Archer Daniels Midland 2009 Annual Report Download - page 29

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23
Item 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Analysis of Statements of Earnings
Net sales and other operating income decreased 1% to $69.2 billion due to foreign exchange translation impacts
and decreased sales volumes partially offset by higher average selling prices. Net sales and other operating income
increased $3.0 billion due to higher average selling prices primarily related to higher underlying commodity costs,
decreased $2.0 billion due to foreign exchange translation impacts, and decreased $1.6 billion due to lower sales
volumes and other.
Net sales and other operating income by segment are as follows:
2009
2008
Change
(In millions)
Oilseeds Processing
Crushing & Origination
$ 15,579
$ 14,477
$ 1,102
Refining, Packaging, Biodiesel & Other
8,760
8,588
172
Asia
179
214
(35)
Total Oilseeds Processing
24,518
23,279
1,239
Corn Processing
Sweeteners & Starches
3,785
3,546
239
Bioproducts
3,938
3,591
347
Total Corn Processing
7,723
7,137
586
Agricultural Services
Merchandising & Handling
31,342
33,749
(2,407)
Transportation
242
219
23
Total Agricultural Services
31,584
33,968
(2,384)
Other
Wheat, Cocoa, Malt & Sugar
5,272
5,335
(63)
Financial
110
97
13
Total Other
5,382
5,432
(50)
Total
$ 69,207
$ 69,816
$ (609)
Oilseeds Processing sales increased 5% to $24.5 billion due principally to increased sales volumes of merchandised
oilseeds and biodiesel partially offset by lower sales volumes of vegetable oil and protein meal. Corn Processing
sales increased 8% to $7.7 billion due principally to higher sales volumes of ethanol and higher average selling
prices of sweeteners and starches, partially offset by lower average selling prices of ethanol. Agricultural Services
sales decreased 7% to $31.6 billion due principally to lower sales volumes of grain. Other sales decreased 1% to
$5.4 billion primarily due to the sale of the Company’s malting business during the first quarter of fiscal year 2009
and lower average selling prices of wheat flour. Partially offsetting these decreases were higher average selling
prices of cocoa products and increased chocolate sales volumes.
Cost of products sold decreased 1% to $65.1 billion, in line with the decrease in net sales and other operating
income. Cost of products sold decreased $856 million due principally to decreased sales volumes, decreased LIFO
inventory valuations and approximately $1.9 billion from the impact of foreign currency translation, partially offset
by increased agricultural commodity costs. Manufacturing expenses decreased $215 million primarily due to
decreased energy and fuel costs.