MERRIAM, KANSAS, US — Seaboard Corp. posted operating income of $30 million in its Commodity Trading and Milling (CT&M) segment during the first quarter ended March 28, up sharply from $7 million in the same quarter a year ago.

Seaboard said the increase in operating income primarily reflected higher margins on third-party sales, including its October 2019 transaction giving it control of Continental Grain’s shares in ContiLatin del Peru SA (CLDP).

“Due to worldwide commodity price fluctuations, the uncertain political and economic conditions in the countries in which this segment operates, including impacts of the COVID-19 pandemic, and the volatility in the commodity markets, management is unable to predict if this segment will be profitable for the remainder of 2020,” Seaboard noted in an April 27 filing with the US Securities and Exchange Commission.

Net sales for the segment during the most recent quarter totaled $914 million, up 10% from $829 million in the same period a year ago. The increase primarily reflected higher volumes of certain commodities for third-party customers, including sales for CLDP, and higher corn and soybean prices, partially offset by lower affiliate volumes and lower wheat and other commodity prices, Seaboard said.

“Had Seaboard not applied mark-to-market accounting to its derivative instruments, operating income for this segment would have been lower by $5 million and higher by $3 million for the three-month period of 2020 and 2019, respectively,” Seaboard said.

In the filing, Seaboard said it invested $55 million in property, plant and equipment during the first quarter of fiscal 2020, most of which went toward the company’s Pork segment. For the remainder of fiscal 2020, Seaboard has budgeted capital expenditures totaling $241 million, of which $22 million has been earmarked for the CT&M segment, primarily for milling assets and other improvements to existing facilities and related equipment.

Overall, Seaboard in the first quarter sustained a loss of $103 million, which compared with income of $57 million, equal to $48.79 per share on the common stock, in the same period a year ago. Net sales were $1.68 billion in the first quarter, up 9% from $1.54 billion in the same period a year ago.