Archer Daniels Midland

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Former corporate logo

The Archer-Daniels-Midland Company, commonly known as ADM, is an American multinational food processing and commodities trading corporation founded in 1902 and headquartered in Chicago, Illinois. The company operates more than 270 plants and 420 crop procurement facilities worldwide, where cereal grains and oilseeds are processed into products used in food, beverage, nutraceutical, industrial, and animal feed markets worldwide.

ADM ranked No. 35 in the 2023 Fortune 500 list of the largest United States corporations.<ref name="F500_2022">Template:Cite web</ref>

The company also provides agricultural storage and transportation services. The American River Transportation Company along with ADM Trucking, Inc., are subsidiaries of ADM.

ADM has been the subject of significant media attention and infamy over the years with its various scandals, one inspiring a novel and subsequent film The Informant!.

History

Early history

In 1902, John W. Daniels started a linseed crushing business in Minneapolis, Minnesota.<ref name=JayPedersonQuote1902>Template:Cite book</ref><ref name=Schneider16>Template:Cite news</ref><ref name=Black13>Template:Cite news</ref> George A. Archer joined the operation the next year, and in 1905 the firm's name officially became the Archer-Daniels Linseed Company.<ref name=JayPedersonQuote1902/><ref name=Cayton2003>Template:Cite news</ref> In 1923, Archer-Daniels Linseed Company acquired Midland Linseed Products Company and then incorporated as the Archer Daniels Midland Company.<ref name=JayPedersonQuoteOne>Template:Cite book</ref><ref name=Valente>Template:Cite web</ref> The new corporation had total assets exceeding $11 million and controlled just over a third (35%) of the total linseed mill capacity within the United States.<ref name=WDH>Template:Cite news</ref><ref name=JayPedersonQuoteOne/>

In 1924, ADM was listed on the New York Stock Exchange.<ref name=Mall2021>Template:Cite news</ref><ref name=Lusvardi09>Template:Cite news</ref><ref name=Mattioli>Template:Cite news</ref> A series of acquisitions over the next several years expanded the company's oil processing capabilities and agricultural operations, and a grain division was established in 1927.<ref name=JayPedersonQuoteTwo>Template:Cite book</ref><ref name=KotrbaQuoteOne>Template:Cite news</ref> In 1930, ADM purchased control of the flour milling company Commander-Larabee Corp., which was capable of producing 32,000 barrels of flour per day.<ref>Template:Cite magazine</ref><ref name=Sosland10>Template:Cite news</ref><ref name=Mitchell>Template:Cite book</ref> In 1934 the company began operating its first continuous solvent extraction plant in Chicago, Illinois and could now produce soybean oil.<ref name=KotrbaQuoteOne/><ref name=OMG1947>Template:Cite news</ref> The rapid development of similar extraction plants soon followed.<ref name=OMG1947/>

By 1952, Archer Daniel Midland's workforce had expanded to 5,000 employees,<ref name=KotrbaQuoteTwo>Template:Cite news</ref> and by 1952 the company was operating overseas and manufacturing over 700 products.<ref name=JayPedersonQuoteThree>Template:Cite book</ref>

In 1962, the company acquired a trademark for "ADM" and began referring to itself by those initials.<ref name=AoyagiPage6Quote2>Template:Cite book</ref> In 1965, ADM registered the original patent for textured vegetable protein and began producing the soy flour product at its Decatur East Plant by 1966.<ref name=Reid22>Template:Cite news</ref><ref name=Veg21>Template:Cite news</ref>

In 1966, Dwayne Andreas and his brother Lowell Andreas became minority shareholders in ADM.<ref name=Meersman16>Template:Cite news</ref> In 1969, ADM relocated its headquarters from Minneapolis to Decatur, Illinois, a location closer to the company's soybean processing operations.<ref>Template:Cite news</ref><ref>Template:Cite news</ref> At this time, it was already considered one of the world's largest agribusiness company, with a labor force of more than 24,000 employees.<ref>Template:Cite book</ref>

Dwayne Andreas period (1970–1997)

