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German Agricultural trader Baywa AG’s H1 earnings in its agricultural segment jumped over 43% on the year, benefitting from higher prices on grain markets, the company said in its half-year financial statement Thursday.
The first half-year’s EBIT for the segment came in at €88.3 million, compared with €61.6 million recorded at the same period last year, with revenues up by 8.6% on year to reach €6.03 billion.
The segment’s revenues represent about two-thirds of the company’s total, with the group also in energy and building materials.
“From energy to agriculture to building materials, we recorded huge double- and even triple-digit percentage growth across all operating segments,” said Baywa chief executive Klaus Josef Lutz.
“Cefetra Group and Agri Trade & Service in Germany were the two drivers of growth, as both business units benefited from high prices and fluctuations in the price of commodities,” said Baywa in its press release on the half-year report.
Despite the slight decline in sales volumes, Bajwa’s agricultural trade segment Cefetra Group reported that its EBIT hit €20 million, compared with only €8.6 million recorded last year as it benefitted from the rally in global grains and oilseed prices in the first half of 2021.
“Higher prices were caused in particular by ongoing strong demand from China and poor weather conditions in the US and Europe,” Baywa said in its earnings statement, adding that rising demand for biofuel also boosted prices.
The Agri Trade & Service business also contribute an over double growth with EBIT at €39 million in the first half this year.
“(Domestic) grain inventories from last year’s harvest were able to be marketed at improved trade margins. Restructuring in domestic agricultural business also had a positive impact on earnings,” Baywa said.
However, both global produce and agricultural equipment segments reported negative growths at €14.5 million and €14.7 million, respectively.
The overall group, including its Energy and Building Materials segments, posted first-half revenues of €9.3 billion, up 13.3% on the year with EBIT up over 169%% to €144.6 million.