ADM to double spending on ethanol/biodiesel plants
ADM CEO: Ethanol Demand May Top Mandates
biz.yahoo.com
Tuesday June 13, 11:59 am ET
Archer Daniels Midland CEO: U.S. Ethanol Demand May Top Mandates
CHICAGO (AP) -- Archer Daniels Midland Co. will double its capital spending to between $3.5 billion and $4 billion over the next few years on investments in new ethanol and biodiesel plants, as well as other projects, which will be profitable even if oil drops below the current $70 or so per barrel, said President and Chief Executive Patricia A. Woertz.
Speaking Tuesday at a Deutsche Bank conference in Paris, which was Webcast, she said profits from the renewable fuel plants "will be quite robust at something less than that."
Although government goals ensure increased ethanol production over the next several years, Woertz is optimistic that "ethanol demand in the U.S. will go beyond what is mandated by the current set of laws."
She said the investments in adding new ethanol production include new rail cars, barges and tractor trailers to create a transport infrastructure for the ethanol it produces. Woertz said the investments also allow the company to market ethanol for other producers.
ADM is the largest producer of ethanol, with a 25 percent market share, she said. "There are a number of new competitors" in the market, according to Woertz. ADM's advantage is "around experience, network capabilities and cost advantages."
She also said she saw little chance the United States would drop its current 54-cent-a-gallon tariff on imported ethanol, noting it was one of the few issues that had bipartisan support in a divided Congress. "Both parties are aligned to support renewable fuels development in the U.S.," Woertz said. "There is not much will to remove tariffs."
ADM is based in Decatur, Ill. It's one of the world's largest agricultural processors, making vegetable oil, syrup and flour. |