Dwayne Andreas was named CEO of ADM in 1970,<ref name=Schneider16/> and two years later was elected chairman of the company's board.<ref name=AoyagiPage8Quote1>Template:Cite book</ref> Under his leadership, Archer Daniels Midland acquired many smaller agricultural companies and expanded into international markets,<ref name=Mercer>Template:Cite news</ref> eventually becoming one of the world's largest agricultural processing companies.<ref name=Schneider16/><ref name=Miller16>Template:Cite news</ref> During this period, the company's soybean exports increased from $1.5 billion to $7 billion.<ref name=Schneider16/><ref name=StarTrib>Template:Cite news</ref>

Chief executive officers

Started	Name
1970	Dwayne Andreas
1997	G. Allen Andreas
2006	Patricia A. Woertz
2015	Juan Luciano

In 1974, ADM made its first expansion into Europe and South America when the company acquired soybean plants in Holland and Brazil.<ref name=AoyagiPage8Quote3>Template:Cite book</ref><ref name=Valente/>

In 1982, ADM established international grain operations when it purchased a portion of Toepfer International, a Germany-based grain trading firm.<ref name=AoyagiPage9Quote3>Template:Cite book</ref>

In 1989, ADM purchased Collingwood Grain Inc. based in Hutchinson Kansas, adding 48 million bushels of grain storage at 36 terminal elevators.<ref name="Collingwood to Sell Units">Template:Cite web</ref> Dwayne Andreas stepped down from his position as CEO in 1997 and was succeeded by his nephew G. Allen Andreas.<ref name=Eichenwald97>Template:Cite news</ref> The transition occurred a year after the company pleaded guilty to price-fixing.<ref name=Miller16/><ref name=Mercer/>

2001–present

In 2001, Paul B. Mulhollem became the company's president.<ref name="Archer-Daniels-Midland-Sep-2002-10-K">Template:Cite web</ref> In December 2001, ADM completed the first U.S. commercial sale to Cuba since the embargo was imposed in October 1960.<ref name=PBS2002>Template:Cite news</ref> The next year ADM sponsored a major agribusiness show in Havana, where the company signed a $10 million contract with Cuba’s food import agency, Alimport, to deliver rice, cooking oil, and soy.<ref name=PBS2002/>

In March 2006, G. Allen Andreas announced he was stepping down as CEO.<ref name=Lambert06>Template:Cite news</ref> Later, in May 2006, Patricia A. Woertz became the company's chief executive officer.<ref name=Cancino14>Template:Cite news</ref> In February 2007, Woertz was elected chairman of the board at ADM.<ref name="Archer-Daniels-Midland-Feb-2007-8-K">Template:Cite web</ref> In 2012, the company sought to acquire strategic holdings to support serving Asian markets through the acquisition of GrainCorp, an Australian grain firm with a network of storage and port facilities in Australia.<ref name=Feast13>Template:Cite news</ref> On November 28, 2013, the acquisition was blocked by the Australian Treasurer Joe Hockey after Australia's Foreign Investment Review Board failed to reach a consensus recommendation.<ref name=Feast13/>

The company moved its headquarters to Chicago in 2014.<ref>Template:Cite web</ref>

That same year, ADM completed its acquisition of Toepfer International, Germany's largest grain trader, and renamed the company ADM Germany GmbH.<ref name=Polansek2014>Template:Cite news</ref> The company also announced that it would buy Swiss-German natural ingredient company Wild Flavors for $3 billion, a move aimed at expanding ADM into health-oriented food sectors.<ref name=Almeida20>Template:Cite news</ref>

ADM announced the appointment of current CEO Juan R. Luciano on November 5, 2014.<ref>Template:Cite web</ref> Luciano initially joined the company in 2011 as chief operating officer.<ref name=Cancino14></ref> Under Luciano's leadership, the company restructured its business segments and pursued an aggressive strategy of acquisitions that expanded its human and animal nutrition business.<ref name=ReutersQuote>Template:Cite news</ref> In October 2015, ADM announced the sale of its global cocoa business to Olam International. The sale was valued at about $1.2 billion.<ref>Template:Cite news</ref> Approximately 1,500 employees transferred to Olam with the sale.<ref>Template:Cite web</ref> In January 2017, ADM agreed to sell its crop risk services (insurance) unit to Validus Holdings for $127.5 million.<ref>Template:Cite news</ref>

