UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 10-Q


x	~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, ~~2017~~2022


o	~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number 1-44

ARCHER-DANIELS-MIDLAND COMPANY

(Exact name of registrant as specified in its charter)



Delaware			41-0129150
(State or other jurisdiction of incorporation or organization)			(I. R. S. Employer Identification No.)

77 West Wacker Drive, Suite 4600
Chicago,	Illinois		60601
(Address of principal executive offices)		~~60601~~	(Zip Code)

(~~312) 634-8100~~
~~(Registrant’s telephone number, including area code)~~

(312) 634-8100

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	ADM	NYSE
1.000% Notes due 2025		NYSE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x☒ No ¨☐.

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes x☒ No ¨☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large ~~accelerated filer~~ x

Accelerated Filer

☒

Accelerated ~~filer~~ oFiler

☐

Emerging Growth Company

☐

Non-accelerated ~~filer~~ o

Filer

☐

Smaller ~~reporting company~~ o

Reporting Company

~~Emerging growth company~~ o

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o☐ No x☒.

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, no par value – ~~559,250,312~~549,334,227 shares

(October ~~30, 2017)~~24, 2022)

SAFE HARBOR STATEMENT

This Quarterly Report on Form 10-Q contains forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995 that is subject to risks and uncertainties that could cause actual results to differ materially from those projected, expressed, or implied by such forward-looking information. Risks and uncertainties that could cause or contribute to such differences include, but are not limited to, those discussed in Item 1A, “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2021, as may be updated in our subsequent Quarterly Reports on Form 10-Q. To the extent permitted under applicable law, Archer-Daniels-Midland Company assumes no obligation to update any forward-looking statements as a result of new information or future events.

PART I - FINANCIAL INFORMATION


~~ITEM 1.~~	~~FINANCIAL STATEMENTS~~

ITEM 1. FINANCIAL STATEMENTS

Archer-Daniels-Midland Company

Consolidated Statements of Earnings

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In millions, except per share amounts)

Revenues	$	24,683	$	20,340	$	75,617	$	62,159
Cost of products sold	22,872		19,014		69,809		57,822
Gross Profit	1,811		1,326		5,808		4,337

Selling, general, and administrative expenses	818		720		2,461		2,208
Asset impairment, exit, and restructuring costs	28		2		30		84
Equity in earnings of unconsolidated affiliates	(210)		(110)		(606)		(398)
Interest and investment income	(85)		(20)		(176)		(83)
Interest expense	97		61		262		188
Other (income) expense – net	(67)		20		(183)		36
Earnings Before Income Taxes	1,230		653		4,020		2,302

Income tax expense	193		120		679		364
Net Earnings Including Noncontrolling Interests	1,037		533		3,341		1,938

Less: Net earnings attributable to noncontrolling interests	6		7		20		11

Net Earnings Attributable to Controlling Interests	$	1,031	$	526	$	3,321	$	1,927

Average number of shares outstanding – basic	561		564		565		564

Average number of shares outstanding – diluted	563		566		566		566

Basic earnings per common share	$	1.84	$	0.93	$	5.88	$	3.42

Diluted earnings per common share	$	1.83	$	0.93	$	5.87	$	3.41

Dividends per common share	$	0.40	$	0.37	$	1.20	$	1.11

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
(In millions, except per share amounts)

Revenues $ 14,827
$ 15,832
$ 44,758
$ 45,845
Cost of products sold 14,015
14,742
42,191
43,237
Gross Profit 812
1,090
2,567
2,608

Selling, general, and administrative expenses 478
546
1,530
1,525
Asset impairment, exit, and restructuring costs 107
11
140
36
Interest expense 79
78
246
213
Equity in (earnings) losses of unconsolidated affiliates (46 ) 2
(327 ) (153 )
Interest income (27 ) (23 ) (75 ) (68 )
Other (income) expense – net (4 ) (4 ) (13 ) (138 )
Earnings Before Income Taxes 225
480
1,066
1,193

Income taxes 30
136
256
331
Net Earnings Including Noncontrolling Interests 195
344
810
862

Less: Net earnings attributable to noncontrolling interests 3
3
3
7

Net Earnings Attributable to Controlling Interests $ 192
$ 341
$ 807
$ 855

Average number of shares outstanding – basic 566
586
571
591

Average number of shares outstanding – diluted 569
589
574
593

Basic earnings per common share $ 0.34
$ 0.58
$ 1.41
$ 1.45

Diluted earnings per common share $ 0.34
$ 0.58
$ 1.41
$ 1.44

Dividends per common share $ 0.32
$ 0.30
$ 0.96
$ 0.90

See notes to consolidated financial statements.

Archer-Daniels-Midland Company

Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In millions)

Net earnings including noncontrolling interests	$	1,037	$	533	$	3,341	$	1,938
Other comprehensive income (loss):
Foreign currency translation adjustment	(221)		(24)		(79)		305
Tax effect	(74)		(30)		(189)		(78)
Net of tax amount	(295)		(54)		(268)		227

Pension and other postretirement benefit liabilities adjustment	8		13		45		102
Tax effect	(2)		5		(13)		(22)
Net of tax amount	6		18		32		80

Deferred gain (loss) on hedging activities	43		75		245		258
Tax effect	(5)		(1)		(50)		(41)
Net of tax amount	38		74		195		217

Unrealized gain (loss) on investments	—		6		(13)		4
Tax effect	1		—		2		(1)
Net of tax amount	1		6		(11)		3
Other comprehensive income (loss)	(250)		44		(52)		527
Comprehensive income (loss)	787		577		3,289		2,465

Less: Comprehensive income (loss) attributable to noncontrolling interests	3		6		8		10

Comprehensive income (loss) attributable to controlling interests	$	784	$	571	$	3,281	$	2,455

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
(In millions)

Net earnings including noncontrolling interests $ 195
$ 344
$ 810
$ 862
Other comprehensive income (loss):
Foreign currency translation adjustment 245
(41 ) 628
(57 )
Tax effect (40 ) 5
(4 ) 18
Net of tax amount 205
(36 ) 624
(39 )

Pension and other postretirement benefit liabilities adjustment 174
11
193
27
Tax effect (66 ) (4 ) (74 ) (7 )
Net of tax amount 108
7
119
20

Deferred gain (loss) on hedging activities (26 ) 1
12
(10 )
Tax effect 6
3
1
3
Net of tax amount (20 ) 4
13
(7 )

Unrealized gain (loss) on investments 6
(28 ) 1
(16 )
Tax effect —
1
—
(2 )
Net of tax amount 6
(27 ) 1
(18 )
Other comprehensive income (loss) 299
(52 ) 757
(44 )
Comprehensive income (loss) including noncontrolling interests 494
292
1,567
818

Less: Comprehensive income (loss) attributable to noncontrolling interests 4
3
5
7

Comprehensive income (loss) attributable to controlling interests $ 490
$ 289
$ 1,562
$ 811

See notes to consolidated financial statements.

Archer-Daniels-Midland Company

Consolidated Balance Sheets

(In millions) September 30, 2017 December 31, 2016
(Unaudited)
Assets
Current Assets
Cash and cash equivalents $ 518
$ 619
Short-term marketable securities 261
296
Segregated cash and investments 5,040
5,011
Trade receivables 1,911
1,905
Inventories 8,326
8,831
Other current assets 3,084
4,383
Total Current Assets 19,140
21,045

Investments and Other Assets

Investments in and advances to affiliates 4,972
4,497
Long-term marketable securities 207
187
Goodwill and other intangible assets 3,939
3,703
Other assets 755
579
Total Investments and Other Assets 9,873
8,966

Property, Plant, and Equipment

Land 467
445
Buildings 4,974
4,679
Machinery and equipment 17,858
17,160
Construction in progress 1,166
1,213
24,465
23,497
Accumulated depreciation (14,509 ) (13,739 )
Net Property, Plant, and Equipment 9,956
9,758
Total Assets $ 38,969
$ 39,769

Liabilities, Temporary Equity, and Shareholders’ Equity

Current Liabilities

Short-term debt $ 728
$ 154
Trade payables 3,449
3,606
Payables to brokerage customers 5,135
5,158
Accrued expenses and other payables 2,548
3,982
Current maturities of long-term debt 13
273
Total Current Liabilities 11,873
13,173

Long-Term Liabilities

Long-term debt 6,595
6,504
Deferred income taxes 1,754
1,669
Other 1,117
1,218
Total Long-Term Liabilities 9,466
9,391

Temporary Equity - Redeemable noncontrolling interest 53
24

Shareholders’ Equity

Common stock 2,390
2,327
Reinvested earnings 17,023
17,444
Accumulated other comprehensive income (loss) (1,843 ) (2,598 )
Noncontrolling interests 7
8
Total Shareholders’ Equity 17,577
17,181
Total Liabilities, Temporary Equity, and Shareholders’ Equity $ 38,969
$ 39,769


(In millions)	September 30, 2022		December 31, 2021
	(Unaudited)
Assets
Current Assets
Cash and cash equivalents	$	1,099	$	943

Segregated cash and investments	9,345		8,016
Trade receivables - net	4,679		3,311
Inventories	13,282		14,481

Other current assets	6,164		5,158
Total Current Assets	34,569		31,909

Investments and Other Assets
Investments in affiliates	5,429		5,285

Goodwill and other intangible assets	6,364		6,747
Right of use assets	983		1,023
Other assets	1,354		1,369
Total Investments and Other Assets	14,130		14,424

Property, Plant, and Equipment
Land and land improvements	500		554
Buildings	5,532		5,597
Machinery and equipment	18,941		19,112
Construction in progress	1,221		960
	26,194		26,223
Accumulated depreciation	(16,589)		(16,420)
Net Property, Plant, and Equipment	9,605		9,803

Total Assets	$	58,304	$	56,136

Liabilities, Temporary Equity, and Shareholders’ Equity
Current Liabilities
Short-term debt	$	181	$	958
Trade payables	6,543		6,388
Payables to brokerage customers	10,359		8,965
Accrued expenses and other payables	4,686		4,790
Current lease liabilities	279		277
Current maturities of long-term debt	888		570

Total Current Liabilities	22,936		21,948

Long-Term Liabilities
Long-term debt	7,671		8,011
Deferred income taxes	1,639		1,412
Non-current lease liabilities	723		765
Other	1,016		1,233
Total Long-Term Liabilities	11,049		11,421

Temporary Equity - Redeemable noncontrolling interest	290		259

Shareholders’ Equity
Common stock	3,110		2,994
Reinvested earnings	23,099		21,655
Accumulated other comprehensive income (loss)	(2,212)		(2,172)
Noncontrolling interests	32		31
Total Shareholders’ Equity	24,029		22,508
Total Liabilities, Temporary Equity, and Shareholders’ Equity	$	58,304	$	56,136

See notes to consolidated financial statements.

Archer-Daniels-Midland Company

Consolidated Statements of Cash Flows

(Unaudited)


(In millions)	Nine Months Ended September 30,
	2022		2021


Operating Activities
Net earnings including noncontrolling interests	$	3,341	$	1,938
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities
Depreciation and amortization	774		739
Asset impairment charges	20		54
Deferred income taxes	(39)		(95)
Equity in earnings of affiliates, net of dividends	(279)		(36)
Stock compensation expense	123		135

Loss on debt extinguishment	—		36
Deferred cash flow hedges	245		258
Gains on sales of assets and businesses/investment revaluation	(77)		(95)
Other – net	549		156
Changes in operating assets and liabilities, net of acquisitions and dispositions
Segregated investments	(1,452)		594
Trade receivables	(1,613)		(1,060)
Inventories	590		405

Other current assets	(929)		1,187
Trade payables	305		170
Payables to brokerage customers	1,706		2,236
Accrued expenses and other payables	84		(769)
Total Operating Activities	3,348		5,853

Investing Activities
Capital expenditures	(841)		(714)
Net assets of businesses acquired	—		(501)
Proceeds from sales of assets and businesses	51		73


Investments in affiliates	(60)		(7)



Other – net	(98)		(138)
Total Investing Activities	(948)		(1,287)

Financing Activities
Long-term debt borrowings	752		1,330
Long-term debt payments	(482)		(533)
Net borrowings (payments) under lines of credit agreements	(751)		(1,726)

Share repurchases	(1,200)		—
Cash dividends	(677)		(626)

Other – net	(6)		1
Total Financing Activities	(2,364)		(1,554)

Increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents	36		3,012
Cash, cash equivalents, restricted cash, and restricted cash equivalents - beginning of period	7,454		4,646

Cash, cash equivalents, restricted cash, and restricted cash equivalents - end of period	$	7,490	$	7,658

Reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents to the consolidated balance sheets

