Illinois-based Archer Daniels Midland Company (ADM - Free Report) recently announced that it has been certified officially to tie up with Wilmar International Limited. These two companies have entered the partnership in global fertilizers, European vegetable oil as well as global ocean freight.
The new partnership will be based in Rolle, Switzerland. The companies will team up to purchase and distribute global fertilizers as well as enhance the operation and supervision of their oceangoing fleets by providing two ships (one from each company) as an initial effort. Additionally, these two companies will come together for sales and marketing of vegetable oils and fats in Europe.
Currently, Archer Daniels Midland holds 16% ownership in Wilmar. Management at Archer Daniels Midland believes that the new partnership will extend the company’s international footprint and will enable them to provide better services to their customers.
Archer Daniels Midland and Wilmar share a healthy supplier relationship since mid-1990s. The two companies started their partnership with a network of soybean processing operations in China.
Archer Daniels Midland procures, transports, stores, processes, and merchandises agricultural commodities and products in the United States and internationally. The company has three major business segments: Oilseeds Processing, Corn Processing, and Agricultural Services. Currently, Archer Daniels Midland has 30,000 workers around the world and runs around 270 processing plants and provides 420 crop procurement facilities. The company’s prime competitors include Cargill Inc., Bunge Ltd. (BG - Free Report) , Tyson Foods Inc. (TSN - Free Report) and Corn Products International Inc.
We maintain our long-term ‘Underperform’ recommendation on the stock based on the disappointing fourth quarter results of fiscal 2012.