Archer Daniels Midland 2007 Annual Report Download - page 12

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4
PART I
Item 1. BUSINESS
Company Overview
Archer Daniels Midland Company (the Company) was incorporated in Delaware in 1923, successor to the
Daniels Linseed Co. founded in 1902. The Company is a world leader in BioEnergy and has a premier position
in the agricultural processing value chain. The Company is one of the world’s largest processors of oilseeds,
corn, wheat, and cocoa and is a leading manufacturer of biodiesel, ethanol, soybean oil and meal, corn
sweeteners, flour, and other value-added food and feed ingredients. The Company also has an extensive grain
elevator and transportation network to buy, store, clean, and transport agricultural commodities, such as oilseeds,
corn, wheat, milo, oats, and barley.
During the last five years, the Company has experienced significant growth, spending approximately $4.8 billion
for construction of new plants, expansions of existing plants, and the acquisitions of plants and transportation
equipment. The Company is constructing two dry corn milling plants which will increase the Company’s annual
ethanol production capacity by 550 million gallons to 1.7 billion gallons. In addition, the Company has recently
completed construction of, or is currently constructing, a polyhydroxy alkanoate (PHA) natural plastics production
facility, a propylene/ethylene glycol production facility, United States and foreign cocoa processing facilities, and
United States and foreign biodiesel production facilities. Construction of these plants is expected to be completed
during the next two fiscal years. The Company expects to spend approximately $3.0 billion to construct these
facilities and other approved capital projects over the next four years. There have been no significant dispositions
during the last five years.
Segment Descriptions
The Company’s operations are classified into three reportable business segments: Oilseeds Processing, Corn
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. Financial
information with respect to the Company’s reportable business segments is set forth in “Note 14 of Notes to
Consolidated Financial Statements” included in Item 8 herein, “Financial Statements and Supplementary Data.”
Oilseeds Processing
The Company is engaged in processing oilseeds such as soybeans, cottonseed, sunflower seeds, canola, peanuts,
and flaxseed 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. Salad oils can be further
processed by hydrogenating and/or interesterifying into margarine, shortening, and other food products. Partially
refined oil is sold for use in chemicals, paints and other industrial products. Refined oil can be further processed
for use in the production of biodiesel. Oilseed meals are primary ingredients used in the manufacture of
commercial livestock and poultry feeds. Cottonseed flour is produced and sold primarily to the pharmaceutical
industry. Cotton cellulose pulp is manufactured and sold to the chemical, paper, and filter markets.
Golden Peanut Company LLC, a joint venture between the Company and Alimenta (U.S.A.), Inc., is a major
supplier of peanuts to both the domestic and export markets. The Company has a 50% ownership interest in this
joint venture.
The Company has an ownership interest in Wilmar International Limited, a Singapore publicly listed company.
Wilmar International Limited is the largest agricultural processing business in Asia and operates palm plantations;
soybean, rapeseed, cottonseed, sunflower seed, peanut, palm kernel, and sesame seed crushing facilities and related
vegetable oil refineries and packaging facilities; an oleochemical plant that produces fatty acids, glycerin, and soap
noodles; a soy protein plant; wheat flour mills; rice mills; feed mills; fertilizer operations; and related silos and
storage facilities.