In October 2016, ADM launched its venture capital arm, ADM Ventures, which focused initially on alternative proteins.<ref name=NunesQuote>Template:Cite news</ref>

The Wall Street Journal reported in January 2018 that ADM had approached Bunge Ltd. about a takeover, with details "unclear" at the time.<ref name=Mattioli18>Template:Cite news</ref> At that point, Bunge had a market value of about $9.8 billion, and was also being pursued by Glencore PLC for acquisition, since May 2017.<ref name="wsj-bunge">Template:Cite news</ref> In January 2019, Juan Luciano clarified the company didn't need a "monster transformational transaction" and a deal was never made.<ref name=Huffstutter19>Template:Cite news</ref>

In March 2018, ADM restructured its business segments into four units: carbohydrate solutions, nutrition, oilseeds, and origination or ag services.<ref name=Huffstutter>Template:Cite news</ref> The next year, the company announced it was consolidating the ag services and oilseed units.<ref name=Kiernan-Stone2019>Template:Cite news</ref>

In September 2021, ADM acquired a 75% stake in four pet food companies for a total of $450 million, including PetDine, Pedigree Ovens, NutraDine, and The Pound Bakery.<ref name=Miller21>Template:Cite web</ref> Later that year in November, ADM acquired Serbian soy agribusiness Sojaprotein,<ref name=Donley21>Template:Cite news</ref> and completed its acquisition of Deerland Probiotics & Enzymes.<ref name=Schroeder2021>Template:Cite news</ref>

In 2022, ADM saw rising profits due to the Russian invasion of Ukraine and the global food crisis.<ref>Template:Cite news</ref>

Environmental record

Template:See also The company has been the subject of several major federal lawsuits related to air pollution. In 2001, it agreed to pay a $1.46 million fine for violating federal and Illinois clean-air regulations at its Decatur feed plant and to spend $1.6 million to reduce air pollution there.<ref>"Archer Daniels Fined Over Clean-Air Rules". Los Angeles Times. January 13, 2001.</ref> In 2003, the company settled federal air pollution complaints related to its efforts to avoid New Source Review provisions of the Clean Air Act that require pollution control upgrades when a plant is modernized. The company paid $4.5 million in penalties and more than $6 million to support environmental projects. In addition, ADM agreed to eliminate more than 60,000 tons of emissions of carbon monoxide, particulate matter, volatile organic compounds, and other pollutants from 42 plants in 17 states, at a cost of hundreds of millions of dollars.<ref>Lee, Jennifer 8. (April 9, 2003). "2 Companies Said to Agree to Settle Suits on Emission". The New York Times. Retrieved July 24, 2013.</ref>

Carbon footprint

ADM reported Total CO₂e emissions (Direct + Indirect) for the twelve months ending December 2022 at 15,630 Kt (-370 year over year).<ref>Template:Cite web</ref> In April 2020, ADM announced that by 2035, the company intends to have reduced its greenhouse gas emissions by 25%, and its energy intensity by 15%.<ref name=Curtis35>Template:Cite news</ref>

Archer-Daniels-Midland Company's annual Total CO₂e Emissions - Location-Based Scope 1 + Scope 2 (in kilotonnes)

Dec 2017	Dec 2018	Dec 2019	Dec 2020	Dec 2021	Dec 2022
17,471<ref>Template:Cite web Alt URL</ref>	17,363<ref>Template:Cite web Alt URL</ref>	17,800<ref>Template:Cite web</ref>	16,230<ref name="Archer-Daniels-Midland Company Total CO2e emissions for 2020Q4">Template:Cite web Alt URL</ref>	16,000<ref>Template:Cite web Alt URL</ref>	15,630<ref>Template:Cite web</ref>

Underground Template:CO2 storage

The American Recovery and Reinvestment Act of 2009, the economic stimulus package developed in response to the Great Recession, included a $3.4 billion allocation for the Department of Energy's office of fossil fuel, the majority of which was slated for the Industrial Carbon Capture and Storage (ICCS) program.<ref name=Gardner2009>Template:Cite news</ref> Through this ICCS initiative,<ref name=Gollakota>Template:Cite journal</ref> the Department of Energy co-sponsored two large-scale capture and storage projects at ADM facilities in Illinois.<ref name=LusvardiQuoteOne>Template:Cite news</ref> These projects were intended to test the feasibility of underground disposal of carbon dioxide emissions.<ref name=Finley>Template:Cite journal</ref>

