Food for thought in a resilient market

By Zhong Nan | China Daily | Updated: 2017-06-02 07:20

David W. MacLennan, chairman, president and CEO of Cargill, has always had a passion for China and its people. [Photo provided to China Daily]

Cargill CEO MacLennan talks about the agricultural conglomerate's business prospects and the drive for quality produce in China

David W. MacLennan believes one of the greatest qualities you can have as a senior executive is "resilience".

The chairman and chief executive officer of agricultural conglomerate Cargill Inc has a simple philosophy of hard work and a balanced approach to life.

MacLennan has helped mastermind the expansion in China of one of the world's biggest privately-owned companies.

"I've learnt that the quality you need most is resilience and a balanced approach to life," he said.

Based in the United States city of Minnesota, Cargill employs 150,000 workers in 70 countries and regions and draws together the strands of food, agriculture, nutrition and risk management.

For more than 150 years, it has "helped farmers grow more, connecting them to broader markets".

Last year, Cargill's agricultural business reported sales revenue of $107.2 billion.

But this low-profile giant still fell under the radar, even though it would rank in the top 20 Fortune 500 if it were a publically-listed company in the US.

A major investor in China's food sector, Cargill is expanding rapidly here.

"There are many reasons we are growing our presence in China," said MacLennan, 57. "As people's incomes improve, they want to eat better.

"And so they want to take their diet from grain, fruit and rice into animal protein."

The second generation from his family to work for the company, MacLennan explained about his China experience, the firm's plans for the future and his hands-on approach in a wide-ranging interview to China Daily.

A researcher at Cargill's R&D facility in Tianjin conducts a hazard analysis test. [Photo provided to China Daily]

How do you see the future for globalized trade?

People are watching this carefully. I'm hopeful because all the indications are that the first meeting with US President Donald Trump and President Xi Jinping was very productive. They did talk about trade.

But then, trade globalization can certainly bring growth opportunities for market players like us, and will benefit the participating countries and consumers in the long run.

Will demand for quality food in China continue to grow?

We believe that as Chinese consumers continue to become more wealthy, they will be having more demand for meat. That is why we built our chicken facility in Anhui province four years ago.

We also launched Cargill ONE in Shanghai, the innovation center for the Chinese market last year. Together with our partners and customers, we will bring more high quality food－including meat－to the market place.

China's central government has opened up more sectors to foreign direct investment. What other areas need to be looked at?

One area we are eager to see liberalized is foreign investment in soybean crushing. We have seen some positive moves in this sector and are glad of it.

We think we are going in the right direction as this will ultimately benefit consumers.

Of course, the government has gone a long way to liberalize the corn market in terms of reducing subsidies and price support.

And we have a sweet starches and sweeteners business here that is significant. I also hope that the market will be more open to US beef. That is something we would like to be involved in.

Do you have plans to develop lower-tier Chinese cities?

A lot of our business is actually in those cities. Some are more on the coastal side but our feed operation and poultry business are more in rural areas.

If you look at the map of our footprint, our 50-plus locations in China are widely spread. They are not only in top-tier cities.

What are your plans to develop the market here during the next five years?

We have doubled our investment in China in the past seven years. Our expectation is to double it again in the next seven years.

Investment will be in areas such as the food supply chain, the animal protein chicken business, food ingredients, edible oils and animal nutrition. We have just opened up an oilseeds crushing plant in Huanghua, Hebei province, in April. The facility is able to crush up to 5,000 metric tons of soybean a day.

How do you help to ensure food safety in China?

We work very closely with government and various organizations. We have provided hours of food safety training to stakeholders in China.

Since we are a food company, we have to be committed to making safe food. We want to share what we have learnt over 150 years in terms of food safety.

Your father worked in Cargill for 42 years. So it's like a family business?

My family is not as big as the Cargill family. My dad worked here for 42 years before leaving the company 20 years ago.

I'm the ninth CEO in Cargill history. There will probably be nine more after me.

I personally don't think CEOs should be in their jobs for much longer than 10 years. You know you need fresh eyes. I will retire when I reach 65.

What are your biggest achievements in China as Cargill's CEO?

I'm proud of our growth here in the last seven years and we will continue to expand. I mentioned our new oilseeds crushing plant in Huanghua port in Hebei province.

We have also done an amazing job with our chicken business in Anhui province, the e-commerce platform and other value-added products in China. We want to continue to invest here and there is so much growth potential for us.

What's your life and business philosophies?

I believe in a balanced approach to life as my university education was in liberal arts. Actually, I specialized in literature at university and took courses in foreign languages, politics and history.

I think it's good to experience a lot of different things. And you need to have fun along the way.

I don't take myself too seriously but you know I recognize I have a privileged position as CEO of Cargill.

How do you motivate your international team?

Part of it is through travel, so I can get my feelings directly across to people we work with. I've been to four countries in 10 days. We have a total of 42,000 employees in China, Thailand and Indonesia.

I may not reach everybody but I'm talking to people and interacting with them. So, it is being accessible, being visible.

How do you handle setbacks, if any?

I'm three-and-a-half years into the job now, and what I've learnt is that the quality you need most is resilience. You've got to be able to come back from setbacks.

I read somewhere that in any given day every piece of good news you receive, you get four or five pieces of bad news. And you've got to be able to put this into context and say it is part of the job.

You must not feel sorry for yourself. Instead, you need to say: "All right we can figure this out". And I think it's a skill that comes with practice.

But I think you have to have interests outside of your work. You need to exercise. You need family and friends to keep the right balance. Again, it comes back to my liberal arts education.

Also, I don't define myself by my job. I'm a husband, a father, a friend and a CEO. I think some CEOs get so wrapped up in their identities they forget who they are.

Which parts of China do you like the most?

You know there are so many places I could mention. My first trip to China was to Guangzhou in 2003. Since then, I have been here 13 times.

The one that is most memorable is Xi'an. When you look at those Terracotta Warriors, you think that after centuries, they are still there and so vivid.

You just can't believe it. I must have taken more than 200 pictures. I wanted to go down and touch them but I couldn't.

Age: 57

Nationality: US

Career:

2015 onwards: Chairman, President & CEO, Cargill Inc

2013-15: President & CEO, Cargill

2011-13: President & Chief Operating Officer, Cargill

2008-11: CFO, Board of Directors, Cargill

2002-08: Various leadership responsibilities

1991-2000: Various responsibilities, including director and CFO of Cargill Financial Services Corporation, Cargill

1982-91: Various positions at Goldberg Bros. Member of the Chicago Board of Trade and the Chicago Options Exchange

Education: