Archer-Daniels-Midland posted its lowest second-quarter profit in five years on Tuesday as U.S. trade upheaval and uncertainty around biofuel policies slowed sales and crimped trading and crop processing margins.
The company warned that full-year 2025 earnings would drop to the lowest since 2020 after a weak first half and amid ongoing challenges in global trade.
U.S.-based ADM is bracing for an impact from President Donald Trump’s sweeping tariffs on most imports, as well as any trade retaliation which often targets agricultural products.
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ADM and agribusiness peers including Bunge and Cargill have seen profits erode in recent quarters due to ample global crop supplies and thinning margins. The U.S. president’s tariff threats and shifting deadlines for duties have fueled further chaos for global grains merchants like ADM.
U.S. biofuel policy uncertainty dented demand for green energy feedstocks like corn and soybean oil, although ADM said proposed increases for biofuel blending in the U.S. should be supportive from the fourth quarter and beyond.
ADM said it expected adjusted annual earnings at about US$4.00 share in 2025, compared with previous guidance of between $4.00 and $4.75 per share and the weakest in five years.
Profit from Ag Services & Oilseeds, the company’s largest segment, slumped seven per cent to $113 million (C$155.7 million) in the reported quarter driven by lower margins. The division houses the company’s global crop trading, transportation and storage, and oilseed processing operations.
Profit in its grain origination and crushing business, which sources grains from growers and processes them for food, animal feed and other uses, fell seven per cent to $33 million (C$45.5 million).
Chicago-based ADM reported adjusted net earnings of $452 million (C$623.1 million), or 93 cents per share, for the quarter ended June 30, down from $508 million, or $1.03 per share, a year ago. Analysts, on average, expected earnings per share of 83 cents, according to data compiled by LSEG.
