to cut costs, said that LDC did not have such plans. It was more likely for LDC to increase its headcount due to the integration of a number of new activities.

(source: Reuters)