Cash and cash equivalents	$	1,099	$	1,083
Restricted cash and restricted cash equivalents included in segregated cash and investments	6,391		6,575
Total cash, cash equivalents, restricted cash, and restricted cash equivalents	$	7,490	$	7,658

(In millions) Nine Months Ended
September 30,
2017 2016
Operating Activities
Net earnings including noncontrolling interests $ 810
$ 862
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities

Depreciation and amortization 684
678
Asset impairment charges 81
28
Deferred income taxes (27 ) 36
Equity in earnings of affiliates, net of dividends (131 ) 25
Stock compensation expense 63
58
Deferred cash flow hedges 12
(10 )
Gains on sales of assets and businesses/revaluation (66 ) (117 )
Other – net 174
1
Changes in operating assets and liabilities

Segregated investments 268
46
Trade receivables 106
(463 )
Inventories 703
1,053
Other current assets 1,317
(415 )
Trade payables (259 ) (554 )
Payables to brokerage customers (94 ) 355
Accrued expenses and other payables (1,486 ) (287 )
Total Operating Activities 2,155
1,296

Investing Activities

Purchases of property, plant, and equipment (696 ) (621 )
Proceeds from sales of business and assets 172
104
Net assets of businesses acquired (187 ) (136 )
Purchases of marketable securities (499 ) (1,127 )
Proceeds from sales of marketable securities 572
1,162
Investments in and advances to affiliates (281 ) (628 )
Other – net (14 ) 15
Total Investing Activities (933 ) (1,231 )

Financing Activities

Long-term debt borrowings 509
1,036
Long-term debt payments (840 ) (9 )
Net borrowings (payments) under lines of credit agreements 558
107
Share repurchases (676 ) (754 )
Cash dividends (544 ) (528 )
Other – net 4
14
Total Financing Activities (989 ) (134 )

Increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents 233
(69 )
Cash, cash equivalents, restricted cash, and restricted cash equivalents - beginning of period 1,561
1,796
Cash, cash equivalents, restricted cash, and restricted cash equivalents - end of period $ 1,794
$ 1,727

Reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents to the consolidated balance sheets

Cash and cash equivalents $ 518
$ 701
Restricted cash and restricted cash equivalents included in segregated cash and investments 1,276
1,026
Total cash, cash equivalents, restricted cash, and restricted cash equivalents $ 1,794
$ 1,727

See notes to consolidated financial statements.

Archer-Daniels-Midland-Company

Consolidated ~~Statement~~Statements of Shareholders’ Equity

(Unaudited)

Common Stock
Reinvested
Earnings

Accumulated
Other
Comprehensive
Income (Loss)

Noncontrolling
Interests

Total
Shareholders’
Equity
Shares Amount
(In millions)

Balance, December 31, 2016 573
$ 2,327
$ 17,444
$ (2,598 ) $ 8
$ 17,181
Impact of ASU 2016-16 (see Note 2) (7 ) (7 )
Balance, January 1, 2017 573
$ 2,327
$ 17,437
$ (2,598 ) $ 8
$ 17,174
Comprehensive income

Net earnings
807

3

   Other comprehensive
     income (loss)

755
2

      Total comprehensive
       income

1,567
Cash dividends paid- $0.96 per share

(544 )

(544 )
Share repurchases (16 ) (676 ) (676 )
Stock compensation expense 1
63

63
Other 1
—
(1 ) —
(6 ) (7 )
Balance, September 30, 2017 559
$ 2,390
$ 17,023
$ (1,843 ) $ 7
$ 17,577


	Common Stock			Reinvested Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests		Total Shareholders’ Equity
(In millions, except per share amounts)	Shares	Amount
Balance, June 30, 2022	561	$	3,066	$	23,292	$	(1,965)	$	33	$	24,426
Comprehensive income
Net earnings				1,031				6
Other comprehensive income (loss)						(247)		(3)
Total comprehensive income										787
Cash dividends paid - $0.40 per share				(224)						(224)
Share repurchases	(12)			(1,000)						(1,000)
Stock compensation expense	—	26								26
Stock option exercises net of taxes	—	17								17
Other	—	1		—		—		(4)		(3)
Balance, September 30, 2022	549	$	3,110	$	23,099	$	(2,212)	$	32	$	24,029

Balance, December 31, 2021	560	$	2,994	$	21,655	$	(2,172)	$	31	$	22,508
Comprehensive income
Net earnings				3,321				20
Other comprehensive income (loss)						(40)		(12)
Total comprehensive income										3,289
Cash dividends paid - $1.20 per share				(677)						(677)
Share repurchases	(14)			(1,200)						(1,200)
Stock compensation expense	3	123								123
Stock option exercises net of taxes	—	(9)								(9)

Other	—	2		—		—		(7)		(5)
Balance, September 30, 2022	549	$	3,110	$	23,099	$	(2,212)	$	32	$	24,029


Balance, June 30, 2021	559	$	2,941	$	20,762	$	(2,121)	$	21	$	21,603


Comprehensive income
Net earnings				526				7
Other comprehensive income (loss)						45		(1)
Total comprehensive income										577
Cash dividends paid - $0.37 per share				(209)						(209)

Stock compensation expense	—	21								21
Stock option exercises net of taxes	—	1								1
Other	—	1		2		—		(6)		(3)
Balance, September 30, 2021	559	$	2,964	$	21,081	$	(2,076)	$	21	$	21,990

Balance, December 31, 2020	556	$	2,824	$	19,780	$	(2,604)	$	22	$	20,022


Comprehensive income
Net earnings				1,927				11
Other comprehensive income (loss)						528		(1)
Total comprehensive income										2,465
Cash dividends paid - $1.11 per share				(626)						(626)

Stock compensation expense	3	135								135

Other	—	5		—		—		(11)		(6)
Balance, September 30, 2021	559	$	2,964	$	21,081	$	(2,076)	$	21	$	21,990

See notes to consolidated financial statements.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements

(Unaudited)


~~Note 1.~~	Note 1. Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these statements do not include all of the information and footnotes required by ~~generally accepted accounting principles~~GAAP for audited financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the ~~quarter and~~ nine months ended September 30, ~~2017~~2022 are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2017~~.2022. For further information, refer to the consolidated financial statements and notes thereto included in the ~~Company’s~~ Annual Report on Form 10-K for the year ended December 31, ~~2016~~2021 for Archer-Daniels-Midland Company (the Company or ADM).

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated. The Company consolidates all entities, including variable interest entities (VIEs), in which it has a controlling financial interest. For VIEs, the Company assesses whether it is the primary beneficiary as defined under the applicable accounting standard. Investments in affiliates, including VIEs through which the Company exercises significant influence but does not control the investee and is not the primary beneficiary of the investee’s activities, are carried at cost plus equity in undistributed earnings since acquisition and are adjusted, where appropriate, for basis differences between the investment balance and the underlying net assets of the investee. The Company’s portion of the results of certain affiliates and results of certain VIEs are included using the most recent available financial statements. In each case, the financial statements are within 93 days of the Company’s year end and are consistent from period to period.

~~Retirement Benefit Changes~~

On July 31, 2017, the Company announced that all participants in the Company’s U.S. salaried pension plan and the Supplemental Executive Retirement Plan (SERP) will begin accruing benefits under the cash balance formula effective January 1, 2022. Benefits for participants who were accruing under the final average pay formula will be frozen as of December 31, 2021, including pay and service through that date.

This change, along with other changes in participation associated with divestitures and restructuring, triggered a remeasurement of the salaried pension plan and the SERP resulting in decreases in the fiscal 2017 pension expense, accumulated other comprehensive loss, and underfunded status by $18 million, $182 million, and $164 million, respectively.

Concurrent with this change, the Company also changed the method used to estimate the service and interest cost components of the net periodic pension and postretirement benefit costs for its U.S. plans. The new method uses the spot rate yield curve approach to estimate the service and interest costs. Previously, those costs were determined using a single weighted-average discount rate applied to all future cash outflows. The change does not affect the measurement of the Company’s benefit obligations and was accounted for as a change in accounting estimate in accordance with the guidance of ASC Topic 250, ~~Accounting Estimates and Error Corrections, thereby impacting the current and future quarters. The impact of this change on after-tax earnings and diluted earnings per share for the quarter ended September 30, 2017 was immaterial.~~

~~Reclassifications~~

The Company classified $17 million and $49 million of fees from its U.S. futures commission brokerage business in cost of products sold in the quarter and nine months ended September 30, 2017, respectively. Prior period amounts of $15 million and $50 million in the quarter and nine months ended September 30, 2016, respectively, have been reclassified from selling, general, and administrative expenses in the consolidated statement of earnings to conform to the current presentation.

~~In the quarter ended June 30, 2017, the Company began presenting certain specified items separately from the individual business segments, as further described in Note 14.~~

A~~rcher-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 1.~~	~~Basis of Presentation (Continued)~~

In line with the futures brokerage industry practice, the Company has correctly classified $1.2 billion of segregated cash and cash equivalents as restricted cash and cash equivalents in the statement of cash flows effective September 30, 2017. Prior period amounts have been restated to conform to the current presentation which resulted in an increase of $145 million in total cash provided by operating activities for the nine months ended September 30, 2016 and an increase of $938 million in the ending balance of cash, cash equivalents, restricted cash, and restricted cash equivalents as of September 30, 2016.

Segregated Cash and Investments

The Company segregates certain cash, cash ~~equivalent,~~equivalents, and investment balances in accordance with regulatory requirements, commodity exchange requirements, and insurance arrangements. These balances represent deposits received from customers of the Company’s registered futures commission merchant and commodity brokerage services, cash margins and securities pledged to commodity exchange clearinghouses, and cash pledged as security under certain insurance arrangements. Segregated cash and investments also include restricted cash collateral for the various insurance programs of the Company’s captive insurance business. To the degree these segregated balances are comprised of cash and cash equivalents, they are considered restricted cash and cash equivalents on the ~~statement~~consolidated statements of cash flows.

~~Last-in, First-out (LIFO) Inventories~~Receivables

Interim period LIFO calculations are based on interim period costs and management’s estimates of year-end inventory levels. Because the availability and price of agricultural commodity-based LIFO inventories are unpredictable due to factors such as weather, government farm programs and policies, and changes in global demand, quantities of LIFO-based inventoriesThe Company records receivables at ~~interim periods may vary significantly from management’s estimates of year-end inventory levels.~~


~~Note 2.~~	~~New Accounting Standards~~

~~Effective January 1, 2017, the Company adopted the amended guidance of ASC Topic 330,~~ ~~Inventory, which simplifies the measurement of inventory. The amended guidance requires an entity to measure its cost-based inventory at the lower of cost or~~ net realizable value ~~where net realizable value is~~in trade receivables, other current assets, and other assets. These amounts included allowances for estimated uncollectible accounts totaling $179 million and $122 million at September 30, 2022 and December 31, 2021, respectively, to reflect any loss anticipated on the ~~estimated~~accounts receivable balances including any accrued interest receivables thereon. Long-term receivables recorded in other assets were not material to the Company’s overall receivables portfolio.

The Company recorded bad debt expense in selling, ~~price~~general, and administrative expenses of $29 million and $73 million in the ~~ordinary course of business, less reasonably predictable costs of completion, disposal,~~three and ~~transportation.~~

~~Effective January 1, 2017, the Company adopted the amended guidance of ASC Topic 323,~~ ~~Investments - Equity Method~~nine months ended September 30, 2022, respectively, and ~~Joint Ventures, which simplifies the transition to the equity method of accounting. The amended guidance eliminates the requirement of an investor to adjust the investment, results of operations,~~$1 million and ~~retained earnings retroactively when an investment qualifies for equity method accounting as a result of an increase~~$9 million in the ~~level~~three and nine months ended September 30, 2021, respectively.

Cost Method Investments

Cost method investments of ~~ownership interest or degree~~$465 million and $297 million as of ~~influence. The amendments require the investor add the cost of acquiring the additional interest~~September 30, 2022 and December 31, 2021, respectively, were included in Other Assets in the ~~investee to the current basis~~Company’s consolidated balance sheets. Revaluation gains of the investors’ previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. The adoption of this amended guidance did not have an impact on the Company’s financial results.

~~Effective January 1, 2017, the Company adopted the amended guidance of ASC Topic 810,~~ ~~Consolidatio~~n, which affects reporting entities that are required to evaluate whether they should consolidate a variable interest entity in certain situations involving entities under common control. The amended guidance changes the evaluation of whether a reporting entity is the primary beneficiary of a variable interest entity by changing how a reporting entity that is a single decision maker of a variable interest entity treats indirect interests$37 million in the entity held through related parties that are under common control with the reporting entity. The Company was required to adopt the amended guidance using a retrospective transition approach to all periods presented. The adoption of this amended guidance did not resultnine months ended September 30, 2022, and $9 million and $49 million in the ~~deconsolidation or consolidation~~three and nine months ended September 30, 2021, respectively, in connection with observable third-party transactions, were recorded in investment income in the Company's consolidated statements of ~~any of its variable interest entities.~~earnings. There were no revaluation gains recorded in the three months ended September 30, 2022.

