The
Archer Daniels Midland Company (ADMC) is a
Fortune 500 conglomerateA conglomerate is a combination of two or more corporations engaged in entirely different businesses that fall under one corporate structure , usually involving a parent company and several subsidiaries. Often, a conglomerate is a multi-industry company...
headquartered in
Decatur, IllinoisDecatur is the largest city and the county seat of Macon County in the U.S. state of Illinois. The city, sometimes called "the Soybean Capital of the World", was founded in 1823 and is located along the Sangamon River and Lake Decatur in Central Illinois. In 2000 the city population was 81,500,...
. ADM operates more than 270 plants worldwide, where
cerealCereals are grasses cultivated for the edible components of their grain , composed of the endosperm, germ, and bran...
grains and oilseeds are processed into products used in
foodFood is any substance consumed to provide nutritional support for the body. It is usually of plant or animal origin, and contains essential nutrients, such as carbohydrates, fats, proteins, vitamins, or minerals...
, beverage,
nutraceuticalNutraceutical, a portmanteau of the words “nutrition” and “pharmaceutical”, is a food or food product that reportedly provides health and medical benefits, including the prevention and treatment of disease. Health Canada defines the term as "a product isolated or purified from foods that is...
,
industrialIndustry refers to the production of an economic good or service within an economy.-Industrial sectors:There are four key industrial economic sectors: the primary sector, largely raw material extraction industries such as mining and farming; the secondary sector, involving refining, construction,...
and
animalAnimals are a major group of multicellular, eukaryotic organisms of the kingdom Animalia or Metazoa. Their body plan eventually becomes fixed as they develop, although some undergo a process of metamorphosis later on in their life. Most animals are motile, meaning they can move spontaneously and...
feedFodder or animal feed is any agricultural foodstuff used specifically to feed domesticated livestock such as cattle, goats, sheep, horses, chickens and pigs. Most animal feed is from plants but some is of animal origin...
markets worldwide.
ADM was named the
world's most admired food production company by
Fortune magazine for 3 consecutive years; 2009, 2010, 2011.
ADM also provides
agriculturalAgriculture is the cultivation of animals, plants, fungi and other life forms for food, fiber, and other products used to sustain life. Agriculture was the key implement in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that nurtured the...
storage and
transportTransport or transportation is the movement of people, cattle, animals and goods from one location to another. Modes of transport include air, rail, road, water, cable, pipeline, and space. The field can be divided into infrastructure, vehicles, and operations...
ation services. The
American River Transportation CompanyThe American River Transportation Company, or ARTCO, is a subsidiary of the Archer Daniels Midland company. ARTCO manages the transportation of ADM products along the Mississippi River, Ohio River, and Illinois River in the United States...
along with ADM Trucking, Inc are subsidiaries of ADM. ADM's
revenueIn business, revenue is income that a company receives from its normal business activities, usually from the sale of goods and services to customers. In many countries, such as the United Kingdom, revenue is referred to as turnover....
s for fiscal year 2011 were
USThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
$81 billion.
Products
Products include oils and
mealFlour is a powder which is made by grinding cereal grains, other seeds or roots . It is the main ingredient of bread, which is a staple food for many cultures, making the availability of adequate supplies of flour a major economic and political issue at various times throughout history...
from
soybeanThe soybean or soya bean is a species of legume native to East Asia, widely grown for its edible bean which has numerous uses...
s,
cottonCotton is a soft, fluffy staple fiber that grows in a boll, or protective capsule, around the seeds of cotton plants of the genus Gossypium. The fiber is almost pure cellulose. The botanical purpose of cotton fiber is to aid in seed dispersal....
seed,
sunflowerSunflower is an annual plant native to the Americas. It possesses a large inflorescence . The sunflower got its name from its huge, fiery blooms, whose shape and image is often used to depict the sun. The sunflower has a rough, hairy stem, broad, coarsely toothed, rough leaves and circular heads...
seeds,
canolaCanola refers to a cultivar of either Rapeseed or Field Mustard . Its seeds are used to produce edible oil suitable for consumption by humans and livestock. The oil is also suitable for use as biodiesel.Originally, Canola was bred naturally from rapeseed in Canada by Keith Downey and Baldur R...
,
peanutThe peanut, or groundnut , is a species in the legume or "bean" family , so it is not a nut. The peanut was probably first cultivated in the valleys of Peru. It is an annual herbaceous plant growing tall...
s, flaxseed, and
Diacylglycerol (DAG) oilDiacylglycerol oil is a cooking oil in which the ratio of triglycerides to DAG is shifted to contain mostly DAG, unlike conventional cooking oils, which are rich in TAG...
