CPO Ingredion, Inc.

In an effort to house farmers’ higher production as well as remain focused on the growth strategy, Archer Daniels Midland Company (ADM) plans to expand three grain facilities in northeast Missouri and western Illinois.

Upon receiving approval, construction at these facilities will start this spring with completion scheduled in 2011 fall harvest.

The company’s elevators in Novelty and Center, Missouri, will increase their storage capacity by three times. Also, a barge loading terminal in Quincy, Illinois, will add grain storage and improve receiving efficiencies.

The combined storage capacity can house an additional 1.7 million bushels as well as augment corn drying capabilities and reduce truck unloading times.

Moreover, crops received at these expanded facilities will help supply Archer Daniels’ soybean processing operations in Quincy, Illinois., and Mexico, Missouri, as well as at its barge loading terminals in St. Louis, Missouri and Quincy, Illinois.

Additionally, Archer Daniels will also provide knowledge and expertise to the farmers regarding merchandisers and creative contract alternatives so that they can market their crops in the most effective and profitable way.

Archer Daniels reported robust second quarter 2011 results with net income of $1.14 per share outpacing the Zacks Consensus Estimate of 77 cents. The robust quarterly result was primarily attributable to increased segmental profit, which was partially offset by negative discrepancy from changes in Last-In-First-Out (LIFO) inventory valuations caused by higher agricultural commodity prices.

The Zacks Consensus Estimate for third-quarter 2011 is 89 cents per share. For fiscal years 2011 and 2012, the Zacks Consensus Estimates are, respectively, $3.36 per share and $3.51 per share.

The quantitative Zacks #2 Rank (short-term Buy rating) for the company indicates upward pressure on the shares over the near term.

Based in Decatur, Illinois, Archer Daniels Midland Company procures, transports, stores, processes and merchandises agricultural commodities and products in the United States and internationally.  In the United States, Archer Daniels operates 191 elevators with an aggregate storage capacity of more than 420 million bushels. It competes with Bunge Ltd (BG) and Corn Products International Inc. (CPO).

 
ARCHER DANIELS (ADM): Free Stock Analysis Report
 
BUNGE LTD (BG): Free Stock Analysis Report
 
CORN PROD INTL (CPO): Free Stock Analysis Report
 
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