Archer-Daniels-Midland cut its 2025 profit forecast for a third straight quarter on Tuesday as U.S. biofuel policy uncertainty and global trade disruptions pressured oilseed crush margins, sending its shares down eight per cent in pre-market trading.
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.
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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.
