Archer Daniels Midland Co. reported third-quarter net income of $536 million, exceeding market expectations.
Archer Daniels Midland (ADM) reported higher-than-expected quarterly profit, as the U.S. grain merchant cashed in on strong oilseed crushing margins and export sales of American corn. ADM also said it’s been able to find customers outside of China, especially for corn, after Beijing slapped a 25 percent tariff on U.S. soybeans earlier this year. Net profit attributable to ADM surged to $536 million, or 94 cents per share, from $192 million, or 34 cents, a year earlier. Excluding one-time items, the company earned 92 cents per share, beating analysts’ average estimate of 83 cents, according to IBES data from Refinitiv. Revenue rose to $15.80 billion from $14.83 billion. Shares rose slightly to $48.16.
Export demand for U.S. crops came from countries other than China, ADM said, as an escalating trade war between the U.S. and China curtailed shipments of U.S. farm products, including soybeans and sorghum, to the Asian nation. Sales to other buyers help offset the sting of the trade row, which has reordered the global grains business. China, the world’s top soy importer, has been buying soybeans from Brazil after Beijing imposed a tariff on U.S. imports in July. It may not need to turn back to the United States before South America harvests its next crop, ADM Chief Executive Officer Juan Luciano said. “Certainly we’re not going to have the China demand pool, but the rest of the world will be coming to us, particularly for corn,” Luciano said on a conference call. China is not a frequent importer of U.S. corn, but droughts in Brazil and Argentina have made buyers more reliant on the United States.