Archer-Daniels Midland Co

ADM: XNYS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$43.00	Rhsd	Yjpdjcgq

Archer-Daniels Midland Will See Profits Fall as Crop Prices Fall to Midcycle Levels

Seth Goldstein

Jul 30, 2024

Business Strategy and Outlook

Archer-Daniels Midland buys, processes, and sells agricultural commodities. The firm purchases crops from farmers and then transports, stores, and/or processes the crops before selling them to food, feed, and energy buyers. The commodity products ADM moves around the world are readily available from competitors, and the company has little pricing power over the products it buys and sells, making for slim margins. In addition, the capital intensity of its operations makes it difficult, but not impossible, for ADM to generate economic profits.

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