Archer Daniels Midland (ADM), which describes itself as a company that “connects crops to markets”, has reported net earnings for the quarter of $284 million, or $0.43 per share, down around 25% from $0.58 per share in the same period one year earlier. Operating profit was $544 million.
“In a challenging fourth quarter, solid results from our global oilseeds business, particularly in South America, were more than offset by negative U.S. ethanol margins and weaker U.S. merchandising results,” said ADM Chairman and CEO Patricia Woertz.
“As we look ahead, while drought has reduced the potential size of the U.S. corn crop, we are tracking the development of other crops in North America and Europe,” added Woertz. “While U.S. crop carryouts are expected to be low, we have an experienced business team to manage through this environment.”
“Conditions like these demonstrate the vital role of our global agribusiness. As weather has regional effects on crops, we respond by working with our customers to provide the best alternatives to meet their needs from all growing regions of the world.”
The company noted that corn processing results decreased $48 million as negative ethanol margins more than offset improved results from sweeteners and starches. Sweeteners and starches operating profit increased $124 million to $135 million, amid continued good sweetener export demand and higher average selling prices.
Looking to the future, ADM said that the smaller South American spring harvest means that the U.S. is currently the primary global supplier of soybeans and meal. U.S. corn and soybean yields have been reduced by drought; wheat was less affected. Generally high crop prices will, said the company, encourage large planted acreage in South America. Global protein meal demand remains good, while demand for corn sweeteners remains solid, supported by exports.