Its shares were down 4.25 per cent in premarket trading.

Chicago-based ADM reported its weakest fourth-quarter adjusted profit since 2019 as slumping soybean processing margins in North and South America and poor U.S. soybean exports dented earnings for its Agricultural Services and Oilseeds business, its largest segment.

Low prices erode profits

A global grains glut that has dragged down prices of staple crops like corn and soybeans to near multi-year lows has eroded profits for ADM and agribusiness peers like Bunge and Cargill. U.S. biofuel policy delays and trade turmoil stemming from U.S. President Donald Trump’s tariff wars created further pressure on the global grains merchants.

The downbeat outlook comes as the U.S. Securities and Exchange Commission and the Justice Department concluded investigations into whether ADM had inflated the performance of a key business segment. ADM agreed to pay a $40 million civil penalty to settle SEC charges while the DOJ closed its criminal investigation, drawing a line under a years-long scandal that forced the company to twice revise its financial reports.

ADM reported adjusted earnings of 87 cents per share for the quarter ended December 31, down from $1.14 a share a year earlier but above the consensus analyst estimate of 80 cents, according to data compiled by LSEG.

CEO Juan Luciano said operating profit for 2025 was affected by a turbulent global trade landscape and ongoing uncertainty around U.S. biofuel policy. Resolutions “should support a more constructive operating environment for us in 2026,” he added.

Biofuel policy delay creates caution

The U.S. government has been slow to finalize some biofuels policies, a delay that has slowed use of feedstocks like the soybean oil produced at ADM processing plants.

ADM reported adjusted earnings for 2025 of $3.43 per share. Its 2026 adjusted earnings outlook of $3.60 to $4.25 per share hinged on those biofuel policies and whether slumping soy processing margins improve. The midpoint is less than analysts’ average estimate of $4.24 apiece, according to data compiled by LSEG.

Last month, Reuters reported that the Trump administration plans to finalize long-delayed 2026 biofuel blending quotas by early March, keeping them close to its initial proposal while dropping a plan to penalize imports of renewable fuels and feedstocks.

The delays have led biofuel makers and the suppliers of feedstocks like ADM to hold back on deals and delay spending decisions that shape output and margins.

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ADM reached the settlement without admitting or denying any wrongdoing, and said the Justice Department, which had been conducting its own probe, has closed its investigation without bringing criminal charges.

The agreement draws a line under a years-long scandal that forced the company, one of the world’s largest agricultural traders and processors, to twice revise its financial reports, and sparked heavy share losses and shareholder lawsuits.

WHY IT MATTERS: ADM is one of the world’s largest agricultural traders and processors.

The SEC on Tuesday separately sued ADM’s former Chief Financial Officer Vikram Luthar for his role in the allegedly fraudulent adjustments and filed settled charges against two other top executives.

The SEC settlement includes charges brought against former Nutrition business unit President Vince Macciocchi and Ray Young, who was ADM’s CFO until 2022. Macciocchi has agreed to pay more than $529,000 in fines and other fees, while Young will pay more than $650,000.

The SEC complaint against Luthar, filed in the U.S. District Court for the Northern District of Illinois, accuses him of breaking federal securities laws by helping ADM mislead investors and by failing to properly report and account for the company’s activities.

Regulators allege he played a role in fraudulent conduct, helped ADM violate rules and benefitted from the fraud. The SEC is seeking to bar Luthar from serving as an officer or director of a public company, and force him to pay a penalty and other fees.

Luthar’s attorney Junaid Zubairi called the allegations “meritless” and said ADM’s own investigation found that Luthar had not acted improperly.

A lawyer for ADM declined to comment further. A lawyer for Macciocchi also declined to comment and a lawyer for Young did not respond immediately to a request for comment.

The U.S. Attorney’s Office in Manhattan did not immediately respond to requests for comment on the closing of the criminal case.

In a statement on the company’s website, CEO Juan Luciano said the company is pleased to put the matter behind them and has taken “extensive actions” to enhance internal controls.

ADM shares were near unchanged in after-hours trading on Tuesday.

