Archer Daniels Midland Company was incorporated in Delaware in 1923, successor
to the Daniels Linseed Co. founded in 1902. The Company is principally engaged
in procuring, transporting, storing, processing and merchandising agricultural
commodities and products.
The Company's operations are classified into four reportable business segments:
Oilseeds Processing, Corn Processing, Wheat Processing and Agricultural Services.
Each of these segments is organized based upon the nature of products and services
offered. The Company's remaining operations are aggregated and classified as
Other.
Oilseeds Processing
The Company is engaged in processing oilseeds such as soybeans, cottonseed,
sunflower seeds, canola, peanuts, flaxseed and corn germ into vegetable oils
and meals principally for the food and feed industries. Crude vegetable oil
is sold "as is" or is further processed by refining, bleaching and
deodorizing into salad oils.
Corn Processing
The Company is engaged in wet milling and dry milling corn operations. Products
produced for use in the food and beverage industry include syrup, starch, glucose,
dextrose, and sweeteners. Corn gluten feed and meal as well as distillers grains
are produced for use as feed ingredients.
Wheat Processing
The Company is engaged in milling wheat, corn and milo into flour. Wheat flour
is sold primarily to commercial bakeries, food companies, food service companies
and retailers. Bulgur, a gelatinized wheat food, is sold to both the export
and the domestic food markets.
Agricultural Services
The Agricultural Services segment utilizes the Company's extensive grain elevator
and transportation network to buy, store, clean and transport agricultural commodities,
such as oilseeds, corn, wheat, milo, oats and barley, and resells these commodities
primarily as feed ingredients and as raw materials for the agricultural processing
industry. Agricultural Services' grain sourcing and transportation network provides
reliable and efficient services to the Company's agricultural processing operations.
Methods of Distribution
Since the Company's customers are principally other manufacturers and processors,
its products are distributed mainly in bulk from processing plants or storage
facilities directly to the customers' facilities. The Company has developed
a comprehensive transportation system utilizing trucks, rail, river barges and
ocean-going vessels to efficiently move both commodities and processed products
virtually anywhere in the world. The Company owns or leases large numbers of
the trucks, trailers, railroad tank and hopper cars, river barges and towboats
used in this transportation system.
Source and availability of raw materials
Substantially all of the Company's raw materials are agricultural commodities.
In any single year, the availability and price of these commodities are subject
to unpredictable factors such as weather, plantings, government (domestic and
foreign) farm programs and policies, changes in global demand created by population
growth and changes in standards of living and global production of similar and
competitive crops.
Competitive conditions
Markets for the Company's products are highly price competitive and sensitive
to product substitution. No single company competes with the Company in all
of its markets. However, a number of large companies compete with the Company
in one or more markets. Major competitors in one or more markets include, but
are not limited to, Barry Callebaut A.G., Bunge, Ltd., Cargill, Inc., ConAgra,
Inc., Corn Products International, Inc. and Tate & Lyle PLC.
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