~~Effective January 1, 2017, the Company adopted the amended guidance of ASC Topic 740,~~ ~~Income Taxes~~, which requires entities to recognize the income tax consequences of an intra-entity transfer, other than inventory, when the transfer occurs. Under the previous accounting rules, entities were prohibited from recognizing current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. The amended guidance does not change the accounting for the pre-tax effects of an intra-entity asset transfer or for an intra-entity transfer of inventory. The Company adopted the amended guidance on a modified retrospective approach basis through a $7 million cumulative effect adjustment to retained earnings as of January 1, 2017.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 1. Basis of Presentation (Continued)

Operations in Ukraine and Russia

ADM employs approximately 650 people in Ukraine and operates an oilseeds crushing plant, a grain port terminal, inland and river silos, and a trading office. Most of the facilities have been temporarily idled since February 24, 2022, some of which were brought back online during the quarter ended September 30, 2022, due in part to the opening of the Black Sea grain export corridor. The Company’s footprint in Russia is limited and operations have been scaled down to those related to the production and transport of essential food commodities and ingredients.

As a result of the ongoing conflict in Ukraine, the Company reviewed the valuation of its assets and recorded immaterial charges in the three and nine months ended September 30, 2022 related to receivables and inventories. As of September 30, 2022, ADM concluded that 1) receivables, net of allowances, are deemed collectible; and 2) market inventories are valued appropriately. The temporarily idled property, plant, and equipment, which is immaterial, are not considered impaired. The Company also evaluated the impact of Russia’s recent announcement of its purported annexation of four Ukrainian regions on the valuation of ADM’s assets in those regions and concluded that the assets are appropriately valued. As the conflict in Ukraine evolves, the Company will continue to review the valuation of these assets and make any required adjustments, which are not expected to be material to the Company’s consolidated financial statements.


~~Note 3.~~	Note 2. Pending Accounting Standards

Through December 31, 2022, the Company has the option to adopt the amended guidance of Accounting Standards Codification (ASC) Topic 848, Reference Rate Reform, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The expedients and exceptions provided by the amended guidance do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022, except for hedging relationships existing as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The Company plans to adopt the expedients and exceptions provided by the amended guidance before the December 31, 2022 expiry date and does not expect the adoption of the amended guidance to have an impact on its consolidated financial statements.

Effective January 1, ~~2018,~~2023, the Company will be required to adopt the amended guidance of ASC ~~Subtopic 825-10,~~ ~~Financial Instruments - Overall~~Topic 805, Business Combinations, which ~~is intended to improve~~improves comparability for both the recognition and measurement of ~~financial instruments.~~acquired revenue contracts with customers at the date of and after a business combination. The amended guidance requires an entity (acquirer) to recognize and measure ~~equity investments, except those accounted for under the equity method of accounting or those that result~~contract assets and contract liabilities acquired in ~~consolidation of the investee, at fair value~~a business combination in accordance with changes in fair value recognized in net income and simplify the impairment assessment of equity investments without readily determinable fair values by using a qualitative assessment to identify impairment.ASC Topic 606, Revenue from Contracts with Customers,(Topic 606). Early adoption is permitted. The Company does not expect the adoption of this amended guidance to have a significant impact on ~~the Company’s~~its consolidated financial ~~results.~~statements.

Effective January 1, ~~2018, the Company will be required to adopt the new guidance of ASC Topic 606,~~ ~~Revenue from Contracts with Customers~~ ~~(Topic 606), which will supersede the revenue recognition requirements in ASC Topic 605,~~ ~~Revenue Recognition~~. Topic 606 requires the Company to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance requires the Company to apply the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the Company satisfies a performance obligation. The Company will adopt Topic 606 on a modified retrospective basis and will be required to provide additional disclosures of the amount by which each financial statement line item is affected in the current reporting period, as compared to the guidance that was in effect before the change, and an explanation of the reasons for significant changes. The adoption of this new guidance will require expanded disclosures in the Company’s consolidated financial statements including separate quantitative disclosure of revenues within the scope of Topic 606 and revenues excluded from the scope of Topic 606. Many of the Company’s sales contracts are considered derivatives under ASC Topic 815, ~~Derivatives and Hedging~~, and are therefore excluded from the scope of Topic 606. The Company has established a cross-functional implementation team consisting of representatives from all of its business segments. The Company utilized surveys to validate all of its current revenue recognition streams and identify areas of its business where potential differences could result from applying the requirements of the new standard. The Company also conducted workshops and performed contract reviews to gather more information about the nature, magnitude, and frequency of the underlying transactions that drove the survey responses. Based on the surveys, workshops, and contract reviews, the Company identified potential accounting changes in the areas of control transfer, voyage charter revenue, bill and hold arrangements, and variable consideration. In the fourth quarter of 2017, the Company will complete the final phase of its revenue recognition implementation plan which includes quantification of the areas of accounting change, assessment of the financial impact of the new guidance on its consolidated financial statements, and finalization of its revenue recognition accounting policy and position papers.

~~Effective January 1, 2018,~~2023, the Company will be required to adopt the amended guidance of ASC ~~Topic 805,~~ ~~Business Combinations~~Subtopic 405-50, Liabilities - Supplier Finance Programs,which ~~clarifies~~enhances the ~~definition~~transparency of ~~a business.~~supplier finance programs. The amended guidance ~~is intended~~requires an entity (buyer) in a supplier finance program to ~~help companies~~disclose sufficient information about the program to allow a user of financial statements to understand the program’s nature, activity during the period, changes from period to period, and other organizations evaluate whether transactions should be accounted for as acquisitions (disposals) of assets or businesses and provides a more robust framework to use in determining when a set of assets and activities is a business.potential magnitude. Early adoption is permitted for transactions that have not been reported in financial statements that have been issued or made available for issuance. No disclosures are required at adoption. The Company plans to adopt the amended guidance on October 1, 2017.

~~Effective January 1, 2018, the Company will be required to adopt the amended guidance of ASC Topic 715,~~ ~~Compensation - Retirement Benefits~~, which requires that an employer report the service cost component in the same line or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations, if one is presented.permitted. The adoption of this amended guidance will require expanded disclosures and the reclassification of the other components of net benefit cost from cost of products sold and selling, general, and administrative expenses to other (income) expense - net in the Company’s consolidated statements of earnings but will not impact financial results.

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 3.~~	~~Pending Accounting Standards (Continued)~~

~~Effective January 1, 2018,~~ the Company ~~will be required~~ to ~~adopt the amended guidance of ASC Topic 718,~~ ~~Compensation - Stock Compensation~~ (Topic 718), which provides clarity and reduces diversity in practice as well as cost and complexity when applying the guidance in Topic 718 to the modification of the terms and conditions of a share-based payment. The amendments include guidance on determining which changes to the terms and conditions of share-based payment awards require an entity to apply modification accounting. Early adoptionprovide disclosures about its supplier finance programs, if material, but is ~~permitted, including in any interim period for which financial statements have~~ not ~~yet been issued. The Company plans to adopt the amended guidance on October 1, 2017 and does not expect the adoption of this amended guidance~~expected to have ~~a significant~~an impact on ~~the Company’s financial results.~~

~~Effective January 1, 2019, the Company will be required to adopt the new guidance of ASC Topic 842,~~ ~~Leases~~ ~~(Topic 842), which will supersede ASC Topic 840,~~ ~~Leases~~. Topic 842 requires lessees to recognize assets and liabilities for all leases with lease terms of more than 12 months. The Company expects to adopt Topic 842 using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The adoption of this new guidance will require expanded disclosures in the Company’sits consolidated financial statements. The Company has established a cross-functional implementation team consisting of representatives from accounting, legal, procurement, and operations. The Company utilized surveys to centrally gather more information about its existing leases and lease processes and to gather lease contracts. To ensure completeness of the population of lease contracts, the results of the survey were cross-referenced against other available lease information (i.e., year-end disclosures and general ledger). The Company is also working with a vendor to implement a lease management system which will assist in delivering the required accounting changes and disclosures. The next phase of the implementation plan is the abstraction of the relevant lease contract data points which is expected to be completed in the first quarter of 2018. The impact of the new standard will be a significant increase to right of use assets and lease liabilities on the Company’s consolidated balance sheet, primarily as a result of operating leases currently not recognized on the balance sheet. The Company has not yet completed its assessment of the impact of the new guidance on its consolidated statement of earnings.

~~Effective January 1, 2019, the Company will be required to adopt the amended guidance of ASC Topic 815,~~ ~~Derivatives and Hedging~~, which expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amended guidance also simplifies the application of hedge accounting guidance and eases the administrative burden of hedge documentation requirements and assessing hedge effectiveness. Early adoption is permitted in any interim period with the effect of adoption reflected as an adjustment to the opening balance of retained earnings as of the beginning of the fiscal year of adoption. The Company is considering adopting the amended guidance on January 1, 2018 but has not yet completed its assessment of the impact of this amended guidance on the Company’s financial results.

~~Effective January 1, 2020, the Company will be required to adopt the amended guidance of ASC Topic 326,~~ ~~Financial Instruments - Credit Losses~~, which is intended to improve financial reporting by requiring more timely recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The amended guidance requires the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Early adoption will be permitted for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company does not expect the adoption of this amended guidance to have a significant impact on the Company’s financial results.

~~Effective January 1, 2020, the Company will be required to adopt the amended guidance of ASC Topic 350,~~ ~~Goodwill and Other~~, which simplifies the subsequent measurement of goodwill. The amended guidance removes the second step of the goodwill impairment test and requires the application of a one-step quantitative test where the amount of goodwill impairment is the excess of a reporting unit's carrying amount over its fair value, but not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company plans to adopt the amended guidance on October 1, 2017 and does not expect the adoption of this amended guidance to have a significant impact on the Company’s financial results.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 4.~~	~~Acquisitions~~

~~During~~

Note 3. Revenues

Revenue Recognition

The Company principally generates revenue from merchandising and transporting agricultural commodities, and manufacturing products for use in food, beverages, feed, energy, and industrial applications, and ingredients and solutions for human and animal nutrition. Revenue is measured based on the consideration specified in the contract with a customer. The Company follows a policy of recognizing revenue at a single point in time when it satisfies its performance obligation by transferring control over a product or service to a customer. The majority of the Company’s contracts with customers have one performance obligation and a contract duration of one year or less. The Company applies the practical expedient in paragraph 10-50-14 of Topic 606 and does not disclose information about remaining performance obligations that have original expected durations of one year or less. For transportation service contracts, the Company recognizes revenue over time as the mode of transportation moves towards its destination in accordance with the transfer of control guidance of Topic 606. The Company recognized revenue from transportation service contracts of $227 million and $611 million for the three and nine months ended September 30, ~~2017,~~2022, respectively, and $153 million and $408 million for the three and nine months ended September 30, 2021, respectively. For physically settled derivative sales contracts that are outside the scope of Topic 606, the Company ~~acquired Crosswind Industries, Inc., Chamtor SA,~~recognizes revenue when control of the inventory is transferred within the meaning of Topic 606 as required by ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets (Topic 610-20).

Shipping and Handling Costs

Shipping and handling costs related to contracts with customers for the sale of goods are accounted for as a ~~51% controlling interest~~fulfillment activity and are included in ~~Industries Centers,~~cost of products sold. Accordingly, amounts billed to customers for such costs are included as a component of revenues.

Taxes Collected from Customers and ~~an 89% controlling interest~~Remitted to Governmental Authorities

The Company does not include taxes assessed by governmental authorities that are (i) imposed on and concurrent with a specific revenue-producing transaction and (ii) collected from customers, in ~~Biopolis SL.~~ the measurement of transaction prices or as a component of revenues and cost of products sold.

Contract Liabilities

Contract liabilities relate to advance payments from customers for goods and services that the Company has yet to provide. Contract liabilities of $423 million and $581 million as of September 30, 2022 and December 31, 2021, respectively, were recorded in accrued expenses and other payables in the consolidated balance sheets. Contract liabilities recognized as revenues were $111 million and $581 million for the three and nine months ended September 30, 2022, respectively, and $128 million and $697 million for the three and nine months ended September 30, 2021, respectively.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 3. Revenues (Continued)

Disaggregation of Revenues

The ~~aggregate cash purchase~~following tables present revenue disaggregated by timing of recognition and major product lines for the three and nine months ended September 30, 2022 and 2021.


