ADM’s Earnings up 20%
02 February 2007
Archer Daniels Midland’s net earnings for the quarter ended 31 December 2006 increased 20% to $441 million.
Corn Processing operating profits jumped 42% to $335 million for the quarter. Increased starch, sweetener and ethanol selling prices contributed to the earnings improvement and were partially offset by increasing net corn costs.
Oilseeds Processing operating profits increased 50% to $192 million for the quarter.
Does anyone see a problem here?
Grocery stores across the world are now stocked full of High Fructose Corn Syrup and Partially Hydrogenated Soybean Oil rather than healthy, all-natural foods. ADM sets new profit records and lobbies congress for subsidies in the name of ethanol production. What is not adding up?
Governments worldwide must immediately stop allowing industrial giants -- whose motivation is profit, not health or safety -- to dictate both food standards and now fuel standards too. Not only does ADM put the small farmer out of business, now it's edging got a foothold on the fuel market too. I don't buy it, and neither should anyone else concerned with the long term health of people, environment, and economy.
Posted by: J Rouleau | 02 February 2007 at 02:28 PM
Nobody that has been around this site for very long is at all surprised.
Posted by: Neil | 02 February 2007 at 04:56 PM
I'm certain that even small farmers would like to make a profit, too.
Posted by: Cervus | 03 February 2007 at 10:02 AM
High fructose corn syrup (HFCS) is still rather prevalent in manufactured food items, but trans-fats have rapidly been going out of style. Causes may include increased publicity due to the NYC ban on trans-fats in restaurant foods and a new labeling requirement under which manufacturers must break out the percentage of trans-fats much like they have been breaking out the percentages of saturated fats. A further labeling rule requiring food producers to break out carbohydrates by type might lead to a similar reaction against HFCS -- I could imagine total carbohydrates being subdivided into "fiber" (already broken out) as well as "complex carbohydrates" and "simple carbohydrates," and the latter perhaps broken out into "fructose," "sucrose," "glucose" and "other."
On a related note, many "small farmers" do profit from ADM's success. ADM does not directly own and manage all that many farms -- most "factory farming," especially of plant crops, is conducted by farmers with relatively smaller holdings (500 - 1500 ac., to my recollection) who practice conventional agriculture (think Monsanto seeds and typical pesticide usage), and sell to processing conglomerates such as ADM.
Profts at ADM only indirectly translate to increased farm incomes, because higher prices to the farmer, at this stage, probably serve only to reduce the amount of government subsidy they receive. This point is largely surmise on my part, as I have not yet compared recent government outlays on farm programs to total output, market price and farm income. But the structure of many farm support programs would suggest that they were designed to phase out as market prices came up.
Posted by: NBK-Boston | 04 February 2007 at 10:54 AM