- The Washington Times - Wednesday, April 30, 2008


Archer Daniels Midland, the world’s largest grain processor, said yesterday third-quarter profit rose 42 percent as it increased commodity trading and soybean crushing.

Net income climbed to $517 million, or 80 cents a share, in the three months through last month, from $363 million, or 56 cents, a year earlier, Decatur, Ill.-based ADM said. Sales rose 64 percent to $18.7 billion.

Profit in the agricultural services unit, which stores grain and transports it to market, surged almost eightfold to $366 million as rising demand pushed wheat, soybean and corn prices to records. Volatile crop markets are creating “unprecedented” profit opportunities, Chief Executive Officer Patricia Woertz said in a statement.

ADM shares fell $1.84, or 3.9 percent, to $45.58 after the company announced delays in completing some ethanol projects. The shares climbed 22 percent in the year through Monday and reached a record $48.95 on April 22.

The company, the operator of more than 350 grain elevators globally as well as the third-largest U.S. ethanol producer, benefited from last year’s record U.S. corn crop.

Yet earnings from processing corn into sweeteners and ethanol, the biggest profit contributor last year, fell 31 percent to $172 million because of higher costs for corn and energy, ADM said.

Corn prices averaged 28 percent higher during the quarter. ADM has 1.07 billion gallons of annual ethanol capacity.

The company expects improved ethanol prices in the current quarter as demand continues to grow, Chief Financial Officer Steven Mills said during a conference call.

“We look cautiously further out as it is still unclear how quickly the industry will absorb the additional capacity scheduled to come into production,” Mr. Mills said.

Ms. Woertz said ADM won’t retreat from its ethanol business amid recent calls by some lawmakers and livestock company executives for the U.S. to reduce support for biofuel production.

Quitting ethanol-making would be “wrong,” “dangerous” and a “mistake,” Ms. Woertz said during the call.

“I actually find it sad and maybe even a little ironic that these misguided attacks on biofuels are directed at the one alternative we actually have today to transportation fuel,” Ms. Woertz said.

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