	Three Months Ended September 30, 2022
	Topic 606 Revenue						Topic 815(1)		Total
	Point in Time		Over Time		Total		Revenue		Revenues
	(In millions)









Ag Services and Oilseeds
Ag Services	$	1,095	$	227	$	1,322	$	11,215	$	12,537
Crushing	202		—		202		3,018		3,220
Refined Products and Other	715		—		715		2,669		3,384
Total Ag Services and Oilseeds	2,012		227		2,239		16,902		19,141
Carbohydrate Solutions
Starches and Sweeteners	1,994		—		1,994		686		2,680
Vantage Corn Processors	901		—		901		—		901
Total Carbohydrate Solutions	2,895		—		2,895		686		3,581
Nutrition
Human Nutrition	906		—		906		—		906
Animal Nutrition	958		—		958		—		958
Total Nutrition	1,864		—		1,864		—		1,864

Other Business	97		—		97		—		97
Total Revenues	$	6,868	$	227	$	7,095	$	17,588	$	24,683

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 3. Revenues (Continued)


	Nine Months Ended September 30, 2022
	Topic 606 Revenue						Topic 815(1)		Total
	Point in Time		Over Time		Total		Revenue		Revenues
	(In millions)
Ag Services and Oilseeds
Ag Services	$	3,078	$	611	$	3,689	$	35,028	$	38,717
Crushing	455		—		455		9,349		9,804
Refined Products and Other	2,091		—		2,091		8,211		10,302
Total Ag Services and Oilseeds	5,624		611		6,235		52,588		58,823
Carbohydrate Solutions
Starches and Sweeteners	5,813		—		5,813		1,884		7,697
Vantage Corn Processors	3,001		—		3,001		—		3,001
Total Carbohydrate Solutions	8,814		—		8,814		1,884		10,698
Nutrition
Human Nutrition	2,884		—		2,884		—		2,884
Animal Nutrition	2,907		—		2,907		—		2,907
Total Nutrition	5,791		—		5,791		—		5,791

Other Business	305		—		305		—		305
Total Revenues	$	20,534	$	611	$	21,145	$	54,472	$	75,617


	Three Months Ended September 30, 2021
	Topic 606 Revenue						Topic 815(1)		Total
	Point in Time		Over Time		Total		Revenue		Revenues
	(In millions)









Ag Services and Oilseeds
Ag Services	$	616	$	153	$	769	$	9,130	$	9,899
Crushing	119		—		119		2,723		2,842
Refined Products and Other	657		—		657		2,291		2,948
Total Ag Services and Oilseeds	1,392		153		1,545		14,144		15,689
Carbohydrate Solutions
Starches and Sweeteners	1,516		—		1,516		456		1,972
Vantage Corn Processors	894		—		894		—		894
Total Carbohydrate Solutions	2,410		—		2,410		456		2,866
Nutrition
Human Nutrition	808		—		808		—		808
Animal Nutrition	889		—		889		—		889
Total Nutrition	1,697		—		1,697		—		1,697

Other Business	88		—		88		—		88
Total Revenues	$	5,587	$	153	$	5,740	$	14,600	$	20,340

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 3. Revenues (Continued)


	Nine Months Ended September 30, 2021
	Topic 606 Revenue						Topic 815(1)		Total
	Point in Time		Over Time		Total		Revenue		Revenues
	(In millions)
Ag Services and Oilseeds
Ag Services	$	2,080	$	408	$	2,488	$	30,372	$	32,860
Crushing	335		—		335		8,076		8,411
Refined Products and Other	1,828		—		1,828		5,868		7,696
Total Ag Services and Oilseeds	4,243		408		4,651		44,316		48,967
Carbohydrate Solutions
Starches and Sweeteners	4,326		—		4,326		1,237		5,563
Vantage Corn Processors	2,346		—		2,346		—		2,346
Total Carbohydrate Solutions	6,672		—		6,672		1,237		7,909
Nutrition
Human Nutrition	2,410		—		2,410		—		2,410
Animal Nutrition	2,583		—		2,583		—		2,583
Total Nutrition	4,993		—		4,993		—		4,993

Other Business	290		—		290		—		290
Total Revenues	$	16,198	$	408	$	16,606	$	45,553	$	62,159

(1) Topic 815 revenue relates to the physical delivery or the settlement of the Company’s sales contracts that are accounted for as derivatives and are outside the scope of Topic 606.

Ag Services and Oilseeds

The Ag Services and Oilseeds segment generates revenue from the sale of commodities, from service fees for the transportation of goods, from the sale of products manufactured in its global processing facilities, and from its structured trade finance activities. Revenue is measured based on the consideration specified in the contract. Revenue is recognized when a performance obligation is satisfied by transferring control over a product or providing service to a customer. For transportation service contracts, the Company recognizes revenue over time as the mode of transportation moves towards its destination in accordance with the transfer of control guidance of Topic 606. The amount of revenue recognized follows the contractually specified price, which may include freight or other contractually specified cost components. For physically settled derivative sales contracts that are outside the scope of Topic 606, the Company recognizes revenue when control of the inventory is transferred within the meaning of Topic 606 as required by Topic 610-20.

Carbohydrate Solutions

The Carbohydrate Solutions segment generates revenue from the sale of products manufactured at the Company’s global corn and wheat milling facilities around the world. Revenue is recognized when control over products is transferred to the customer. Products are shipped to customers from the Company’s various facilities and from its network of storage terminals. The amount of revenue recognized is based on the consideration specified in the contract, which could include freight and other costs depending on the specific shipping terms of each contract. For physically settled derivative sales contracts that are outside the scope of Topic 606, the Company recognizes revenue when control of the inventory is transferred within the meaning of Topic 606 as required by Topic 610-20.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 3. Revenues (Continued)

Nutrition

The Nutrition segment sells ingredients and solutions including plant-based proteins, natural flavors, flavor systems, natural colors, emulsifiers, soluble fiber, polyols, hydrocolloids, probiotics, prebiotics, enzymes, botanical extracts, edible beans, formula feeds, animal health and nutrition products, pet food and treats, and other specialty food and feed ingredients. Revenue is recognized when control over products is transferred to the customer. The amount of revenue recognized follows the contracted price or the mutually agreed price of ~~these acquisitions~~the product. Freight and shipping are recognized as a component of ~~$187 million, net~~revenue at the same time control transfers to the customer.

Other Business

Other Business includes the Company’s futures commission business whose primary sources of ~~cash acquired~~revenue are commissions and brokerage income generated from executing orders and clearing futures contracts and options on futures contracts on behalf of ~~$7 million, was preliminarily allocated as follows:~~its customers. Commissions and brokerage revenue are recognized on the date the transaction is executed. Other Business also includes the Company’s captive insurance business, which generates third party revenue through its proportionate share of premiums from third-party reinsurance pools. Reinsurance premiums are recognized on a straight-line basis over the period underlying the policy.

(In millions)
Working capital $ 16
Property, plant, and equipment 111
Goodwill 34
Other intangible assets 50
Other long-term assets 6
Long-term liabilities (19 )
Noncontrolling interest (11 )
Aggregate cash purchase price, net of cash acquired $ 187


~~Note 5.~~	Note 4. Fair Value Measurements

The following tables set forth, by level, the Company’s assets and liabilities that were accounted for at fair value on a recurring basis as of September 30, ~~2017~~2022 and December 31, ~~2016~~.2021.


	Fair Value Measurements at September 30, 2022
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(In millions)

Assets:
Inventories carried at market	$	—	$	4,539	$	3,086	$	7,625
Unrealized derivative gains:
Commodity contracts	—		757		702		1,459
Foreign currency contracts	—		751		—		751
Interest rate contracts	—		105		—		105

Cash equivalents	436		—		—		436

Segregated investments	1,332		—		—		1,332

Total Assets	$	1,768	$	6,152	$	3,788	$	11,708

Liabilities:
Unrealized derivative losses:
Commodity contracts	$	—	$	681	$	709	$	1,390
Foreign currency contracts	—		337		—		337

Debt conversion option	—		—		3		3
Inventory-related payables	—		902		220		1,122

Total Liabilities	$	—	$	1,920	$	932	$	2,852

Fair Value Measurements at September 30, 2017

Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)

Significant
Other
Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)
Total
(In millions)

Assets:
Inventories carried at market $ —
$ 3,361
$ 1,094
$ 4,455
Unrealized derivative gains:
Commodity contracts —
240
120
360
Foreign currency contracts —
81
—
81
Interest rate contracts —
2
—
2
Cash equivalents 49
—
—
49
Marketable securities 376
92
—
468
Segregated investments 1,827
—
—
1,827
Deferred receivables consideration —
399
—
399
Total Assets $ 2,252
$ 4,175
$ 1,214
$ 7,641

Liabilities:
Unrealized derivative losses:
Commodity contracts $ —
$ 300
$ 145
$ 445
Foreign currency contracts —
119
—
119
Inventory-related payables —
493
20
513
Total Liabilities $ —
$ 912
$ 165
$ 1,077

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 5.~~	Note 4. Fair Value Measurements (Continued)


	Fair Value Measurements at December 31, 2016									Fair Value Measurements at December 31, 2021
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(In millions)									(In millions)

Assets:									Assets:
Inventories carried at market	$	—	$	3,102	$	1,322	$	4,424	Inventories carried at market	$	—	$	6,765	$	3,004	$	9,769
Unrealized derivative gains:									Unrealized derivative gains:
Commodity contracts	—		371		140		511		Commodity contracts	—		902		460		1,362
Foreign exchange contracts	—		102		—		102
Foreign currency contracts									Foreign currency contracts	—		238		—		238
Interest rate contracts	—		11		—		11		Interest rate contracts	—		46		—		46
Cash equivalents	286		—		—		286		Cash equivalents	448		—		—		448
Marketable securities	408		69		—		477

Segregated investments	1,613		—		—		1,613		Segregated investments	1,338		—		—		1,338
Deferred receivables consideration	—		540		—		540

Total Assets	$	2,307	$	4,195	$	1,462	$	7,964	Total Assets	$	1,786	$	7,951	$	3,464	$	13,201

Liabilities:									Liabilities:
Unrealized derivative losses:									Unrealized derivative losses:
Commodity contracts	$	—	$	419	$	142	$	561	Commodity contracts	$	—	$	944	$	815	$	1,759
Foreign exchange contracts	—		90		—		90
Foreign currency contracts									Foreign currency contracts	—		191		—		191

Debt conversion option									Debt conversion option	—		—		15		15
Inventory-related payables	—		491		30		521		Inventory-related payables	—		859		106		965
Total Liabilities	$	—	$	1,000	$	172	$	1,172	Total Liabilities	$	—	$	1,994	$	936	$	2,930

Estimated fair values for inventories and inventory-related payables carried at market are based on exchange-quoted prices, adjusted for differences in local markets ~~broker or dealer quotations or market transactions in either listed or over-the-counter (OTC) markets.~~and quality, referred to as basis. Market valuations for the Company’s inventories are adjusted for location and quality (basis) because the exchange-quoted prices represent contracts that have standardized terms for commodity, quantity, future delivery period, delivery location, and commodity quality or grade. The basis adjustments are generally determined using the inputs from competitor and broker quotations or market transactions in either the listed or over the counter (OTC) markets and are considered observable. In some cases, the basis adjustments are unobservable because they are supported by little to no market activity. When unobservable inputs have a significant impact (more than 10%) on the measurement of fair value, the inventory is classified in Level 3. Changes in the fair value of inventories are recognized in the consolidated statements of earnings as a component of cost of products sold.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 5.~~	~~Fair Value Measurements (Continued)~~

Note 4. Fair Value Measurements (Continued)

Derivative contracts include exchange-traded commodity futures and options contracts, forward commodity purchase and sale contracts, and OTC instruments related primarily to agricultural commodities, energy, interest rates, and foreign currencies. Exchange-traded futures and options contracts are valued based on unadjusted quoted prices in active markets and are classified in Level 1. The majority of the Company’s exchange-traded futures and options contracts are cash-settled on a daily basis and, therefore, are not included in these tables. Fair value for forward commodity purchase and sale contracts is estimated based on exchange-quoted prices adjusted for differences in local markets. ~~These differences~~Market valuations for the Company’s forward commodity purchase and sale contracts are adjusted for location (basis) because the exchange-quoted prices represent contracts that have standardized terms for commodity, quantity, future delivery period, delivery location, and commodity quality or grade. The basis adjustments are generally determined using inputs from competitor and broker ~~or dealer~~ quotations or market transactions in either the listed or OTC ~~markets.~~markets and are considered observable. In some cases, the basis adjustments are unobservable because they are supported by little to no market activity. When observable inputs are available for substantially the full term of the contract, it is classified in Level 2. When unobservable inputs have a significant impact (more than 10%) on the measurement of fair value, the contract is classified in Level 3. Except for certain derivatives designated as cash flow hedges, changes in the fair value of commodity-related derivatives are recognized in the consolidated statements of earnings as a component of cost of products sold. Changes in the fair value of foreign currency-related derivatives are recognized in the consolidated statements of earnings as a component of revenues, cost of products sold, or other (income) expense - net, depending upon the purpose of the contract. The ~~effective portions of~~ changes in the fair value of derivatives designated as effective cash flow hedges are recognized in the consolidated balance sheets as a component of accumulated other comprehensive income (loss) (AOCI) until the hedged items are recorded in earnings or it is probable the hedged transaction will no longer occur.