In November 2011, the first of these projects, the Illinois Basin - Decatur Project (IBDP), began operation.<ref name=PSI2011>Template:Cite news</ref> The project involved injecting carbon captured at an ADM biofuel facility into Mount Simon Sandstone, a saline reservoir.<ref name=Finley/> This project was carried out by the Midwest Geological Sequestration Consortium at the University of Illinois.<ref name=Finley/> The Department of Energy provided $66.7 million in funding, with other funding coming from private partners.<ref name=MITDecatur>Template:Cite news</ref>

After three years of injection, it was determined that the sandstone was accepting Template:CO2 in an easier fashion than was originally expected.<ref name=MITDecatur/> In 2017, operations began on a larger project, the Illinois Industrial Carbon Capture and Storage Project (IL-CCS),<ref name=LusvardiQuoteTwo>Template:Cite news</ref> which again involved injecting carbon into Mount Simon Sandstone, but this time at a different location and at a much higher volume.<ref name=MITIllinois>Template:Cite news</ref> Whereas the first project involved injecting one million tons of carbon underground over three years, the IL-CCS project involved storing that same amount in only one year.<ref name=MITIllinois/> The Department of Energy contributed $141 million to the project, while the private sector cost share amounted to over $66 million.<ref name=LusvardiQuoteThree>Template:Cite news</ref> Other partners included Richland Community College and the Illinois State Geological Survey.<ref name=LusvardiQuoteThree/>

In November 2020, Investigate Midwest reported that the Illinois Industrial Carbon Capture and Storage Project had not reached its milestone of one million tons stored and had only stored approximately half that amount, and that carbon emissions from the Decatur facility had actually increased from 4.2 million tons of carbon dioxide in 2016, the year before the project launched, to 4.4 million in 2019.<ref name=Hettinger20>Template:Cite web</ref> The United States Department of Energy responded that the agency wasn't concerned about the project reaching the stated goals, as ADM successfully demonstrated that the storage technologies work and could be utilized for future projects.<ref name=Hettinger20/>

In August 2021, ADM announced that its US flour milling operations had achieved net carbon neutral status, in part due to the Decatur capture and storage project.<ref name=Crawford21>Template:Cite news</ref>

In March 2023, the Decatur City Council voted unanimously to allow ADM to expand its carbon sequestration program onto city land,<ref name=Moore23>Template:Cite web</ref> with the company paying the city $450 per acre of land.<ref name=Nelson23>Template:Cite news</ref> The agreement enabled ADM to inject liquified carbon dioxide into "pore space" 1.25 miles under land owned by the city of Decatur.<ref name=Nelson23/> On September 19, 2023, the EPA issued a Proposed Enforcement Order to Archer Daniels Midland Co., following a previously issued Notice of Violation of the Safe Drinking Water Act.<ref name=EPA0924>Template:Cite web</ref> Roughly 8,000 metric tons of liquid carbon dioxide and other ground fluids were leaked, equivalent to approximately three days worth of fluid injection according to ADM.<ref name=CapNews0924>Template:Cite web</ref> According to ADM, an inspection of the facility uncovered additional anomalies,<ref name=ADMinspect>Template:Cite web</ref> and injections were suspended pending further investigation.<ref name=ADMstop>Template:Cite web</ref>

Regenerative agriculture

In September 2022, PepsiCo and ADM established a partnership on regenerative agriculture projects that would increase the practice across their North American supply chains and help the companies meet carbon reduction goals.<ref name="Doering">Template:Cite news</ref> In July 2023, ADM launched an expansion of the program, which offers producers financial incentives and technical support to implement regenerative practices.<ref name="Donley">Template:Cite news</ref> As of December 2023, the company had allocated nearly 2 million acres of land within its supply chain for the program.<ref name="Marston">Template:Cite news</ref>

