In the last quarter, Archer Daniels Midland (ADM) has booked 72 percent more profit than the same quarter last year.
The US agricultural company saw an improvement in the margins in the processing of corn and trade in agricultural commodities. The financial results regarding the processing of oilseeds remained flat.
The turnover of ADM did fall from $21.39 billion to $18.18 billion (€14.6 billion). This is mainly because farmers save a large part of the harvested corn and soy because of the bad prices. Companies like ADM, Cargill and Bunge therefore have less volume available for trading.
ADM expects that the available volume of raw materials will increase in the next quarter. This idea seems to be partly based on the expectation that a record harvest will be made and that the storage capacity of farmers will therefore be inadequate. According to Bunge, a rebound can only be expected in the first or second quarter of 2015. Not only in the US but also in Brazil and Argentina farmers are ‘hoarding’ there raw material stock.
The net profit of ADM increased to the equivalent of €598 million. The largest contribution to earnings came from the corn and oilseed processing divisions. Operating profit from the corn processing division almost doubled to the equivalent of €285 million. Margins on bioethanol were solid.