The Company’s cash equivalents are comprised of money market funds valued using quoted market prices and are classified asin Level 1.

The Company’s marketable securities are comprised of equity investments, U.S. Treasury securities, corporate debt securities, and other debt securities. Publicly traded equity investments and U.S. Treasury securities are valued using quoted market prices and are classified in Level 1. Corporate debt and other debt securities are valued using third-party pricing services and substantially all are classified in Level 2. Unrealized changes in the fair value of available-for-sale marketable securities are recognized in the consolidated balance sheets as a component of AOCI unless a decline in value is deemed to be other-than-temporary at which point the decline is recorded in earnings.

The Company’s segregated investments are comprised of U.S. Treasury securities. U.S. Treasury securities are valued using quoted market prices and are classified in Level 1.

The ~~Company has deferred consideration under its accounts receivable securitization programs (the “Programs”) which represents notes receivable from~~debt conversion option is the ~~purchasers under~~equity-linked embedded derivative related to the ~~Programs (see Note 16). This amount is reflected~~exchangeable bonds issued in ~~other current assets on the consolidated balance sheet (see Note 8). The Company carries the deferred consideration at fair value determined by calculating the expected amount of cash to be received.~~August 2020. The fair value ~~is principally based on observable inputs (a Level 2 measurement) consisting mainly~~ of the ~~face amount~~embedded derivative is included in long-term debt, with changes in fair value recognized as interest, and is valued with the assistance of the receivables adjusted for anticipated credit losses and discounted at the appropriate market rate. Payment of deferred consideration is not subject to significant risks other than delinquencies and credit losses on accounts receivable transferred under the Programs, which have historically been insignificant.a third-party pricing service (a level 3 measurement).

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 5.~~	~~Fair Value Measurements (Continued)~~

The following table presents a ~~reconciliation~~rollforward of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended September 30, ~~2017~~.2022.


	Level 3 Fair Value Asset Measurements at
	September 30, 2022
	Inventories Carried at Market		Commodity Derivative Contracts Gains		Total Assets
	(In millions)
Balance, June 30, 2022	$	3,245	$	880	$	4,125
Total increase (decrease) in net realized/unrealized gains included in cost of products sold*	315		345		660
Purchases	13,294		—		13,294
Sales	(13,931)		—		(13,931)
Settlements	—		(456)		(456)
Transfers into Level 3	384		49		433
Transfers out of Level 3	(221)		(116)		(337)
Ending balance, September 30, 2022	$	3,086	$	702	$	3,788

Level 3 Fair Value Asset Measurements at
September 30, 2017

Inventories
Carried at
Market

Commodity
Derivative
Contracts
Gains

Total
Assets
(In millions)

Balance, June 30, 2017 $ 1,000
$ 106
$ 1,106
Total increase (decrease) in net realized/unrealized gains included in cost of products sold* 15
54
69
Purchases 2,792
—
2,792
Sales (2,655 ) —
(2,655 )
Settlements —
(82 ) (82 )
Transfers into Level 3 37
45
82
Transfers out of Level 3 (95 ) (3 ) (98 )
Ending balance, September 30, 2017 $ 1,094
$ 120
$ 1,214

* Includes increase in unrealized gains of ~~$52~~$481 million relating to Level 3 assets still held at September 30, ~~2017~~.2022.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 4. Fair Value Measurements (Continued)

The following table presents a ~~reconciliation~~rollforward of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended September 30, ~~2017~~.2022.


	Level 3 Fair Value Liability Measurements at
	September 30, 2022
	Inventory- related Payables		Commodity Derivative Contracts Losses		Debt Conversion Option		Total Liabilities
	(In millions)

Balance, June 30, 2022	$	55	$	960	$	11	$	1,026
Total increase (decrease) in net realized/unrealized losses included in cost of products sold and interest expense*	3		391		(8)		386
Purchases	167		—		—		167
Sales	(5)		—		—		(5)
Settlements	—		(634)		—		(634)
Transfers into Level 3	—		57		—		57
Transfers out of Level 3	—		(65)		—		(65)
Ending balance, September 30, 2022	$	220	$	709	$	3	$	932

Level 3 Fair Value Liability Measurements at
September 30, 2017

Inventory-
related
Payables

Commodity
Derivative
Contracts
Losses

Total
Liabilities
(In millions)

Balance, June 30, 2017 $ 32
$ 154
$ 186
Total increase (decrease) in net realized/unrealized losses included in cost of products sold* (9 ) 82
73
Purchases 2
—
2
Sales (5 ) —
(5 )
Settlements —
(123 ) (123 )
Transfers into Level 3 —
35
35
Transfers out of Level 3 —
(3 ) (3 )
Ending balance, September 30, 2017 $ 20
$ 145
$ 165

* Includes increase in unrealized losses of ~~$79~~$394 million relating to Level 3 liabilities still held at September 30, ~~2017~~.2022.

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 5.~~	~~Fair Value Measurements (Continued)~~


	Level 3 Fair Value Asset Measurements at
	September 30, 2021
	Inventories Carried at Market		Commodity Derivative Contracts Gains		Total Assets
	(In millions)

Balance, June 30, 2021	$	2,824	$	551	$	3,375
Total increase (decrease) in net realized/unrealized gains included in cost of products sold*	70		288		358
Purchases	7,351		—		7,351
Sales	(7,346)		—		(7,346)
Settlements	—		(311)		(311)
Transfers into Level 3	205		34		239
Transfers out of Level 3	(602)		(77)		(679)
Ending balance, September 30, 2021	$	2,502	$	485	$	2,987

Level 3 Fair Value Asset Measurements at
September 30, 2016

Inventories
Carried at
Market

Commodity
Derivative
Contracts
Gains

Total
Assets
(In millions)

Balance, June 30, 2016 $ 1,099
$ 153
$ 1,252
Total increase (decrease) in net realized/unrealized gains included in cost of products sold* (97 ) 76
(21 )
Purchases 2,523
—
2,523
Sales (2,529 ) —
(2,529 )
Settlements —
(85 ) (85 )
Transfers into Level 3 206
66
272
Transfers out of Level 3 (38 ) (6 ) (44 )
Ending balance, September 30, 2016 $ 1,164
$ 204
$ 1,368

* Includes increase in unrealized gains of ~~$22~~$435 million relating to Level 3 assets still held at September 30, ~~2016~~.2021.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 4. Fair Value Measurements (Continued)


	Level 3 Fair Value Liability Measurements at
	September 30, 2021
	Inventory- related Payables		Commodity Derivative Contracts Losses		Debt Conversion Option		Total Liabilities
	(In millions)

Balance, June 30, 2021	$	38	$	1,037	$	24	$	1,099
Total increase (decrease) in net realized/unrealized losses included in cost of products sold and interest expense*	3		310		(7)		306
Purchases	1		—		—		1
Sales	(27)		—		—		(27)
Settlements	—		(654)		—		(654)
Transfers into Level 3	—		60		—		60
Transfers out of Level 3	—		(50)		—		(50)
Ending balance, September 30, 2021	$	15	$	703	$	17	$	735

Level 3 Fair Value Liability Measurements at
September 30, 2016

Inventory-
related
Payables

Commodity
Derivative
Contracts
Losses

Total
Liabilities
(In millions)

Balance, June 30, 2016 $ 12
$ 500
$ 512
Total increase (decrease) in net realized/unrealized losses included in cost of products sold* 3
(1 ) 2
Purchases 3
—
3
Sales (3 ) —
(3 )
Settlements —
(247 ) (247 )
Transfers into Level 3 —
33
33
Transfers out of Level 3 —
(167 ) (167 )
Ending balance, September 30, 2016 $ 15
$ 118
$ 133

* Includes increase in unrealized losses of $1$313 million relating to Level 3 liabilities still held at September 30, ~~2016~~.2021.

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 5.~~	~~Fair Value Measurements (Continued)~~

The following table presents a ~~reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended~~ ~~September 30, 2017~~.

Level 3 Fair Value Asset Measurements at
September 30, 2017

Inventories
Carried at
Market

Commodity
Derivative
Contracts
Gains

Total
Assets
(In millions)

Balance, December 31, 2016 $ 1,322
$ 140
$ 1,462
Total increase (decrease) in net realized/unrealized gains included in cost of products sold* (55 ) 194
139
Purchases 8,369
—
8,369
Sales (8,526 ) —
(8,526 )
Settlements —
(291 ) (291 )
Transfers into Level 3 37
111
148
Transfers out of Level 3 (53 ) (34 ) (87 )
Ending balance, September 30, 2017 $ 1,094
$ 120
$ 1,214

* Includes increase in unrealized gains of $18 million relating to Level 3 assets still held at ~~September 30, 2017~~.

~~The following table presents a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended~~ ~~September 30, 2017~~.

Level 3 Fair Value Liability Measurements at
September 30, 2017

Inventory-
related
Payables

Commodity
Derivative
Contracts
Losses

Total
Liabilities
(In millions)

Balance, December 31, 2016 $ 30
$ 142
$ 172
Total increase (decrease) in net realized/unrealized losses included in cost of products sold* (4 ) 201
197
Purchases 19
—
19
Sales (25 ) —
(25 )
Settlements —
(289 ) (289 )
Transfers into Level 3 —
108
108
Transfers out of Level 3 —
(17 ) (17 )
Ending balance, September 30, 2017 $ 20
$ 145
$ 165

* Includes increase in unrealized losses of $204 million relating to Level 3 liabilities still held at ~~September 30, 2017~~.

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 5.~~	~~Fair Value Measurements (Continued)~~

~~The following table presents a reconciliation~~rollforward of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, ~~2016.~~2022.


	Level 3 Fair Value Asset Measurements at
	September 30, 2022
	Inventories Carried at Market		Commodity Derivative Contracts Gains		Total Assets
	(In millions)

Balance, December 31, 2021	$	3,004	$	460	$	3,464
Total increase (decrease) in net realized/unrealized gains included in cost of products sold*	746		1,297		2,043
Purchases	34,524		—		34,524
Sales	(35,239)		—		(35,239)
Settlements	—		(1,227)		(1,227)
Transfers into Level 3	933		365		1,298
Transfers out of Level 3	(882)		(193)		(1,075)
Ending balance, September 30, 2022	$	3,086	$	702	$	3,788

Level 3 Fair Value Asset Measurements at
September 30, 2016

Inventories
Carried at
Market

Commodity
Derivative
Contracts
Gains

Total
Assets
(In millions)

Balance, December 31, 2015 $ 1,004
$ 243
$ 1,247
Total increase (decrease) in net realized/unrealized gains included in cost of products sold* (210 ) 171
(39 )
Purchases 7,565
—
7,565
Sales (7,272 ) —
(7,272 )
Settlements —
(302 ) (302 )
Transfers into Level 3 206
132
338
Transfers out of Level 3 (129 ) (40 ) (169 )
Ending balance, September 30, 2016 $ 1,164
$ 204
$ 1,368

*Includes increase in unrealized gains of ~~$36 million~~$2.2 billion relating to Level 3 assets still held at September 30, ~~2016.~~2022.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 4. Fair Value Measurements (Continued)


	Level 3 Fair Value Liability Measurements at
	September 30, 2022
	Inventory- related Payables		Commodity Derivative Contracts Losses		Debt Conversion Option		Total Liabilities
	(In millions)

Balance, December 31, 2021	$	106	$	815	$	15	$	936
Total increase (decrease) in net realized/unrealized losses included in cost of products sold and interest expense*	(1)		2,060		(12)		2,047
Purchase	176		—		—		176
Sales	(61)		—		—		(61)
Settlements	—		(2,363)		—		(2,363)
Transfers into Level 3	—		379		—		379
Transfers out of Level 3	—		(182)		—		(182)
Ending balance, September 30, 2022	$	220	$	709	$	3	$	932

Level 3 Fair Value Liability Measurements at
September 30, 2016

Inventory-
related
Payables

Commodity
Derivative
Contracts
Losses

Total
Liabilities
(In millions)

Balance, December 31, 2015 $ 16
$ 113
$ 129
Total increase (decrease) in net realized/unrealized losses included in cost of products sold* 5
494
499
Purchases 5
—
5
Sales (11 ) —
(11 )
Settlements —
(392 ) (392 )
Transfers into Level 3 —
115
115
Transfers out of Level 3 —
(212 ) (212 )
Ending balance, September 30, 2016 $ 15
$ 118
$ 133

*Includes increase in unrealized losses of ~~$499 million~~$2.1 billion relating to Level 3 liabilities still held at September 30, 2022.