Products

Products include oils and meal from soybeans, cottonseed, sunflower seeds, canola, peanuts, flaxseed, Palm kernel, and DAG oil, as well as corn germ, corn gluten feed pellets, syrup, starch, glucose, dextrose, crystalline dextrose, high fructose corn syrup sweeteners, chocolate, ethanol, and wheat flour. End uses are consumption by people, livestock, and additives for fuel. In January 2008, ADM signed a three-year memorandum of understanding with Daimler AG and Bayer CropScience to explore the use of jatropha as a feedstock for biofuel.<ref>Template:Cite news</ref><ref>Template:Cite web</ref> Natural flavors were added to ADM's product portfolio with the 2014 acquisition of Wild Flavors<ref>Template:Cite news</ref> and vanilla products were added through the acquisition of Rodelle in 2018.<ref>Template:Cite web</ref>

Long known as a food and ingredients company, it has also invested in fuel production. ADM nearly doubled capital spending in its 2007 budget to an estimated $1.12 billion. The increase is planned for bioenergy projects, focusing on bioethanol and biodiesel.<ref>Fusaro, Dave (March 26, 2007). "ADM’s big bet on fuel". Food Processing . Retrieved June 6, 2007.</ref>

Oilseeds processing

The oilseeds processing segment includes global activities related to the origination, merchandising, crushing, and further processing of oilseeds such as soybeans and soft seeds (cottonseed, sunflower seed, canola, and flaxseed) into vegetable oils and protein meals.<ref name="sec.gov">Template:Cite web</ref>

The first quarter of 2020, during the COVID-19 pandemic, saw the operating profit of Ag Services and Oilseeds (ADM's biggest revenue segment) rise $422 million, or 1.2%.<ref>Template:Cite web</ref>

Corn processing

ADM's corn processing segment is engaged in corn wet milling and dry milling activities, with its asset base primarily located in the central part of the United States. The Corn Processing segment converts corn into sweeteners and starches, and bioproducts. Its products include ingredients used in the food and beverage industry including sweeteners, starch, syrup, glucose (dextrose). Dextrose and starch are used by the Corn Processing segment as feedstocks for its bioproducts operations.<ref name="sec.gov" /> In 2021, ADM was ranked second on the Top 50 Global Sweetener Companies list by FoodTalks.<ref>Template:Cite web</ref>

Agricultural services

ADM mix plant in Spokane, Washington

ADM's agricultural services segment uses its U.S. grain elevator, global transportation network, and port operations to buy, store, clean, and transport agricultural commodities, such as oilseeds, corn, wheat, milo, oats, rice, and barley, and resells these commodities primarily as food and feed ingredients and as raw materials for the agricultural processing industry.<ref name="sec.gov" />

Investor services

ADM investor services, Inc. is a registered futures commission merchant and a clearing member of all principal commodities exchanges in the U.S. ADM Investor Services International, Ltd., a member of commodity exchanges and clearing houses in Europe, and ADMIS Hong Kong Limited, offer broker services in Europe and Asia.<ref name="sec.gov" />

Scandals

Sherman antitrust violation

In 1920 the US Department of Justice brought suit against the National Linseed Oil Trust for violating the Sherman Antitrust Act. Several co-defendants were named, including the Archer-Daniels Manufacturing Company. The suit alleged all of these companies were acting in collusion to raise prices, citing a spike in linseed oil costs between 1916 and 1918, when the price rose from $.50 per gallon to $1.80.<ref>"Sues to dissolve Trust", New York Times. July 1, 1920. Retrieved 7/26/2015.</ref>

Price fixing

Template:See also In 1993, the company was the subject of a lysine price-fixing investigation by the U.S. Justice Department. Senior ADM executives were indicted on criminal charges for engaging in price-fixing within the international lysine market. In a tape played at the trial, ADM's President said that a single phrase inspired the company: "Our competitors are our friends. Our customers are the enemy."<ref>Template:Cite web</ref> Three of ADM's top officials, including vice chairman Michael Andreas were eventually sentenced to federal prison in 1999. Moreover, in 1997, the company was fined $100 million, the largest antitrust fine in U.S. history at the time.<ref>Template:Cite web</ref> Mark Whitacre, FBI informant and whistleblower of the lysine price-fixing conspiracy, would also find himself in legal trouble for embezzling money from ADM during his time as an informant for the FBI. In addition ADM's 2005 annual report revealed that earlier that year the company settled a class-action antitrust suit for a payment of $400 million.<ref>Template:Cite web</ref> The Informant is a nonfiction thriller book based on this event, which was later adapted into the 2009 film The Informant!.<ref>Template:Cite web</ref>