Probe centred on nutrition unit

Federal prosecutors opened a probe in early 2024 into accounting issues at ADM tied to the performance of its highly touted “Nutrition” unit, Reuters previously reported. The government investigations as well as an internal inquiry led to the exit of Luthar.

The ADM investigation involved internal company transactions that inaccurately reported financial results for the “Nutrition” unit, which was launched in 2018 to accelerate development of high-value specialty ingredients for the food, beverage and animal feed industries.

ADM cut a combined $228 million from Nutrition’s operating profit between 2018 and 2023 as a result of the revisions, company filings show.

News of the accounting irregularities broke in early 2024, sending ADM shares plummeting and heaping pressure on top executives, including Luciano, as top executive compensation had been tied to growth in the Nutrition unit.

The investigation into “intersegment” transactions between the company’s business segments focused on whether ADM deliberately boosted Nutrition’s performance by providing it with below-cost goods from other company units.

The SEC considered ADM’s cooperation in accepting the settlement offer, the regulator said in a statement.

Specifically, the company conducted an internal investigation, voluntarily reported its findings to agency staff, and provided the staff with additional analyses from an outside accounting expert.

ADM’s remedial measures included implementing new internal accounting controls around intersegment transactions, amending its policies and procedures, and testing the effectiveness of its new controls, among other things, the SEC said.

— Additional reporting by Jonathan Stempel and Jasper Ward in Washington and P.J. Huffstutter in Chicago

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The firms exiting the so-called Amazon Soy Moratorium, which has saved millions of acres of tropical forest over nearly two decades, are looking to shield themselves from a new state law in Mato Grosso, the sources said on condition of anonymity.

Starting in January, the state will strip tax incentives from companies taking part in the conservation program. Mato Grosso grew some 51 million metric tons of soybeans in 2025, more than Argentina.

A preliminary report from state auditors in April found that grains traders had benefited from tax incentives worth about 4.7 billion reais (C$1.15 billion) between 2019 and 2024.

ADM and Bunge were the top beneficiaries of tax incentives, receiving about 1.5 billion reais (C$368.6 million) each, said Sergio Ricardo, head of the Mato Grosso state audit court.

U.S.-based ADM, Bunge and Cargill, as well as China’s Cofco and Brazil’s Amaggi, are signatories of the pact with facilities in Mato Grosso that have benefited from state tax incentives. It was not clear which of the firms would break immediately from the moratorium.

Cargill referred questions to industry group Abiove, which did not respond to requests for comment. ADM, Bunge, Cofco, Amaggi and grain exporter group Anec did not respond to questions.

“Most companies will choose not to lose the tax incentives and will withdraw from the agreement,” said one of the sources, adding that the departures would effectively end a pact signed in 2006 with the federal government and conservation groups.

‘Dangerous precedent’

The moratorium is considered one of the most important forces slowing deforestation rates in the Brazilian Amazon over the past two decades as it bars signatories from buying soybeans from farmers who plant on land deforested after July 2008.

Researchers estimate that an area of the rainforest the size of Ireland would have been lost to soy farms in Brazil without the moratorium and related conservation efforts, compared to the pace of expansion in neighboring countries such as Bolivia.

The Mato Grosso law, which lawmakers passed in 2023, is the latest example of a global retreat from pacts and policies to curb climate change, even as temperatures break records, driven by rising fossil fuel use and deforestation.

Critics of the soy moratorium say that the pact restricts the market and hurts farmers. Farming groups in Mato Grosso say the protocol reduces the income and economic development of the state.

“Companies could choose to keep their zero-deforestation commitments,” said Cristiane Mazzetti, who oversees the moratorium for Greenpeace. “It’s a dangerous precedent, and it’s not what we need in a moment of climate emergency,” she added.

Brazil’s federal government has argued in court against the new Mato Grosso law stripping tax breaks from traders due to their environmental commitments.

“If the Mato Grosso government really removes those incentives, we have heard that some, or many, companies will in fact abandon the moratorium for economic reasons,” said Andre Lima, a senior Environment Ministry official tasked with combating deforestation. He added that firms had not officially informed the ministry of their plans.

Far-reaching consequences

President Luiz Inacio Lula da Silva has vowed an “ecological transformation” of the Brazilian economy, capped off with the United Nations climate summit hosted in the Amazon last month.

