Leading agri-business Archer Daniels Midland (ADM) has announced it will boost its North American oilseed crushing operations on the back of an increased global demand for food and biodiesel.
The firm yesterday said its capacity increases in the US and Canada will result from the expansion of five soybean crushing plants and two canola crushing plants.
"Expanding our crush capacity will enable us to meet the increased demands for vegetable oil and oilseed proteins, driven by the world's growing need for energy and food," said stated Scott Fredericksen, president of ADM's North American Oilseed Processing business.
ADM said that factors driving the increased demand for oilseed crushing include a growing population that increases the demand for food worldwide, rising global wealth that is changing protein and oils consumption, and increasing global energy needs and energy security concerns that promote biodiesel demand.
The soybean crushing plants set for expansion are in Quincy, Illinois; Frankfort, Indiana; Mexico, Missouri; Fremont, Nebraska and Des Moines, Iowa.
The firm's two canola crushing plants due to be expanded are in Velva, North Dakota and Lloydminster, Alberta, Canada.
The changes, which are scheduled to be completed in mid-2008, will be dependent on final engineering and permit approval, said ADM.
The expansions are expected to support the company's two North American biodiesel facilities in Mexico, Missouri and Velva, North Dakota.
Earlier this month, ADM revealed a first quarter increase in profits from its oilseed processing segment of $71m to $170m, on the back of "improved market conditions".
Overall earnings for the quarter ended September 30 2006 more than doubled to reach $403m, a massive 116 percent increase from last year's figure of $186m.
Net sales for the period stood at $9.4bn, a 10 percent increase from last year's figure of $8.6bn.
"ADM delivered near-record performance in the first quarter. Our earnings (…) reflect strong momentum in our core businesses," had said ADM chief executive officer and president, Patricia Woertz, but she added that the firm will continue to experience challenges in dealing with volatile commodity prices.