Fitch: Sustained Low Commodity Pricing Supporting U.S. Agribusiness Profitability

CHICAGO--()--Pricing trends for key agricultural commodities will drive solid operational performance across agribusiness companies, especially as large U.S. harvests come to market in the second half of the year, according to a Fitch Ratings' Agribusiness Dashboard Report published today.

Fitch sees the current low pricing environment in key agricultural commodities - corn, soybeans and wheat -sustained into the coming year given abundant supplies and promising current crops. In this environment, Fitch expects the large agribusiness companies to benefit from increased capacity utilization from commercialization of promising harvests of major agricultural commodities.

Agribusiness is opportunistically utilizing presently strong cash flows resulting from lower working capital requirements to enhance geographic positioning and solidify portfolios with value-added products and services. Each agricultural commodity firm rated by Fitch has actively pursued acquisitions that have addressed growing consumer demand for healthy food products. Fitch sees continued asset purchases of the size easily managed through cash flows or short-term funding.

The dashboard includes a synopsis of key industry indicators and trends for commodity pricing, industry profitability and leverage measures. The full 'Agribusiness Dashboard' is available at 'www.fitchratings.com' or by clicking on the link.

Additional information is available at 'www.fitchratings.com'.

Agribusiness Dashboard (October 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=872051

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contacts

Fitch Ratings
Michael Zbinovec
Senior Director
+1-312-368-3168
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
Samantha Silverstein
Analyst
+1-312-368-3145
or
Media Relations:
Alyssa Castelli, +1 212-908-0540
alyssa.castelli@fitchratings.com

Contacts

Fitch Ratings
Michael Zbinovec
Senior Director
+1-312-368-3168
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
Samantha Silverstein
Analyst
+1-312-368-3145
or
Media Relations:
Alyssa Castelli, +1 212-908-0540
alyssa.castelli@fitchratings.com