The following table presents a rollforward of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the nine months ended September 30, 2021.


	Level 3 Fair Value Asset Measurements at
	September 30, 2021
	Inventories Carried at Market		Commodity Derivative Contracts Gains		Total Assets
	(In millions)

Balance, December 31, 2020	$	2,183	$	859	$	3,042
Total increase (decrease) in net realized/unrealized gains included in cost of products sold*	875		804		1,679
Purchases	20,899		—		20,899
Sales	(21,334)		—		(21,334)
Settlements	—		(1,134)		(1,134)
Transfers into Level 3	1,131		79		1,210
Transfers out of Level 3	(1,252)		(123)		(1,375)
Ending balance, September 30, 2021	$	2,502	$	485	$	2,987

* Includes increase in unrealized gains of $1.7 billion relating to Level 3 assets still held at September 30, ~~2016.~~2021.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 5.~~	~~Fair Value Measurements (Continued)~~

Note 4. Fair Value Measurements (Continued)

~~For all periods presented,~~The following table presents a rollforward of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the ~~Company had no transfers between~~nine months ended September 30, 2021.


	Level 3 Fair Value Liability Measurements at
	September 30, 2021
	Inventory- related Payables		Commodity Derivative Contracts Losses		Debt Conversion Option		Total Liabilities
	(In millions)

Balance, December 31, 2020	$	11	$	918	$	34	$	963
Total increase (decrease) in net realized/unrealized losses included in cost of products sold and interest expense*	3		1,372		(17)		1,358
Purchases	30		—		—		30
Sales	(29)		—		—		(29)
Settlements	—		(1,667)		—		(1,667)
Transfers into Level 3	—		284		—		284
Transfers out of Level 3	—		(204)		—		(204)
Ending balance, September 30, 2021	$	15	$	703	$	17	$	735

* Includes increase in unrealized losses of $1.4 billion relating to Level ~~1 and 2.~~ 3 liabilities still held at September 30, 2021.

Transfers into Level 3 of assets and liabilities previously classified in Level 2 were due to the relative value of unobservable inputs to the total fair value measurement of certain products and derivative contracts rising above the 10% threshold. Transfers out of Level 3 were primarily due to the relative value of unobservable inputs to the total fair value measurement of certain products and derivative contracts falling below the 10% threshold and thus permitting reclassification to Level 2.

In some cases, the price components that result in differences between exchange-traded prices and local prices for inventories and commodity purchase and sale contracts are observable based upon available quotations for these pricing components, and in some cases, the differences are unobservable. These price components primarily include transportation costs and other adjustments required due to location, quality, or other contract terms. In the table below, these other adjustments are referred to as ~~Basis.~~basis. The changes in unobservable price components are determined by specific local supply and demand characteristics at each facility and the overall market. Factors such as substitute products, weather, fuel costs, contract terms, and futures prices also impact the movement of these unobservable price components.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 4. Fair Value Measurements (Continued)

The following table sets forth the weighted average percentage of the unobservable price components included in the Company’s Level 3 valuations as of September 30, ~~2017~~2022 and December 31, ~~2016~~.2021. The Company’s Level 3 measurements may include ~~Basis~~basis only, transportation cost only, or both price components. As an example, for Level 3 inventories with ~~Basis,~~basis, the unobservable component as of September 30, ~~2017~~2022 is a weighted average ~~16.2%~~27.9% of the total price for assets and ~~62.7%~~18.1% of the total price for liabilities.


	Weighted Average % of Total Price
	September 30, 2022				December 31, 2021
Component Type	Assets		Liabilities		Assets		Liabilities
Inventories and Related Payables
Basis	27.9	%	18.1	%	28.7	%	13.1	%
Transportation cost	2.9	%	—	%	13.0	%	—	%

Commodity Derivative Contracts
Basis	29.9	%	22.8	%	30.0	%	27.1	%
Transportation cost	7.0	%	17.0	%	8.1	%	0.7	%

Weighted Average % of Total Price
September 30, 2017 December 31, 2016
Component Type Assets Liabilities Assets Liabilities
Inventories and Related Payables
Basis 16.2 % 62.7 % 16.5 % 67.1 %
Transportation cost 18.2 % — % 8.3 % —

Commodity Derivative Contracts
Basis 22.3 % 21.3 % 16.9 % 27.0 %
Transportation cost 12.9 % 12.3 % 11.6 % 13.4 %

In certain of the Company’s principal markets, the Company relies on price quotes from third parties to value its inventories and physical commodity purchase and sale contracts. These price quotes are generally not further adjusted by the Company in determining the applicable market price. In some cases, availability of third-party quotes is limited to only one or two independent sources. In these situations, absent other corroborating evidence, the Company considers these price quotes as 100% unobservable and, therefore, the fair value of these items is reported in Level 3.

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 6.~~	~~Derivative Instruments and Hedging Activities~~

Note 5. Derivative Instruments and Hedging Activities

Derivatives Not Designated as Hedging Instruments

The majority of the Company’s derivative instruments have not been designated as hedging instruments. The Company uses exchange-traded futures and exchange-traded and OTC options contracts to manage its net position of merchandisable agricultural ~~commodity~~product inventories and forward cash purchase and sales contracts to reduce price risk caused by market fluctuations in agricultural commodities and foreign currencies. The Company also uses exchange-traded futures and exchange-traded and OTC options contracts as components of merchandising strategies designed to enhance margins. The results of these strategies can be significantly impacted by factors such as the correlation between the value of exchange-traded commodities futures contracts and the value of the underlying commodities, counterparty contract defaults, and volatility of freight markets. Derivatives, including exchange-traded contracts and ~~physical~~forward commodity purchase or sale contracts, ~~are stated at market value~~ and inventories of certain merchandisable agricultural ~~commodities,~~products, which include amounts acquired under deferred pricing contracts, are stated at fair value or market value. Inventory is not a derivative and therefore fair values of and changes in fair values of inventories are not included in the tables below.

The following table sets forth the fair value of derivatives not designated as hedging instruments as of September 30, ~~2017~~2022 and December 31, ~~2016~~.2021.


	September 30, 2022				December 31, 2021
	Assets		Liabilities		Assets		Liabilities
	(In millions)

Foreign Currency Contracts	$	380	$	337	$	217	$	116

Commodity Contracts	1,373		1,390		1,276		1,759
Debt Conversion Option	—		3		—		15
Total	$	1,753	$	1,730	$	1,493	$	1,890

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 5. Derivative Instruments and Hedging Activities (Continued)

September 30, 2017 December 31, 2016
Assets Liabilities Assets Liabilities
(In millions)

Foreign Currency Contracts $ 81
$ 119
$ 102
$ 90
Commodity Contracts 360
445
511
561
Total $ 441
$ 564
$ 613
$ 651

The following ~~table sets~~tables set forth the pre-tax gains (losses) on derivatives not designated as hedging instruments that have been included in the consolidated statements of earnings for the three and nine months ended September 30, ~~2017~~2022 and ~~2016~~.2021.


					Other expense (income) - net
			Cost of				Interest
(In millions)	Revenues		products sold				expense
Three Months Ended September 30, 2022
Consolidated Statement of Earnings	$	24,683	$	22,872	$	(67)	$	97

Pre-tax gains (losses) on:





Foreign Currency Contracts	$	(5)	$	6	$	151	$	—
Commodity Contracts	—		134		—		—
Debt Conversion Option	—		—		—		8
Total gain (loss) recognized in earnings	$	(5)	$	140	$	151	$	8	$	294

Three Months Ended September 30, 2021
Consolidated Statement of Earnings	$	20,340	$	19,014	$	20	$	61

Pre-tax gains (losses) on:
Foreign Currency Contracts	$	13	$	(92)	$	62	$	—
Commodity Contracts	—		214		—		—
Debt Conversion Option	—		—		—		7
Total gain (loss) recognized in earnings	$	13	$	122	$	62	$	7	$	204


					Other expense (income) - net
			Cost of				Interest
(In millions)	Revenues		products sold				expense
Nine Months Ended September 30, 2022
Consolidated Statement of Earnings	$	75,617	$	69,809	$	(183)	$	262

Pre-tax gains (losses) on:
Foreign Currency Contracts	$	(30)	$	354	$	414	$	—
Commodity Contracts	—		95		—		—
Debt Conversion Option	—		—		—		12
Total gain (loss) recognized in earnings	$	(30)	$	449	$	414	$	12	$	845

Nine Months Ended September 30, 2021
Consolidated Statement of Earnings	$	62,159	$	57,822	$	36	$	188

Pre-tax gains (losses) on:
Foreign Currency Contracts	$	—	$	(140)	$	137	$	—
Commodity Contracts	—		(1,241)		—		—
Debt Conversion Option	—		—		—		17
Total gain (loss) recognized in earnings	$	—	$	(1,381)	$	137	$	17	$	(1,227)

Three months ended September 30,
2017 2016
(In millions)
Foreign Currency Contracts

Revenues $ (8 ) $ (19 )
Cost of products sold 52
1
Other income (expense) – net 52
(3 )

Commodity Contracts

Cost of products sold 34
369
Total gain (loss) recognized in earnings $ 130
$ 348

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 6.~~	Note 5. Derivative Instruments and Hedging Activities (Continued)

Nine months ended September 30,
2017 2016
(In millions)
Foreign Currency Contracts

Revenues $ (16 ) $ (32 )
Cost of products sold 82
263
Other income (expense) – net 186
(108 )

Commodity Contracts

Cost of products sold $ 294
$ (266 )
Total gain (loss) recognized in earnings $ 546
$ (143 )

~~Inventories of certain merchandisable agricultural commodities, which include amounts acquired under deferred pricing contracts, are stated at market value.~~ Changes in the market value of inventories of certain merchandisable agricultural commodities, forward cash purchase and sales contracts, exchange-traded futures and exchange-traded and OTC options contracts are recognized in earnings ~~immediately.~~immediately as a component of cost of products sold.

Changes in the fair value of foreign currency-related derivatives are recognized in the consolidated statements of earnings as a component of revenues, cost of products sold, and other (income) expense - net depending on the purpose of the contract.

Derivatives Designated as Cash Flow ~~or Fair Value~~and Net Investment Hedging Strategies

~~As of~~ ~~September 30, 2017~~ ~~and~~ ~~December 31, 2016, the~~The Company ~~has~~had certain derivatives designated as cash flow and ~~fair value hedges.~~net investment hedges as of September 30, 2022 and December 31, 2021.

For derivative instruments that are designated and qualify as net investment hedges, foreign exchange gains and losses related to changes in foreign currency exchange rates are deferred in AOCI until the underlying investment is divested.

The Company uses cross-currency swaps and foreign exchange forwards designated as net investment hedges to protect the Company’s investment in a foreign subsidiary against changes in foreign currency exchange rates. The Company executed USD-fixed to Euro-fixed cross-currency swaps with an aggregate notional amount of $0.7 billion and $1.2 billion as of September 30, 2022 and December 31, 2021, respectively, and foreign exchange forwards with an aggregate notional amount of $2.3 billion and $2.6 billion as of September 30, 2022 and December 31, 2021, respectively.

As of September 30, 2022 and December 31, 2021, the Company had after-tax gains of $283 million and after-tax losses of $44 million in AOCI, respectively, related to foreign exchange gains and losses from these net investment hedge transactions. The amount is deferred in AOCI until the underlying investment is divested.

For derivative instruments that are designated and qualify as highly-effective cash flow hedges (i.e., hedging the exposure to variability in expected future cash flow that is attributable to a particular risk), the gain or loss on the derivative instrument is reported as a component of AOCI and as an operating activity in the statement of cash flows, and is reclassified into earnings in the same line item affected by the hedged transaction in the same period or periods during which the hedged transaction affects earnings. Hedge components excluded from the assessment of effectiveness and gains and losses related to discontinued hedges are recognized in the consolidated statement of earnings during the current period.

The Company’s structured trade finance programs use interest rate swaps designated as ~~fair value~~cash flow hedges to ~~protect~~hedge the ~~fair value~~forecasted interest payments on certain letters of ~~fixed-rate debt due to changes in interest rates. The changes in the fair value of the interest rate swaps and the underlying fixed-rate debt are recorded in other (income) expense - net.~~credit from banks. The terms of the interest rate swaps match the terms of the ~~underlying debt resulting~~forecasted interest payments. The deferred gains and losses are recognized in ~~no ineffectiveness. At~~ revenues over the period in which the related interest payments are paid to the banks. The amounts are recorded in revenues as the related results are also recorded in revenues. As of September 30, ~~2017~~,2022 and December 31, 2021, the Company ~~has $2~~had interest rate swaps maturing on various dates with aggregate notional amounts of $0.5 billion and $1.0 billion, respectively.

