Archer Daniels Midland 2010 Annual Report Download - page 8

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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 one of the world‘s largest processors of oilseeds, corn,
wheat, cocoa, and other agricultural commodities and is a leading manufacturer of vegetable oil and protein
meal, corn sweeteners, flour, biodiesel, ethanol, and other value-added food and feed ingredients. The Company
also has an extensive grain elevator and transportation network to procure, store, clean, and transport agricultural
commodities, such as oilseeds, corn, wheat, milo, oats, and barley, as well as processed agricultural
commodities.
During the past five years, the Company has experienced significant growth, spending approximately $7.9 billion
for construction of new plants, maintenance and expansions of existing plants, and the acquisitions of plants and
transportation equipment. The Company has recently completed construction of a coal cogeneration facility and
two corn dry milling plants which will increase the Company‘s annual ethanol production capacity by 600 million
gallons to 1.8 billion gallons. In addition, the Company has completed the initial phase of its polyhydroxy
alkanoate (PHA) bioplastic production facility, and continues to work through start up at its propylene/ethylene
glycol production facility and a new cocoa processing facility. The Company currently expects to spend
approximately $1.5 billion to complete the facilities under construction and other approved capital projects through
calendar year 2013. 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, which include wheat processing, cocoa processing, and its
financial business units are not reportable business segments, as defined by the applicable accounting standard, and
are classified as Other. Financial information with respect to the Company‘s reportable business segments is set
forth in ―Note 15 of Notes to Consolidated Financial Statements‖ included in Item 8 herein, ―Financial Statements
and Supplementary Data.‖
Oilseeds Processing
The Oilseeds Processing segment includes activities related to the origination, merchandising, crushing, and further
processing of oilseeds such as soybeans, cottonseed, sunflower seeds, canola, rapeseed, peanuts, flaxseed, and palm
into vegetable oils and protein meals. The Oilseeds Processing segment principally produces and markets
processed oilseed products as ingredients for the food, feed, energy, and other industrial products industries. Crude
vegetable oil is sold "as is" or is further processed by refining, blending, bleaching, and deodorizing into salad oils.
Salad oils are sold ―as is‖ or are further processed by hydrogenating and/or interesterifying into margarine,
shortening, and other food products. Partially refined oil is used to produce biodiesel or is sold to other
manufacturers for use in chemicals, paints, and other industrial products. Oilseed protein meals are principally sold
to third parties to be used as ingredients in commercial livestock and poultry feeds. The Oilseeds Processing
segment also produces natural health and nutrition products and other specialty food and feed ingredients. In North
America, cottonseed flour is produced and sold primarily to the pharmaceutical industry and cotton cellulose pulp
is manufactured and sold to the chemical, paper, and filter markets. In South America, the Oilseeds Processing
segment utilizes a network of grain elevators, port facilities and transportation assets to buy, store, clean, and
transport agricultural commodities and operates fertilizer blending facilities.
The Company produces a wide range of edible soy protein products including soy flour, soy grits, soy protein
concentrates and soy isolates that are used in processed meats, baked foods, nutritional products, snacks, and dairy
and meat analogs.
From co-products of oilseeds, the Company produces natural source vitamin E, tocopherol antioxidants and
phytosterols which are marketed to the dietary supplement and food industry. The Company produces soy
isoflavones, a dietary supplement, from a co-product of edible soy processing.