But in domestic politics, his leftist government is often fighting a rearguard battle to protect the world’s largest rainforest from a farm lobby with the upper hand in Congress.

The unraveling of the Amazon Soy Moratorium is likely to embolden those rural powerbrokers and their allies. This year the farm lobby has successfully gutted environmental permitting laws and stripped some protections from Indigenous lands.

The trend has caught the attention of farmer groups in Europe arguing to block a free trade agreement between the European Union and South America’s Mercosur due to the impact of Brazilian agribusiness on vital ecosystems.

Brazil’s Supreme Court has barred some but not all of the farm lobby’s agenda in Congress, based on constitutional protections for the environment and Indigenous peoples.

Environmentalists warn that the end of the soy moratorium could pave the way to dismantle other environmental protections in the world’s largest soybean producer, including part of Brazil’s forestry code restricting farmers from felling trees on 80 per cent of their properties in the Amazon.

Lawsuits

In recent years, soybean farmers pushed state lawmakers in Mato Grosso, Rondonia and Maranhao to strip tax benefits from companies taking part in environmental pacts more restrictive than Brazilian law.

It remains unclear which environmental commitments outside the soy moratorium will trigger those new state laws, which could threaten a range of other companies, including cellulose producers and meatpackers.

Brazilian antitrust agency CADE has separately opened an investigation of the soy moratorium for a potential breach of competition rules. For nearly two decades, trading firms have shared the cost of monitoring soy farms in the Amazon to avoid buying from those planting on newly deforested land.

Starting in January, CADE has ordered traders “to refrain from collecting, storing, sharing, or disseminating commercial information related to the sale, production, or acquisition of soybeans.”

Soy farmers in Mato Grosso have also sued grain traders for roughly $180 million over their role in the pact.

In temporary rulings, Supreme Court Justice Flavio Dino stopped the antitrust investigation, but let the Mato Grosso law take effect. Environmental groups are still trying to block the state law ahead of a final court ruling on the issue.

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ADM and its agribusiness peers have seen earnings erode in recent quarters due to ample global crop supplies and commodities market upheaval that has thinned margins.

U.S. President Donald Trump’s tariff threats and shifting deadlines for duties have created further difficulties for global grains merchants like ADM, including halting Chinese purchases of U.S. soybeans and other farm goods that drove crop prices to multi-year lows.

The deferral of U.S. biofuel policy decisions, particularly regarding renewable fuel blending requirements under the U.S. Renewable Fuel Standard, slowed use of feedstocks like the soybean oil produced at ADM processing plants.

ADM sees earnings rebound in 2026

Profit in ADM’s agricultural services and oilseed segment, its largest division, fell 21 per cent in the third quarter to $379 million (C$533.6 million). Crushing business earnings tumbled 93 per cent in the quarter.

ADM said it expected adjusted earnings of $3.25 to $3.50 per share (C$4.58 to $4.93) for 2025, down from its previous forecast of around $4.00 and below analysts’ estimate of $3.79 per share.

However, the company forecast an earnings rebound in 2026 on Trump administration proposals for increased biofuel use and a cooling of trade tensions with China.

Trump and Chinese President Xi Jinping last week agreed to cut back certain tariffs and other trade hurdles, and China vowed to resume U.S. soybean purchases after shunning them for months.

“We expect biofuel policy clarity and trade policy evolution to provide demand signals for our industry,” CEO Juan Luciano said.

In a research note, UBS analysts said: “We continue to believe 2026 is setting up very well for ADM, with higher RVO (biofuel mandates) driving incremental demand for soybean oil.”

ADM reported an adjusted profit of 92 cents per share for the three months ended September 30, a six-year low for the quarter but topping analysts’ average estimate of 85 cents, according to data compiled by LSEG.

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Alltech, the U.S.-based firm that has wholly owned Masterfeeds since 2015, announced Tuesday it will merge Masterfeeds’ 15 Canadian feed mills into a new North American animal feed business that also includes Alltech’s Hubbard Feeds and its 18 U.S. mills, plus ADM’s 11 U.S. mills.

“We’re evolving with purpose to offer an industry-leading range of products and solutions for livestock, equine, backyard and leisure animals,” Alltech and ADM said in a joint statement Tuesday.