The Company also uses swap locks designated as cash flow hedges to hedge the changes in the forecasted interest payments due to changes in the benchmark rate leading up to future bond issuance dates. The terms of the swap locks match the terms of the forecasted interest payments. The deferred gains and losses will be recognized in interest expense over the period in which the related interest payments will be paid. As of September 30, 2022 and December 31, 2021, the Company executed swap locks maturing on various dates with an aggregate notional amount of $400 million.

As of September 30, 2022 and December 31, 2021, the Company had after-tax gains of $80 million and $35 million in ~~other current assets representing the fair value of~~AOCI, respectively, related to the interest rate swaps and ~~a corresponding increase~~swap locks. The Company expects to recognize amounts deferred in AOCI in its consolidated statement of earnings during the ~~underlying~~life of the debt ~~for the same amount with no net impact~~instruments.

Archer-Daniels-Midland Company

Notes to ~~earnings.~~Consolidated Financial Statements (Continued)

(Unaudited)

Note 5. Derivative Instruments and Hedging Activities (Continued)

For each of the ~~commodity~~ hedge programs described below, the derivatives are designated as cash flow hedges. ~~Assuming normal market conditions, the~~The changes in the market value of such derivative contracts have historically been, and are expected to continue to be, highly effective at offsetting changes in price movements of the hedged item. Once the hedged item is recognized in earnings, the ~~gains/~~gains and losses arising from the hedge are reclassified from AOCI to either revenues or cost of products sold, as applicable. As of September 30, ~~2017~~,2022 and December 31, 2021, the Company ~~has $12~~had after-tax gains of $270 million ~~of after-tax losses~~and $161 million in AOCI, respectively, related to gains and losses from ~~commodity cash flow hedge transactions.~~these programs. The Company expects to recognize ~~$12~~$270 million of ~~these~~the September 30, 2022 after-tax ~~losses~~gains in its consolidated statement of earnings during the next 12 months.

The Company uses futures or options contracts to ~~fix~~hedge the purchase price of anticipated volumes of corn to be purchased and processed in a future month. The objective of this hedging program is to reduce the variability of cash flows associated with the Company’s forecasted purchases of corn. The Company’s corn processing plants ~~currently~~normally grind approximately 7265 million bushels of corn per month. During the past 12 months, the Company hedged between ~~19%~~17% and ~~62%~~32% of its monthly ~~anticipated~~ grind. At September 30, ~~2017~~,2022, the Company ~~has~~had designated hedges representing between 6%5% and ~~41%~~33% of its anticipated monthly grind of corn for the next 12 months.

The Company, from time to time, also uses futures, options, and swaps to ~~fix~~hedge the sales price of certain ethanol sales contracts. The Company has established hedging programs for ethanol sales contracts that are indexed to unleaded gasoline prices and to various exchange-traded ethanol contracts. The objective of these hedging programs is to reduce the variability of cash flows associated with the Company’s sales of ethanol. During the past 12 months and as of September 30, 2022, the Company had no hedges related to ethanol sales under these programs.

The Company uses futures and options contracts to hedge the purchase price of the anticipated volumes of soybeans to be purchased and processed in a future month for certain of its U.S. soybean crush facilities, subject to certain program limits. The Company also uses futures or options contracts to hedge the sales prices of anticipated soybean meal and soybean oil sales proportionate to the soybean crushing process at these facilities, subject to certain program limits. During the past 12 months, the Company hedged between ~~1 million~~85% and ~~66 million~~ ~~gallons~~100% of ~~ethanol~~the anticipated monthly soybean crush for soybean purchases and soybean meal and oil sales ~~per month under these programs.~~at the designated facilities. At September 30, ~~2017,~~2022, the Company ~~has~~had designated hedges representing between 00% and ~~1 million~~ ~~gallons~~100% of ~~ethanol~~the anticipated monthly soybean crush for soybean purchases and soybean meal and oil sales ~~per month~~at the designated facilities over the next 12 months.

~~Archer-Daniels-Midland~~The Company uses futures and OTC swaps to hedge the purchase price of anticipated volumes of natural gas consumption in a future month for certain of its facilities in North America and Europe, subject to certain program limits. During the past 12 months, the Company hedged between 0% and 121% of the anticipated monthly natural gas consumption at the designated facilities. At September 30, 2022, the Company had designated hedges representing between 0% and 89% of the anticipated monthly natural gas consumption over the next 12 months.

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 6.~~	~~Derivative Instruments and Hedging Activities (Continued)~~

The following table sets forth the fair value of derivatives designated as hedging instruments as of September 30, ~~2017~~2022 and December 31, ~~2016~~.2021.


	September 30, 2022				December 31, 2021
	Assets		Liabilities		Assets		Liabilities
	(In millions)
Commodity Contracts	$	86	$	—	$	86	$	—
Foreign Currency Contracts	371		—		21		$	75
Interest Rate Contracts	105		—		46		—
Total	$	562	$	—	$	153	$	75

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 5. Derivative Instruments and Hedging Activities (Continued)

September 30, 2017 December 31, 2016
Assets Liabilities Assets Liabilities
(In millions)
Interest Rate Contracts $ 2
$ —
$ 11
$ —
Total $ 2
$ —
$ 11
$ —

The following table sets forth the pre-tax gains (losses) on derivatives designated as hedging instruments that have been included in the consolidated statements of earnings for the three and nine months ended September 30, ~~2017~~2022 and ~~2016~~.2021.


			Cost of products sold
(In millions)	Revenues
Three Months Ended September 30, 2022
Consolidated Statement of Earnings	$	24,683	$	22,872

Effective amounts recognized in earnings
Pre-tax gains (losses) on:

Commodity Contracts	$	—	$	117
Interest Contracts	1		—
Total gain (loss) recognized in earnings	$	1	$	117	$	118

Three Months Ended September 30, 2021
Consolidated Statement of Earnings	$	20,340	$	19,014

Effective amounts recognized in earnings
Pre-tax gains (losses) on:

Commodity Contracts	$	—	$	122
Interest Contracts	—		—



Total gain (loss) recognized in earnings	$	—	$	122	$	122


			Cost of products sold
(In millions)	Revenues
Nine Months Ended September 30, 2022
Consolidated Statement of Earnings	$	75,617	$	69,809

Effective amounts recognized in earnings
Pre-tax gains (losses) on:

Commodity Contracts	$	—	$	365
Interest Contracts	1		—
Total gain (loss) recognized in earnings	$	1	$	365	$	366

Nine Months Ended September 30, 2021
Consolidated Statement of Earnings	$	62,159	$	57,822

Effective amounts recognized in earnings
Pre-tax gains (losses) on:

Commodity Contracts	$	—	$	450
Interest Contracts	(15)		—



Total gain (loss) recognized in earnings	$	(15)	$	450	$	435

Three months ended

Consolidated Statement of
Earnings Locations
September 30,
2017 2016
(In millions)
Effective amounts recognized in earnings
Foreign Currency Contracts Other income/expense – net $ —
$ (3 )
Interest Contracts Interest expense —
(2 )
Commodity Contracts Revenues —
(9 )
Cost of products sold (15 ) (37 )
Ineffective amount recognized in earnings
Commodity Contracts Revenues —
(1 )

Cost of products sold (4 ) 1
Total amount recognized in earnings $ (19 ) $ (51 )

Nine months ended

Consolidated Statement of
Earnings Locations
September 30,
2017 2016
(In millions)
Effective amounts recognized in earnings
Foreign Currency Contracts Other income/expense – net $ (2 ) $ (25 )
Interest Contracts Interest expense —
(2 )
Commodity Contracts Revenues —
(14 )

Cost of products sold (20 ) (61 )
Ineffective amount recognized in earnings
Commodity Contracts Revenues 4
—

Cost of products sold 5
5
Total amount recognized in earnings $ (13 ) $ (97 )
25

Hedge ineffectiveness for commodity contracts results when the change in the price of the underlying commodity in a specific cash market differs from the change in the price of the derivative financial instrument used to establish the hedging relationship. As an example, if the change in the price of a corn futures contract is strongly correlated to the change in cash price paid for corn, the gain or loss on the derivative instrument is deferred and recognized at the time the corn grind occurs. If the change in price of the derivative does not strongly correlate to the change in the cash price of corn, in the same example, some portion or all of the derivative gains or losses may be required to be recognized in earnings prior to when the corn grind occurs.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 6.~~	~~Derivative Instruments and Hedging Activities (Continued)~~

Note 5. Derivative Instruments and Hedging Activities (Continued)

Other Net Investment Hedging Strategies

~~On June 24, 2015, the Company issued €500 million aggregate principal amount of Floating Rate Notes and €600 million aggregate principal amount of 1.75% Notes (collectively, the “Notes”).~~ The Company has designated ~~€1.1~~€1.3 billion and €1.8 billion of ~~the Notes~~its outstanding long-term debt and commercial paper borrowings at September 30, 2022 and December 31, 2021, respectively, as ~~a hedge~~hedges of its net investment in a foreign subsidiary. As of September 30, ~~2017,~~2022 and December 31, 2021, the Company ~~has $47~~had after-tax gains of $311 million ~~of after-tax losses~~and $55 million in AOCI, respectively, related to foreign exchange gains and losses from ~~the~~ net investment hedge ~~transaction.~~transactions. The amount is deferred in AOCI until the underlying investment is divested.


~~Note 7.~~	~~Marketable Securities~~

Cost
Unrealized
Gains

Unrealized
Losses

Fair
Value
(In millions)

September 30, 2017
United States government obligations
Maturity less than 1 year $ 259
$ —
$ —
$ 259
Maturity 1 to 5 years 117
—
—
117
Corporate debt securities

Maturity less than 1 year 2
—
—
2
Maturity 1 to 5 years 90
—
—
90
$ 468
$ —
$ —
$ 468

Cost
Unrealized
Gains

Unrealized
Losses

Fair
Value
(In millions)

December 31, 2016
United States government obligations
Maturity less than 1 year $ 287
$ —
$ —
$ 287
Maturity 1 to 5 years 121
—
(1 ) 120
Corporate debt securities

Maturity less than 1 year 1
—
—
1
Maturity 1 to 5 years 66
—
—
66
Other debt securities

Maturity less than 1 year 8
—
—
8
Equity securities

Available-for-sale 1
—
—
1
$ 484
$ —
$ (1 ) $ 483

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~

Note 8.6. Other Current Assets

The following table sets forth the items in other current assets:


	September 30,		December 31,
	2022		2021
	(In millions)

Unrealized gains on derivative contracts	$	2,315	$	1,646

Margin deposits and grain accounts	858		600
Customer omnibus receivable	1,328		1,179
Financing receivables - net (1)	202		189
Insurance premiums receivable	38		20
Prepaid expenses	473		370
Biodiesel tax credit	54		79
Tax receivables	527		708
Non-trade receivables (2)	316		285
Other current assets	53		82
	$	6,164	$	5,158

September 30, December 31,
2017 2016
(In millions)

Unrealized gains on derivative contracts $ 443
$ 624
Deferred receivables consideration 399
540
Customer omnibus receivable 474
521
Financing receivables - net ⁽¹⁾
407
373
Insurance premiums receivable 137
648
Prepaid expenses 248
268
Tax receivables 423
480
Non-trade receivables ⁽²⁾
374
478
Other current assets 179
451
$ 3,084
$ 4,383

⁽¹⁾ The Company provides financing to certain suppliers, primarily Brazilian farmers, to finance a portion of the suppliers’ production costs. The amounts are reported net of allowances of $6$3 million and $7$4 million at September 30, ~~2017~~2022 and December 31, ~~2016,~~2021, respectively. Interest earned on financing receivables of $6$3 million and ~~$18~~$11 million for the three and nine months ended September 30, ~~2017,~~2022, respectively and $5$2 million and ~~$17~~$8 million for the three and nine months ended September 30, ~~2016,~~2021, respectively, is included in interest and investment income in the consolidated statements of earnings.