, as well as
corn germThe germ of a cereal is the reproductive part that germinates to grow into a plant; it is the embryo of the seed. Along with bran, germ is often a by-product of the milling that produces refined grain products. Cereal grains and their components, such as wheat germ, rice bran, and maize may be used...
, corn gluten feed pellets,
syrupIn cooking, a syrup is a thick, viscous liquid consisting primarily of a solution of sugar in water, containing a large amount of dissolved sugars but showing little tendency to deposit crystals...
,
starchStarch or amylum is a carbohydrate consisting of a large number of glucose units joined together by glycosidic bonds. This polysaccharide is produced by all green plants as an energy store...
,
glucoseGlucose is a simple sugar and an important carbohydrate in biology. Cells use it as the primary source of energy and a metabolic intermediate...
, dextrose, crystalline dextrose,
High fructose corn syrupHigh-fructose corn syrup — also called glucose-fructose syrup in the UK, glucose/fructose in Canada, and high-fructose maize syrup in other countries — comprises any of a group of corn syrups that has undergone enzymatic processing to convert some of its glucose into fructose to produce...
sweetenersA sugar substitute is a food additive that duplicates the effect of sugar in taste, usually with less food energy. Some sugar substitutes are natural and some are synthetic. Those that are not natural are, in general, called artificial sweeteners....
, cocoa liquor, cocoa powder,
cocoa butterCocoa butter, also called theobroma oil, is a pale-yellow, pure edible vegetable fat extracted from the cocoa bean. It is used to make chocolate, biscuits, and baked goods, as well as some pharmaceuticals, ointments, and toiletries...
,
chocolateChocolate is a raw or processed food produced from the seed of the tropical Theobroma cacao tree. Cacao has been cultivated for at least three millennia in Mexico, Central and South America. Its earliest documented use is around 1100 BC...
,
ethanolEthanol, also called ethyl alcohol, pure alcohol, grain alcohol, or drinking alcohol, is a volatile, flammable, colorless liquid. It is a psychoactive drug and one of the oldest recreational drugs. Best known as the type of alcohol found in alcoholic beverages, it is also used in thermometers, as a...
, and
wheatWheat is a cereal grain, originally from the Levant region of the Near East, but now cultivated worldwide. In 2007 world production of wheat was 607 million tons, making it the third most-produced cereal after maize and rice...
flourFlour is a powder which is made by grinding cereal grains, other seeds or roots . It is the main ingredient of bread, which is a staple food for many cultures, making the availability of adequate supplies of flour a major economic and political issue at various times throughout history...
. End uses are consumption by people,
livestockLivestock refers to one or more domesticated animals raised in an agricultural setting to produce commodities such as food, fiber and labor. The term "livestock" as used in this article does not include poultry or farmed fish; however the inclusion of these, especially poultry, within the meaning...
, and
fuelFuel is any material that stores energy that can later be extracted to perform mechanical work in a controlled manner. Most fuels used by humans undergo combustion, a redox reaction in which a combustible substance releases energy after it ignites and reacts with the oxygen in the air...
additives.
Long known as a food and ingredients company, ADM recently 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
biodieselBiodiesel refers to a vegetable oil- or animal fat-based diesel fuel consisting of long-chain alkyl esters. Biodiesel is typically made by chemically reacting lipids with an alcohol....
.
History
In 1902,
George A. ArcherGeorge A. Archer owned a 50-percent interest in Daniels Linseed Co. and a controlling interest in American Linseed Company, which evolved into Archer Daniels Midland.-Footnotes:...
and
John W. DanielsJohn W. Daniels was the founder of Daniels Linseed Co., which evolved into Archer Daniels Midland.-Footnotes:...
began a linseed crushing business. In 1923, Archer-Daniels Linseed Company acquired Midland Linseed Products Company, and the Archer Daniels Midland Company was formed. Every decade since its corporate inception, ADM has added at least one major profit source to its agribusiness: milling, processing,
specialty food ingredientsSpecialty Food IngredientsSpecialty food ingredients typically preserve, texture, emulsify, colour, help processing and in some cases add an extra health dimension to produced food. These ingredients are essential in providing today’s consumer with a wide range of processed foods...
, cocoa, nutrition, and more.