The two companies expect to close the deal and formally launch the as-yet-unnamed joint venture sometime in the first quarter of the new year. No financial details were released Tuesday.

Alltech will be the majority owner of the new firm, which they said will be “governed by a board with equal representation from each parent company.”

The deal will not include any of ADM’s Canadian locations, nor its U.S. premix and additive businesses. The Reuters news service reported Tuesday the deal will also not include ADM’s mills in Mexico.

Nor will the deal include Alltech’s Ridley block and feed ingredient businesses or specialty ingredients business. All those business units, however, are expected to serve as suppliers to the joint venture.

Masterfeeds began in 1929 as Master Feeds, the commercial feed division of Toronto Elevators Ltd., which merged into Maple Leaf Mills in 1961. U.S. ag co-operative Ag Processing Inc. (AGP) took over Masterfeeds in a joint venture with ADM in 1991, then bought full control in 2001.

Alltech became a minority partner in Masterfeeds in 2015 when it bought control of feed firm Ridley Inc., then bought full control of Masterfeeds later that year.

Masterfeeds, headquartered at London, Ont., with a regional office in Winnipeg, also holds feed analysis firm Stratford Agri Analysis and the feed and tack retail chain Cowtown, which has four stores in Saskatchewan and one at Brandon, Man. Alltech hasn’t yet said whether those businesses go into the new joint venture.

The companies also didn’t say Tuesday whether the combination will involve any job cuts or site closures, but said the new j.v. “will offer an opportunity to align their complementary North American feed strengths, including the expertise of their teams, extensive manufacturing capabilities, deep experience in nutrition science, and well-recognized and respected existing product portfolios.”

The new business, they said, “is going to be able to offer even more: broader capabilities, more products, and new innovative solutions, all delivered with the relationships and service our customers have come to expect.”

Reuters, in its report Tuesday, noted ADM has been in cost-cutting mode since early this year and its nutrition business has fallen short of revenue targets.

“ADM has historically grown its animal feed business through acquisition, but the returns have not worked out so far,” Morningstar analyst Seth Goldstein told Reuters. “It makes sense for ADM to look for these kind of partnerships that could add value to its business.”

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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.

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.

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Why it matters: Declines in soybean markets can influence what Canadian farmers are paid for oilseeds, including canola.

Processors such as Chicago-based ADM have been waiting for the U.S. Environmental Protection Agency’s decision on blending requirements for months as they grapple with slumping crush margins and abundant soybean stocks.

Reuters reported on Thursday that the EPA is expected to propose blending requirements below industry recommendations on Friday, leading to lower-than-expected demand for soyoil to be used in biofuels.

However, the U.S. Environmental Protection Agency proposed on Friday total biofuel blending volumes at 24.02 billion gallons in 2026 and 24.46 billion gallons in 2027. That compares with blending requirements of 22.33 billion gallons in 2025.

ADM said in an emailed statement to Reuters on Thursday that it does not have insight around the pending blending announcement beyond publicly available information and that it independently sets its basis bids, which is the difference between futures and a local cash price to take possession of the grain immediately.

The company on Wednesday rolled its cash basis bid at its flagship Decatur, Illinois, facility to 20 cents below the Chicago Board of Trade November soybean futures price SX25 from 22 cents over July futures SN25.

The roll to November futures, which closed at a 15-cent discount to July on Thursday, lowered the local cash price by about 60 cents a bushel, representing an unusually sharp 6.5 per cent drop in the price offered to farmers.

ADM also rolled basis bids at its other crushing facilities, and some rival processors, including Cargill, followed ADM on Thursday. Other processors kept their basis bids against the July futures contract, but lowered basis values by up to 15 cents.

“ADM Decatur put the bean market in a frenzy,” agriculture trading company John Stewart and Associates said in a note.

Falling basis values reflect expectations for a large autumn harvest and weak demand that has eroded processing margins for companies that crush beans into soymeal livestock feed and soyoil used for cooking and producing biofuels.

Crush margins have struggled as a recent jump in U.S. processing capacity has swelled available supplies of meal and oil and pressured prices for the soy products.

