Louis Dreyfus Pursues Oilseed Expansion Despite Tariff Challenges
By Gus Trompiz
PARIS (Reuters) - Louis Dreyfus Company is pushing ahead with plans to expand its oilseed processing in North America and expects Canadian vegetable oil to continue flowing to the United States despite tensions over tariffs, the global crop merchant's CEO said on Wednesday.
U.S. President Donald Trump's use of tariffs as a core economic and diplomatic tool has upended ties with trading partners including neighbours Canada and Mexico.
Washington's tariff offensive has unsettled the U.S. agricultural sector, which relies heavily on North American trade, including large volumes of canola oil and fertiliser from Canada.
Uncertainty over U.S. biofuel policy, after rapid investment in renewable diesel using vegetable oil, has also clouded the outlook for agribusiness firms.
LDC is monitoring tariff discussions but so far has made "no change in timing, scale, or expectation" to its oilseed expansion plans in North America, CEO Michael Gelchie told Reuters.
U.S. import requirements in vegetable oil should also temper any tariff effects, he said.
"From our standpoint, the U.S. market tends to be in deficit in (vegetable) oil," he said in an interview following LDC's annual results. "So I suspect that flow will continue to find its way from Canada."
More widely, LDC expects its worldwide geographical reach to help it withstand any trade disruptions linked to tariffs, he added.
Bunge, another global agricultural commodity firm, warned last month that its 2025 earnings could sink to their lowest level in six years, partly due to trade tensions.
LDC reported lower earnings for last year as, like its peers, it faced more subdued prices in staple grains.
But the group talked up a 17% rise in volumes handled, supported by investments in its supply chain and processing.
High use rates at its new oilseed processing facility in Nansha, southern China, supported the group's optimism about Chinese demand, Gelchie said.
Asked about job cuts by other agribusiness groups to reduce costs, Gelchie said LDC had no such plans and was more likely to increase headcount as it integrated a string of new activities.
(Reporting by Gus Trompiz; Editing by Joe Bavier)
