Multinational crop shipper and processor Archer Daniels Midland (ADM) has reported growth across all its divisions over the first quarter of 2022, as it warns of tight crop supplies for the next few years.
The US-based company made a pre-tax profit of $1.27 billion from revenues of $23.65bn in the first three months of 2022, compared to $0.82bn and $18.89bn in the same period of 2021.
The Ag Services & Oilseeds division made an adjusted operation profit of $1.01bn ($0.78bn) “effectively managing risk and executing exceptionally well in a dynamic environment of robust global demand and tight supply, driven primarily by the short South American crop”.
Ag Services saw higher global trade results, despites a fall in North American origination margins and volumes largely due to timing effects which will reverse over the full year. Crushing activities benefited from strong global demand for protein and vegetable oils, with ADM Refined Products enjoying strong margins from refined oils and biodiesel.
Carbohydrate Solutions saw an operating profit of $317m million for the quarter ($259m) with higher revenues from wet corn and wheat milling.
Nutrition division profitability was $189m ($154m). Animal Nutrition profit nearly doubled, primarily due to strong amino acid production, responding to product mix changes, improved North American demand and global supply chain disruptions. The Human Nutrition segment saw strong sales growth in alternative proteins, including the recent Sojaprotein acquisition, with the Health & Wellness business seeing demand for probiotics and fibre products.
“I’m very proud of how our team lived our culture and fulfilled our purpose over the last quarter, as they continued to serve the world’s need for nutrition in a dynamic global environment,” comments ADM chairman and chief executive Juan Luciano. “I’m also very appreciative of how our company has rallied to support our colleagues in Ukraine and the country’s agriculture industry.
“Looking forward, we expect reduced crop supplies — caused by the weak Canadian canola crop, the short South American crops, and now the disruptions in the Black Sea region — to drive continued tightness in global grain markets for the next few years.
“Longer term, markets continue to reflect the importance of the enduring global trends that are fuelling performance across our portfolio by driving demand for our products,” Mr Luciano concludes.