Review of Archer Daniels Midland Company

The agricultural economy is not well known to many people because inour nation most people do not work for companies that are involved inagriculture and most people do not work on farms. The farm industry may bevery large but it could be considered as one of the most importantindustries, because everyone in the world needs something produced on afarm. Most of the companies that are part of the farm or agriculturalindustry are large but not always well known. Most of these companies arespread throughout the whole United States, if not the world. Mostcompanies in the agricultural industry are well put together and they havepeople that work for the company that know a lot about the industry andwithout all of these people the companies would not be what they is today.

ADM is a large company that has been spreading and has had lawsuits becauseof the price hikes that they put on their products. ADM has proven to be acompany that knows what it is doing throughout the years but when they tryto cheat to get more money out of their products they get caught. ADM hasworked their way up the ladder and they find a way to get better at whatthey do. Even though not many people know of ADM their common everydayproducts can have some of the ADM products it is used in many differentparts of the world.

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Archer Daniels Midland Company is a large company that is not known bymany people it is part of the fortune 500 even though it is located inIllinois most people have not even heard of the company. Archer DanielsMidland Company also known as (ADM) is a very successful farming company.

ADM was founded in 1902 by George P. Archer and John W. Daniels. The ADMheadcounters are located in Decater, Illinois even though they are based inIllinois they are incorporated in Delaware. ADM has over 270 processingplants worldwide with sales in over 40 countries and joint ventureinvestments in 71 countries and has over 500 grain elevators. ADM is aglobalized company though most of their business is done in the UnitedStates they employ over 25,000 around the world people which is a largenumber all together. ADM is one of the more dominant companies in itsbusiness, ADM has been improving over the years even though it has hit afew bumps such as some lawsuits. Through these lawsuits the company hasgrown and expanded to be come a worldwide company. Even though ADM is nota widely known company it is still very large and it does control some ofthe normal products that we see in our house.

Value Line says “Archer Daniels Midland is putting together a strongcampaign in fiscal 2004. The company followed up and impressive showing inthe first quarter, with a 106% year over year earnings advance in theDecember period.” that is a positive for the company, they seem to belooking stronger over the past couple years. Value Line also says “thecorn processing segment is poised for another strong showing in calendaryear 2004. The ethanol division, which preformed very well last yearshould benefit from an expected decline (roughly 5%) in corn prices thisyear.” This is all positive for ADM as the company is looking good thisyear. Although the company seems to be doing well the Annual Report fromthe company says “Net earnings for fiscal 2003 decreased due principally toreduced North American and European oilseed crush volumes and margins,reduced operating results of Agricultural Services and wheat processingoperations due to poor crop conditions in North America, and a reduction inthe grain from the settlement of vitamin antitrust litigation.” Eventhough net earnings decreased net sales and operating income increasedthirty-six percent from 2002 to 2003. The cost of products sold went form8.1 billion to 29.0 billion due to recently acquired business.

ADM has many different products that it produces the most importantproducts that it produces is; oilseed, corn, wheat, and AgriculturalServers. ADM is also in a joint venture with Lesaffre, to construct a newyeast plant in Cedar Rapids Iowa.

“Archer Daniels Midland Company (ADM) is a world leader inagricultural processing. ADM is one of the world’s largest processorsof soybeans, corn, wheat and cocoa. ADM is also a leader in theproduction of soy meal and oil, ethanol, corn sweeteners and flour. Inaddition, ADM produces value-added food and feed ingredients.

Headquartered in Decatur, Illinois, ADM has over 26,000 employees,more than 270 processing plants and net sales for the fiscal yearended June 30, 2003 of $30.7 billion.” (Yahoo finance)ADM has proven that it can earn a lot of money even though is not wellknown by common people because ADM works business to business more thanmost companies do so that is mostly the reason that people do not hear ofAMD very often.

ADM like most companies has gone through their share of lawsuits.

Most recently ADM had a class action lawsuit against them. It was becauseof the price of corn syrup most importantly high fructose corn syrup. ADMraised the price of their High Fructose corn syrup, due to this it forcedthe Cola companies to rise the price of their product. ADM was not theonly company named in this lawsuit but they were the biggest company to benamed in the lawsuit. “The Company along with other companies has beennamed as a defendant in the thirty-one antitrust suits involving the saleof high fructose corn syrup in the United States. Thirty of these actionshave been brought as putative class action.” (Form 10-K Securities andExchange Commission) There were also other lawsuits named with ADM andother companies in a lawsuit about Monosodium Glutamate. “The companyalong with other companies has been named as a defendant in sixteenputative class action antitrust suits and one non-class action suitinvolving the sale of monosodium glutamate and/or other food flavoringenhancers in the United States and three putative class action antitrustsuits involving the sale of nucleotides and monosodium glutamate in Canada.

Except for the actions specifically described below, all such suits havebeen settled, dismissed or with drawn.” (Form 10-K Securities and ExchangeCommission)So just like any other company in America ADM has hadlawsuits that have made their company what it is today.

The current ownership for ADM is spread through many different peopleand companies. The two major principal holders of voting securities isState Farm Mutual Automobile Insurance. They have 56,503,012 shares forthe company they have the most amount of shares among companies. Also theother major company is Brandes Investment partners, LLC which has a dollaramount of 36,408,113 shares which is number two among all companies. Forpeople the top common stock holders are. Molline Hale Carter, 41 chairman,Sunflower Bank with 14,421,701 common shares which is 2.23% of all shareholders. Second person on the list is J. K. Vanier who is the chiefexective officer with 12,272,217 common shares which is 1.9%. The thirdperson is G. Allan Andreas Chairman of the board which has 4,966,755 commonshares. Next is D. J. Mimran who owns 2,831,624 common stock.

The ADM mission statement is “To unlock the potential of nature toimprove the quality of life.” To me this says that ADM is looking toadvance in technology and help people improve their quality of life. TheADM commitment is also “To make the world a better place by applyingadvancements in research and technology to agriculture.” This tells me thatADM is looking to be able to produce at a faster rate than they are rightnow. ADM is working for their costumers and they are hoping that they canhelp out their costumers in any way possible. The company is expanding inmany ways and the mission statement also helps prove this because it ishelping the technology that is used for their products. ADM seems to bemoving into the 21st century very well because the way that it seems theykeep looking to expand their company and they want to find new technologythat will help people on all levels of the economy.

In conclusion ADM is expanding all over the world and it is helpingout all of the people that buy their products. ADM is a very large companythat not everyone knows about, but ADM is getting bigger and I think thatmore people will start to know about it. I think that ADM is going tostart buying other agricultural companies. ADM is a good investment forpeople that are looking to buy stock and they are going to go up in thefuture because the people that run ADM seem to know what they are doing.

ADM seems to be willing to do anything to be a more advanced company nomatter what it has to do, either joint venture or buying other companies toexpand. The 2004 fiscal outlook for ADM looks good, they have increasedtheir net sales from 2002 to 2003, now it seems that in the fiscal year2004 they are going to be doing well and they will be working for everyone,not just their company. ADM has been around for over 100 years and thereis no telling what they are going to do in the future, the company has beenexpanding since they started in 1902 and ADM is a large company that couldone day be the biggest company in the United States. ADM is located inover 70 countries and it works for people all over the world. I am surethat we will be hearing great things about ADM in the near future becausethey know what type of business they want to do.

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Review of Archer Daniels Midland Company. (2019, Apr 14). Retrieved from