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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Jon Matz who wrote (43347)	3/16/2000 3:01:00 PM
From: Tunica Albuginea	Respond to of 99985

To: Jon Matz who wrote (43347)	3/16/2000 3:04:00 PM
From: Joan Osland Graffius	Respond to of 99985

Jon, >>Don't those companies that bring an increased priced product to market have to shave their profit margins to keep the demand up or to keep their market share? ADM and Cargill work off of margins. They raise prices to cover their costs and the higher the prices of the commodity it will give them an increase in earnings. Both ADM and Cargill just took some bean crushing plants off line to increase margins and then with the price of grains/beans going up we should see a more than expected effect at the bottom line. This of course assumes grain prices continue their climb. ADM and Cargill in reality do not have any competition to speak of, and cost of entry into this market is prohibitive. Both of these companies will not let profits get out of hand so anyone can enter. This is why it has been easy for them to fix prices.<g> I do not expect to see any more price fixing until the next generation of management. This generation has learned there lesson. Joan