Tariff worries and unclear U.S. biofuels policies have stoked further unease among crushers and biofuel makers, and some biodiesel producers have scaled back or idled plants.

ADM said in April it would permanently close a South Carolina soybean processing plant to cut costs.

“Cash crush margins stink, and there is a bunch of downtime scheduled for July,” said Charlie Sernatinger, executive vice president for Marex Capital Markets.

Diana Klemme, vice president of Grain Service Corp in Atlanta, which serves agricultural hedgers in the futures markets, sent an alert to customers after seeing ADM’s bid adjustments.

She said that she had never seen a move to new-crop basis levels in June in more than 50 years in the grain business.

“I said check your markets carefully because ADM just dropped all their bids 40-75 cents a bushel and went to new-crop values,” Klemme said. The November futures contract represents the autumn harvest price, or the new crop.

Farmers have been reluctant to sell crops to processors because they want higher prices, while processors avoided raising bids to protect their thin margins.

— Additional reporting by Julie Ingwersen

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Why it matters: Archer-Daniels-Midland, a major buyer of Canadian agricultural goods, is cutting costs globally.

ADM has been cutting jobs and downsizing some operations since it announced in February that it planned to cut costs by $500 million to $700 million (C$692.5 million to $969.4 million) over three to five years.

“After exploring a wide variety of alternatives, we’ve determined that our Kershaw crush plant no longer aligns with our future operational needs,” ADM spokesperson Dane Lisser said.

The company, still reeling from an accounting scandal last year that sent its stock price tumbling, is now facing stiff headwinds amid rising trade tensions between the United States and key markets including top soybean importer China.

The Kershaw plant will be the first U.S. soybean processing plant to close following a multi-year, industry-wide expansion amid soaring vegetable oil demand from biofuels makers, according to industry sources.

But the biofuel sector has more recently been throttling back production due to U.S. biofuels policy uncertainty and the potential for a worsening trade war.

The Kershaw plant is the smallest of more than a dozen dedicated soy processing facilities operated by ADM in the United States, with the capacity to crush 50,000 bushels a day, according to industry sources.

ADM said it will help Kershaw employees find new jobs and provide financial severance for those that elect to leave the company, but did not disclose the number of workers impacted.

The Kershaw plant employed between 11 and 50 workers, according to South Carolina Department of Commerce data.

Earlier this month, ADM announced it was shutting down domestic trading operations in China, also as part of its global cost-cutting push.

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The move was meant to help ADM, a grains trading giant that has been embroiled in an accounting scandal since last year, “remain agile in a challenging environment,” the company said in the statement. ADM’s earnings have eroded due to slumping crop prices, inflation-reduced consumer demand and weak crop processing margins, with operating profit down 40 per cent last year in its large Agricultural Services and Oilseeds (AS&O) division.

Rising trade tensions between Washington and Beijing are now stirring up new headwinds for ADM, which relies on trade between top farm goods exporter the United States and China, the top importer.

The phase-out of domestic trading at ADM’s Toepfer Shanghai subsidiary was expected to conclude by the end of September, ADM said, adding that its other operations in Shanghai would not be affected.

The company did not disclose the number of layoffs, but a source familiar with the matter said job cuts would impact 40 to 50 employees, leaving only around 10 staff in the financial hub of Shanghai.

“The entire Ag Services and Oilseeds team in China has essentially been let go,” said one source, referring to ADM’s largest business segment.

ADM began layoffs in February as part of a broader cost-cutting drive to save $500 million to $700 million (C$694.4 to $972.2 million) over the next three to five years. The company had posted its weakest fourth-quarter adjusted profit in six years.

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Cuddy will continue in his current role as global president of carbohydrate solutions, according to the memo.

ADM did not have an immediate comment on the organizational change.

Juan Luciano, ADM’s chief executive officer, said in the memo that “given the dynamic geopolitical environment, we believe that adapting our current geographical alignment will enhance ADM’s ability to drive our strategy forward.”

Luciano added the position of president for North America is a new role that was created “to support the unique needs of our business across the U.S., Canada, Mexico and the Caribbean.”

— Reporting by Ana Mano in Sao Paulo and Chris Prentice in New York

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