In 1971
Dwayne AndreasDwayne Orville Andreas is one of the most prominent political campaign donors in the United States, having contributed millions of dollars to Democratic and Republican candidates alike...
became Chief Executive Officer of ADM, and is credited with transforming the firm into an industrial powerhouse. Andreas remained CEO until 1997. He was one of the most prominent political campaign donors in the
United StatesThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
, having contributed millions of dollars to Democratic and Republican candidates alike.
In September 1999, executive Marty Andreas announced, under pressure from the European agricultural industry, they were going to separate crops into
genetically modifiedA genetically modified organism or genetically engineered organism is an organism whose genetic material has been altered using genetic engineering techniques. These techniques, generally known as recombinant DNA technology, use DNA molecules from different sources, which are combined into one...
and non-genetically modified groups to give their customers a choice. Previously the company had not disclosed their crop sources.
In 2001, Paul B. Mulhollem became the President of ADM. The Archer Daniels Midland Company made history by becoming the first U.S. company to sign a contract with Cuba since the embargo against Cuba was imposed October 1960.
In May 2006,
Patricia A. WoertzPatricia Ann Woertz became CEO of Archer Daniels Midland in 2006, beating out 4 other competitors. Formerly an Executive Vice President at Chevron Corporation, Woertz left to pursue CEO opportunities...
became CEO. Formerly of
ChevronChevron Corporation is an American multinational energy corporation headquartered in San Ramon, California, United States and active in more than 180 countries. It is engaged in every aspect of the oil, gas, and geothermal energy industries, including exploration and production; refining,...
, she is expected to focus on developing
ethanolEthanol, also called ethyl alcohol, pure alcohol, grain alcohol, or drinking alcohol, is a volatile, flammable, colorless liquid. It is a psychoactive drug and one of the oldest recreational drugs. Best known as the type of alcohol found in alcoholic beverages, it is also used in thermometers, as a...
and
biofuelBiofuel is a type of fuel whose energy is derived from biological carbon fixation. Biofuels include fuels derived from biomass conversion, as well as solid biomass, liquid fuels and various biogases...
s. In February 2007 Ms. Woertz was elected Chairman of the Board at ADM.
On 22 August 2011, Archer Daniels Midland announced that the
soybeanThe soybean or soya bean is a species of legume native to East Asia, widely grown for its edible bean which has numerous uses...
processing facility in
Galesburg, IllinoisGalesburg is a city in Knox County, Illinois, in the United States. As of the 2010 census, the city population was 32,195. It is the county seat of Knox County....
was closing immediately, and its operations would be transferred to other ADM oilseeds facilities. The facility has been idle since April 2011. Some of the 31 employees will be offered the opportunity to transfer to other ADM facilities.
Price fixing
In 1993, ADM was the subject of a
lysine price fixingThe lysine price-fixing conspiracy was an organized effort during the mid-1990s to raise the price of the animal feed additive lysine. It involved five companies that had commercialized high-tech fermentation technologies, including American company Archer Daniels Midland , Japanese companies...
investigation by the
U.S. Justice DepartmentThe United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
. Senior ADM executives were indicted on criminal charges for engaging in
price-fixingPrice fixing is an agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level by controlling supply and demand...
within the international
lysineLysine is an α-amino acid with the chemical formula HO2CCH4NH2. It is an essential amino acid, which means that the human body cannot synthesize it. Its codons are AAA and AAG....
market. 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.
Mark WhitacreMark Edward Whitacre came to public attention in 1995 when, as president of the BioProducts Division at Archer Daniels Midland , he was the highest-level corporate executive in U.S. history to become a Federal Bureau of Investigation whistleblower...
, FBI informant and whistleblower of the
Lysine price-fixing conspiracyThe lysine price-fixing conspiracy was an organized effort during the mid-1990s to raise the price of the animal feed additive lysine. It involved five companies that had commercialized high-tech fermentation technologies, including American company Archer Daniels Midland , Japanese companies...
would also find himself in legal trouble for embezzling money from ADM during his time as an informant for the FBI. In addition, according to ADM's 2005 annual report a settlement was reached under which ADM paid $400 million in 2005 to settle a class action antitrust suit.
Using the investigation as an example, Ronald W. Cotterill of the Food Marketing Policy Center at the
University of ConnecticutThe admission rate to the University of Connecticut is about 50% and has been steadily decreasing, with about 28,000 prospective students applying for admission to the freshman class in recent years. Approximately 40,000 prospective students tour the main campus in Storrs annually...
shows that 100 percent or more of overcharges resulting from price fixing are passed through to consumers.