Tax dodging

A noteworthy case of transfer mispricing came to light in 2011 in Argentina involving the world's four largest grain traders: ADM, Bunge, Cargill and LDC. Argentina's revenue and customs service began an investigation into the four companies when prices for agricultural commodities spiked in 2008 and yet very little profit for the four companies had been reported to the office. As a result of the investigation, it was alleged that the companies had submitted false declarations of sales and routed profits through tax havens or through their headquarters. In some cases, they were said to have used phantom firms to buy grain and had inflated costs in Argentina in order to reduce the recorded profits earned in the country.<ref>Template:Cite news</ref> According to the country's revenue and customs service, the outstanding taxes amounted to almost US$1 billion.<ref>Template:Cite news</ref> The companies involved have denied the allegations. To date, the Argentinian tax authorities have not replied to the Swiss NGO Public Eye’s request regarding the current state of the case.<ref>Template:Cite news</ref> In its 2018 annual report to the US Securities and Exchange Commission (SEC), Bunge mentioned provisions which suggest that the case is still ongoing: "[A]s of December 31, 2018, Bunge's Argentine subsidiary had received income tax assessments relating to 2006 through 2009 of approximately 1,276 million Argentine pesos (approximately $34 million), plus applicable interest on the outstanding amount of approximately 4,246 million Argentine pesos (approximately $113 million<ref>Template:Cite web</ref>)."<ref>Template:Cite web</ref>

Violation of the Foreign Corrupt Practices Act

On December 20, 2013, the SEC announced that it had charged ADM for failing to prevent illicit payments (bribes) made by its foreign subsidiaries to Ukrainian government officials in violation of the FCPA. Alfred C. Toepfer International Ukraine Ltd. (ACTI Ukraine), plead guilty in the Central District of Illinois to one count of conspiracy in violation of the anti-bribery sections of the FCPA. They agreed to pay $17.8 million in fines. The Department of Justice also entered into a non-prosecution agreement with ADM due to the company's failure to implement a system of internal financial controls, addressing improper payments both in Ukraine and by an ADM joint venture in Venezuela. ADM agreed to pay more than $36 million to settle the SEC's charges, bringing the total amount paid to over $54 million.<ref name="SEC Charges Archer-Daniels-Midland Company with FCPA Violations">Template:Cite web</ref><ref>Template:Cite web</ref>

The Swiss NGO Public Eye elaborated the case.<ref>Template:Cite news</ref><ref name="justice.gov">Template:Cite web</ref>

Sonny Perdue land sale

In 2021, an investigation by the Washington Post found that ADM had sold land to incoming Secretary of Agriculture Sonny Perdue in 2017 at a fraction of its estimated value. Ethics lawyers had legal and ethical concerns about the sale, questioning whether it amounted to bribery. According to the Post, ADM "sold the land at a small fraction of its estimated value just as it stood to benefit from a friendly secretary of agriculture."<ref>Template:Cite news</ref>

Accounting practices

In 2020, ADM's board agreed to have bonuses of senior executives tied to the nutrition segment's success—a unit which accounts for less than 10 percent of the company's revenue—replacing the standard practice of tying the award to adjusted earnings. In January 2023, its seven top executives collectively received shares worth about $72 million for exceeding those performance metrics.<ref>Template:Cite news</ref><ref>Template:Cite news</ref>

In January 2024, ADM disclosed that the SEC requested information regarding its accounting practices at its nutrition business on "intersegment transactions." ADM suspended its CFO, postponed its quarterly earnings report and annual filings, and said it was cooperating with the SEC investigation.<ref>Template:Cite web</ref> In March 2024, FBI agents delivered grand jury subpoenas to current and former employees of ADM, authorized by officials at the U.S. attorney's Manhattan office.<ref>Template:Cite web</ref>

See also

• List of Illinois companies
• List of S&P 500 companies

External links

• Template:Official

• Template:Cite web
• Template:Cite book