Archer Daniels sees bumper crops driving profits

|About: Archer Daniels Midland Co. (ADM)|By:, SA News Editor

Archer Daniels Midland (ADM +3.7%) powers higher after reporting better than expected Q2 earnings, citing strong U.S. exports and demand for ethanol.

ADM President Juan Luciano said on today's earnings conference call that a second straight year of bumper U.S. crops will boost ADM's grain-trading profits by driving greater volumes through its trade and transportation network.

ADM already is benefiting from rising U.S. grain and oilseed output, with crop-trading income rising about eightfold in Q2 to $115M, as ramped-up exports improved profits over drought-crimped results a year earlier.

Luciano also expects strong harvests in North America and Europe to help lift quarterly profits in ADM's agricultural services unit to the high end of the division's historical range of $200M-$250M.

Also, ADM says it expects to have a signed agreement to sell its global chocolate business by the end of Q3.