The Informant is a nonfiction thriller book written by journalist
Kurt EichenwaldKurt Alexander Eichenwald , an American writer and investigative reporter formerly with The New York Times and later with Condé Nast's business magazine, Portfolio...
and published in 2000 by
Random HouseRandom House, Inc. is the largest general-interest trade book publisher in the world. It has been owned since 1998 by the German private media corporation Bertelsmann and has become the umbrella brand for Bertelsmann book publishing. Random House also has a movie production arm, Random House Films,...
that documents the mid-1990s
lysine price-fixing conspiracyThe lysine price-fixing conspiracy was an organized effort during the mid-1990s to raise the price of the animal feed additive lysine. It involved five companies that had commercialized high-tech fermentation technologies, including American company Archer Daniels Midland , Japanese companies...
case and the involvement of Archer Daniels Midland executive
Mark WhitacreMark Edward Whitacre came to public attention in 1995 when, as president of the BioProducts Division at Archer Daniels Midland , he was the highest-level corporate executive in U.S. history to become a Federal Bureau of Investigation whistleblower...
. A 2009 movie adaptation of the book stars
Matt DamonMatthew Paige "Matt" Damon is an American actor, screenwriter, and philanthropist whose career was launched following the success of the film Good Will Hunting , from a screenplay he co-wrote with friend Ben Affleck...
as
Mark WhitacreMark Edward Whitacre came to public attention in 1995 when, as president of the BioProducts Division at Archer Daniels Midland , he was the highest-level corporate executive in U.S. history to become a Federal Bureau of Investigation whistleblower...
.
Environmental record
Archer Daniels Midland has been the subject of several major federal lawsuits related to air pollution. In 2001 the company 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.
In 2003, ADM settled federal air pollution complaints related to the company's efforts to avoid
New Source ReviewThe New Source Review, is a permitting process created by the US Congress in 1977 as part of a series of amendments to the Clean Air Act. The NSR process requires industry to undergo an Environmental Protection Agency pre-construction review for environmental controls if they propose either...
provisions of the
Clean Air ActA Clean Air Act is one of a number of pieces of legislation relating to the reduction of airborne contaminants, smog and air pollution in general. The use by governments to enforce clean air standards has contributed to an improvement in human health and longer life spans...
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, organic volatile chemicals and other pollutants from 42 plants in 17 states at a cost of hundreds of millions of dollars.
Archer Daniels Midland Company is involved in a joint project with Daimler AG and Bayer CropScience to develop
jatrophaJatropha is a genus of approximately 175 succulent plants, shrubs and trees , from the family Euphorbiaceae. The name is derived from the Greek words ἰατρός , meaning "physician," and τροφή , meaning "nutrition," hence the common name physic nut. Mature plants produce separate male and female...
as a
biofuelBiofuel is a type of fuel whose energy is derived from biological carbon fixation. Biofuels include fuels derived from biomass conversion, as well as solid biomass, liquid fuels and various biogases...
.
In an attempt to reduce its carbon footprint, ADM has teamed up with the Midwest Geological Sequestration Association and other organizations to test the disposal of carbon dioxide emissions underground. If testing is successful, beginning in late 2010 ADM expects to dispose of 1,000 metric tons per day of carbon dioxide emissions currently being released to the atmosphere.
ADM is a major purchaser and trader of agricultural commodities grown in former rainforests
Agricultural subsidies
ADM lobbies for
agricultural subsidiesAn agricultural subsidy is a governmental subsidy paid to farmers and agribusinesses to supplement their income, manage the supply of agricultural commodities, and influence the cost and supply of such commodities...
and price supports including sugar and ethanol. According to a 1995 report by the
Cato InstituteThe Cato Institute is a libertarian think tank headquartered in Washington, D.C. It was founded in 1977 by Edward H. Crane, who remains president and CEO, and Charles Koch, chairman of the board and chief executive officer of the conglomerate Koch Industries, Inc., the largest privately held...
, "ADM has cost the American economy billions of dollars since 1980 and has indirectly cost Americans tens of billions of dollars in higher prices and higher taxes over that same period. At least 43 percent of ADM's annual profits are from products heavily subsidized or protected by the American government. Moreover, every $1 of profits earned by ADM's corn sweetener operation costs consumers $10, and every $1 of profits earned by its bioethanol operation costs taxpayers $30."
External links