Archer Daniels Midland Company (ADM), the agricultural processor company, recently reported first-quarter 2010, topping the Zacks Consensus Estimate on the heels of lower corn costs.

The quarterly earnings of 77 cents a share surpassed the Zacks Consensus Estimate of 56 cents but fell 52% year-on-year from $1.62 in earnings delivered in the prior-year quarter, as the ethanol business has been grappling with a slump in demand for corn-based fuel, a gasoline substitute. With oil prices hovering around $77, the production of ethanol is losing its feasibility.

Total revenue tumbled 29% to $14,921 million due to a decline in average selling prices and, to some extent, currency fluctuations. Total segment operating profit plunged 34% to $774 million.

Due to the slump in demand, the Oilseeds Processing segment’s revenue fell 18% to $6,358 million, and operating profit plunged 44% to $284 million due to a fall in margins and lower production volumes.

Corn Processing’s operating profit jumped 59% to $188 million due to lower corn and manufacturing costs. However, revenue for the division declined 15% to $1,916 million.

The Agricultural Services unit’s revenue dropped 44% to $5,322 million. The segment operating profit also declined 59% to $175 million due to a slump in demand for agricultural commodities amid the prolonged recession.

Despite the economic turmoil, Archer Daniels continues with its major projects — a co-generation plant in Clinton, Iowa; beginning operations at its new cocoa processing facility in Kumasi, Ghana; starting production at its first sugarcane ethanol plant in Brazil and at its new Columbus, Nebraska ethanol plant. The company also acquired an oilseed processing plant in Olomouc, Czech Republic.

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