Archer-Daniels-Midland, a major global grain trader, exceeded market estimates for first-quarter profit in 2024 as lower energy and production costs led to a 15-cent per share increase in segment operating profit from a year earlier, according to ESMagazine.

The results were stronger than anticipated by Wall Street analysts, largely due to robust performance in ADM's corporate segments and other areas, said Stephens analysts in a note.

"Overall, these results are fairly in line with where we believe investor expectations are, as the market seeks more visibility on the rest of the year," Stephens analysts wrote.

Profit Pressure

ADM and its trading and processing rivals Bunge and Cargill Inc have seen profit pressures as global crop deliveries rise and prices fall from recent historic highs.

Agribusinesses make money by processing, trading, and transporting crops globally. Intense competition in South America has affected demand for U.S. crop exports, putting pressure on ADM, which holds the bulk of its grain assets there.

Oil and gas prices have fallen compared to peaks reached in 2022 following Russia's invasion of Ukraine, benefiting ADM.

Adjusted operating profit in ADM's grain and oilseed services division, which includes soybean crushing and trading businesses, fell to $864 million from $1.21 billion a year earlier.

Carbohydrate Solutions, a division housing ADM's ethanol and sweeteners operations, saw adjusted operating profit decline to $248 million from $279 million a year earlier.

Nutrition Division

Billed by executives as ADM's future, the Nutrition division saw explosive growth until profits began to erode in late 2022.

On Tuesday, the Nutrition unit reported adjusted operating profit of $84 million, down from $138 million in the year-earlier period.

The decline, the company said, was partially due to a stable market for texturizers that affected the unit's margins, as well as unplanned downtime at its Decatur East facility, where an explosion occurred in September.

The Chicago-based company reported adjusted earnings of $1.46 per share for the three months ended March 31, compared with analysts' average estimate of $1.36 per share.