World Grain - August 2016 - 28

FEATURE: LUCIANO TAKING ADM FORWARD CONFIDENTLY IN GRAIN

tent to "set the competitive standard by
industry," including grain, basic processing and ingredients.
Asked how the company has progressed toward this objective, Luciano
offered a deeper explanation of the prin-

with transportation in the middle," he
said. "What I don't like in a corporation
is when there is a piece that subsidizes
another piece. That's a big risk for investors and shareholders - that the
managers can decide that their favorite

"Yes, we understand that we are in a volatile industry. It
isn't a problem. Our company does volatility very well."
- Juan Luciano, ADM CEO
ciple and examples of how pursuit of
the goal is playing out in the company's
global grain business. A risk in large
corporations, Luciano said, is the tendency for one major business to mask
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"We have three major businesses -
the grain business, the processing and
the ingredient business, give or take,

pet project will be subsidized. There's
no defense for the shareholder on that.
"So I always feel very strongly that
each of these businesses, although I
make sure that there are strong synergies
for us, needs to stand on its own feet. So,
I want my grain business to be the best
grain business out there. And to be competing with people that are only in grain.

And, I want my processing business to
do the same and I want my ingredient
business to do the same."
To maximize value ADM derives from
its grain unit, the company has looked
to gaps in its business. Already strong in
grain origination, Luciano spoke earlier
this year about opportunities in "destination marketing," noting at the time only
about 15% of the company's grain volume
UHDFKHVWKH¿QDOFXVWRPHUVD\LQ%UD]LORU
(J\SW 7KLV ¿QDO VWHS UHSUHVHQWV DQ RSportunity to widen margins, and ADM has
crafted a plan to increase the percentage to
30% or even 40%.
In December, the company acquired
a 50% stake in Cairo-based Medsofts
Group, a joint venture that includes a local
grain distribution operation serving customers in Egypt, an inland logistics network linking port operations to customers throughout Egypt and an international

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For more information, see Page 106.

August 2016 / World

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World Grain - August 2016

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