ED&F Man Holdings Ltd, one of the world’s largest sugar merchants, will close its office in Uruguay and has lost at least three senior traders in the Americas in recent months due to cost-cutting amid a years-long bear market, sources said.
The London-based commodities merchant is shutting its longtime office in Uruguay’s capital, Montevideo, where it employed at least 10 people, including country manager Juan-Carlos Jimenez, three sources said.
It has lost three key employees in Mexico and Miami, according to three industry sources.
Jorge Spencer, who managed some South American trade from the company’s Miami office, left after a decade with the company. In Mexico, the head of the NAFTA region, Carlos Porragas, and top trader Mario Tobon both quit this summer.
Tobon has since joined Swiss-based chocolate maker Barry Callebaut AG, while Porragas, whose LinkedIn profile says he joined ED&F just over four years ago, has left the industry, two sources said.
A spokesman for the company, which is over 200 years old, declined to comment. Suedzucker, Europe’s largest sugar refiner, owns a 24.99 percent stake in Ed&F Man.
Efforts to reach all of the traders were unsuccessful.
While a small number relative to ED&F’s global staff of 4,000, the departure of senior traders and withdrawal from Uruguay have drawn notice within the sugar industry as merchants and producers struggle with prices at seven-year lows and a five-year surplus.
“The story has been about cutting costs,” said a trader familiar with the changes.
Another industry source said the reshuffle comes as ED&F Man focuses on more profitable business areas – it aims to boost trade to regions like Africa, recently acquired the remaining stake of Chilean sugar company Iansa S.A. it didn’t own and has been building its coffee and brokerage businesses.
It also comes months after ED&F took the reins at Mexico’s Grupo Saenz, in which it holds a minority stake. [ID: nL1N0UK2AQ]
The changes all follow the early 2014 installation of a new chief operating officer, Raees Lakhani, in London with a background in cost-cutting.
The tough market conditions have been particularly hard on merchants as competition for business has increased.
ED&F’s rivals, such as Bunge Ltd and Archer Daniels Midland Co, have been looking to sell their sugar mills in top producer Brazil for years.
In June, rivals Ecom Agroindustrial Corp and V&A Commodity Traders Inc joined forces, following a similar move by commodities powerhouse Cargill and Brazilian cooperative Copersucar last year