⁽²⁾Non-trade receivables included ~~$75~~$18 million and ~~$223~~$27 million of reinsurance recoverables as of September 30, ~~2017~~2022 and December 31, ~~2016,~~2021, respectively.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 9.7. Accrued Expenses and Other Payables

The following table sets forth the items in accrued expenses and other payables:


	September 30,		December 31,
	2022		2021
	(In millions)

Unrealized losses on derivative contracts	$	1,727	$	1,950
Accrued compensation	423		445
Income tax payable	211		132
Other taxes payable	141		168


Insurance claims payable	229		220
Contract liability	423		581


Other accruals and payables	1,532		1,294
	$	4,686	$	4,790

September 30, December 31,
2017 2016
(In millions)

Unrealized losses on derivative contracts $ 564
$ 651
Reinsurance premiums payable 104
479
Insurance claims payables 260
373
Deferred income 570
1,065
Other accruals and payable 1,050
1,414
$ 2,548
$ 3,982

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 10.~~	~~Debt and Financing Arrangements~~

Note 8. Debt and Financing Arrangements

On ~~September 14, 2017,~~February 28, 2022, the Company issued ~~$500~~its first sustainability bond of $750 million aggregate principal amount of ~~3.75%~~2.900% notes due ~~in 2047. Proceeds~~March 1, 2032. Net proceeds before expenses were ~~$493~~$748 million. The Company expects to apply an amount equal to the net proceeds to finance or refinance eligible green projects and/or eligible social projects.

OnDuring the quarter ended September ~~29, 2017,~~30, 2022, the Company redeemed ~~$559~~€500 million aggregate principal amount of ~~5.45% notes~~Fixed-to-Floating Rate Senior Notes due 2022 issued in a private placement on March ~~15, 2018 and incurred~~25, 2021.

On September 29, 2022, Archer Daniels Midland Singapore, Pte. Ltd., a wholly-owned subsidiary of the Company, closed on a $500 million revolving credit facility at an ~~early extinguishment charge~~interest rate of ~~$11 million~~SOFR plus 45 basis points. The facility will be used to finance working capital requirements of ADM entities in the ~~quarter ended~~Asia Pacific region and general corporate purposes.

At September 30, ~~2017.~~

At ~~September 30, 2017~~,2022, the fair value of the Company’s long-term debt ~~exceeded~~was below the carrying value by ~~$1.1~~$0.3 billion,, as estimated using quoted market prices (a Level 2 measurement under applicable accounting standards).

At September 30, ~~2017~~,2022, the Company had lines of credit, including the accounts receivable securitization programs described below, totaling ~~$6.9~~$12.2 billion,, of which ~~$4.8~~$10.1 billion was unused. Of the Company’s total lines of credit, ~~$4.0~~$5.0 billion ~~support a~~ supported the combined U.S. and European commercial paper borrowing ~~facility,~~programs, against which there was ~~$0.6 billion of~~no commercial paper outstanding at September 30, ~~2017~~.2022.

The Company has accounts receivable securitization programs (the “Programs”). The Programs provide the Company with up to ~~$1.7~~$2.6 billion in funding resulting from the sale of accounts ~~receivable. As~~receivable with $0.6 billion unused capacity as of September 30, ~~2017, the Company utilized~~ ~~$1.4 billion~~ ~~of its facility under the Programs~~2022 (see Note 1614 for more information onabout the Programs).


~~Note 11.~~	~~Income Taxes~~

Note 9. Income Taxes

The Company’s effective tax ~~rate~~rates were 15.7% and 16.9% for the three and nine months ended September 30, ~~2017 was 13.3% and 24.0%,~~2022, respectively, compared to ~~28.3%~~18.4% and ~~27.7%~~15.8% for the three and nine months ended September 30, ~~2016,~~2021, respectively. The change in the ~~rates~~rate was primarily due to changes in the geographic mix of earnings and the impact of ~~changes in~~ discrete tax ~~items,~~items.

On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 (“Inflation Act”), which includes, among other provisions, changes to the U.S. corporate income tax system, including a 15% minimum tax based on “adjusted financial statement income,” and a one percent excise tax on net repurchases of stock for tax years beginning after December 31, 2022. While the ~~favorable resolution~~Inflation Act has no immediate impact and is not expected to have a material adverse effect on ADM’s results of ~~an uncertain tax position related~~operations going forward, the Company will continue to ~~a 2014 acquisition and return~~evaluate its impact as further information becomes available.

Archer-Daniels-Midland Company

Notes to provision in the current quarter, partially offset by changes in the forecasted geographic mix of pre-tax earnings and the expiration of U.S. tax credits, including the biodiesel credit, at the end of 2016.Consolidated Financial Statements (Continued)

(Unaudited)

Note 9. Income Taxes (Continued)

The Company is subject to income taxation and routine ~~examination by domestic and foreign tax authorities~~examinations in many jurisdictions around the world and frequently faces challenges regarding the amount of taxes due. These challenges include positions taken by the Company related to the timing, nature, and amount of deductions and the allocation of income among various tax jurisdictions. In its routine evaluations of the exposure associated with various tax filing positions, the Company recognizes a liability, when necessary, for estimated potential tax owed by the Company in accordance with applicable accounting standards. Resolution of the related tax positions, through ~~negotiation~~negotiations with relevant tax authorities or through litigation, may take years to complete. Therefore, it is difficult to predict the timing for resolution of tax ~~positions. In its routine evaluations of the exposure associated with various tax filing~~ positions ~~the Company recognizes a liability, when necessary, for estimated potential additional tax owed by the Company in accordance with the applicable accounting standard. However,~~and the Company cannot predict or provide assurance as to the ultimate outcome of these ongoing or future examinations.

~~The Company’s wholly-owned subsidiary, ADM do Brasil Ltda. (ADM do Brasil), has received~~ ~~three~~ ~~separate~~ However, the Company does not anticipate that the total amount of unrecognized tax ~~assessments from~~benefits will increase or decrease significantly in the ~~Brazilian Federal Revenue Service(BFRS)challenging~~next twelve months. Given the long periods of time involved in resolving tax ~~deductibility of commodity hedging losses and related expenses for~~positions, the ~~tax years 2004, 2006, and 2007. As of~~ ~~September 30, 2017, these assessments, updated for estimated penalties, interest, and variation in currency exchange rates, totaled approximately~~ ~~$490 million. The statute of limitations for tax years 2005 and 2008 to 2011 has expired. The~~ Company does not expect ~~to receive any additional~~that the recognition of unrecognized tax ~~assessments.~~

ADM do Brasil enters into commodity hedging transactions that can result in gains, which are included in ADM do Brasil’s calculations of taxable income in Brazil, and losses, which ADM do Brasil deducts from its taxable income in Brazil. The Company has evaluated its tax position regarding these hedging transactions and concluded, based upon advice from Brazilian legal counsel, that it was appropriate to recognize both gains and losses resulting from hedging transactions when determining its Brazilianbenefits will have a material impact on the Company’s effective income tax ~~expense. Therefore, the Company has continued to recognize the tax benefit from hedging losses~~rate in ~~its financial statements and has not recorded~~ any ~~tax liability for the amounts assessed by the BFRS.~~given period.

A~~rcher-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~

~~Note 11. Income Taxes (Continued)~~

ADM do Brasil filed an administrative appeal for each of the assessments. The appeal panel found in favor of the BFRS on these assessments and ADM do Brasil filed a second level administrative appeal. The second administrative appeal panel continues to conduct customary procedural activities, including ongoing dialogue with the BFRS auditor. If ADM do Brasil continues to be unsuccessful in the administrative appellate process, the Company intends to file appeals in the Brazilian federal courts. While the Company believes its consolidated financial statements properly reflect the tax deductibility of these hedging losses, the ultimate resolution of this matter could result in the future recognition of additional payments of, and expense for, income tax and the associated interest and penalties.

The ~~Company intends to vigorously defend its position against the current assessments and any similar assessments that may be issued for years subsequent to 2011.~~

~~The~~ Company’s ~~subsidiaries~~subsidiary in Argentina, ~~have~~ADM Agro SRL (formerly ADM Argentina SA and Alfred C. Toepfer Argentina SRL), received tax assessments challenging transfer prices used to price grain exports ~~totaling~~ ~~$128~~for the tax years 1999 through 2011 and 2014. As of September 30, 2022, these assessments totaled $6 million ~~(inclusive of~~ in tax and up to $29 million in interest ~~and adjusted~~(adjusted for variation in currency exchange rates) ~~for the tax years 2004 through 2010.~~. The Argentine tax authorities ~~have been conducting~~conducted a review of income and other taxes paid by large exporters and processors of cereals and other agricultural commodities resulting in allegations of income tax evasion. ~~While the~~The Company strongly believes that it has complied with all Argentine tax ~~laws, it~~laws. Currently the Company is under audit for fiscal years 2015 to 2017. While the statute of limitations has expired for tax years 2012 and 2013, the Company cannot rule out receiving additional assessments challenging transfer prices used to price grain exports for years subsequent to ~~2010,~~2014, and estimates that these potential assessments ~~would~~could be approximately ~~$213~~$78 million ~~(as of~~ ~~September 30, 2017~~in tax and ~~subject to~~$49 million in interest (adjusted for variation in currency exchange ~~rates)~~rates as of September 30, 2022). The Company believes that it has appropriately evaluated the transactions underlying these assessments, and has concluded, based on Argentine tax law, that its tax position would be sustained, and accordingly, has not recorded a tax liability for these assessments. In accordance with the accounting requirements for uncertain tax positions, the Company has not recorded an uncertain tax liability for this assessment because it has concluded that it is more likely than not to prevail on the matter based upon its technical merits and because the taxing jurisdiction’s process does not provide a mechanism for settling at less than the full amount of the assessment. The Company intends to vigorously defend its position against the current assessments and any similar assessments that may be issued for years subsequent to ~~2010.~~2014.

In ~~accordance with~~2014, the accounting requirements for uncertain tax positions, the Company has not recorded an uncertain tax liability for these assessments because it has concluded that it is more likely than not to prevail on the Brazil and Argentina matters based upon their technical merits and because the taxing jurisdictions’ processes do not provide a mechanism for settling at less than the full amount of the assessment. The Company’s consideration of these tax assessments requires judgments about the application of income tax regulations to specific facts and circumstances. The final outcome of these matters cannot reliably be predicted, may take many years to resolve, and could result in financial impacts of up to the entire amount of these assessments.

~~The~~ Company’s wholly-owned subsidiary in the Netherlands, ADM Europe B.V., ~~has~~ received a tax assessment ~~totaling $106 million~~ from the Netherlands tax authority challenging the transfer pricing aspects of a 2009 business reorganization, which involved two of its subsidiary companies in the Netherlands. ~~The Company has appealed~~As of September 30, 2022, this assessment was $80 million in tax and $28 million in interest (adjusted for variation in currency exchange rates). On April 23, 2020, the ~~assessment~~court issued an unfavorable ruling and ~~carefully evaluated~~in October 2020, assigned a third party expert to establish a valuation. During the ~~underlying transactions~~second quarter of 2021, the third party expert issued a final valuation. On September 30, 2022, the court issued a ruling consistent with the valuation report, and ~~has concluded that~~ the ~~amount of the gain recognized on the reorganization for~~Dutch tax ~~purposes was appropriate. While the Company plans~~authorities have six weeks to ~~vigorously defend its position against the assessment, it has accrued~~file an ~~amount it believes would be the likely outcome of the litigation. The Company’s defense of the judicial appeal~~appeal. Subsequent appeals may take an extended period of time and could result in ~~additional~~ financial impacts of up to the entire amount of ~~this~~the assessment. As of September 30, 2022, the Company has accrued its best estimate of what it believes will be the likely outcome of the litigation.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note ~~12.~~10. Accumulated Other Comprehensive Income ~~(AOCI)~~

The following tables set forth the changes in AOCI by component for the three and nine months ended September 30, ~~2017~~2022 and the reclassifications out of AOCI for the three and nine months ended September 30, ~~2017~~2022 and ~~2016:~~2021:


	Three months ended September 30, 2022
	Foreign Currency Translation Adjustment		Deferred Gain (Loss) on Hedging Activities		Pension Liability Adjustment		Unrealized Gain (Loss) on Investments		Total
	(In millions)
Balance at June 30, 2022	$	(2,212)	$	382	$	(121)	$	(14)	$	(1,965)
Other comprehensive income (loss) before reclassifications	(536)		161		8		—		(367)
Gain (loss) on net investment hedges	318		—		—		—		318
Amounts reclassified from AOCI	—		(118)		—		—		(118)
Tax effect	(74)		(5)		(2)		1		(80)
Net of tax amount	(292)		38		6		1		(247)
Balance at September 30, 2022	$	(2,504)	$	420	$	(115)	$	(13)	$	(2,212)

	Nine months ended September 30, 2022
	Foreign Currency Translation Adjustment		Deferred Gain (Loss) on Hedging Activities		Pension Liability Adjustment		Unrealized Gain (Loss) on Investments		Total
	(In millions)
Balance at December 31, 2021	$	(2,248)	$	225	$	(147)	$	(2)	$	(2,172)
Other comprehensive income (loss) before reclassifications	(844)		611		22		(13)		(224)
Gain (loss) on net investment hedges	777		—		—		—		777
Amounts reclassified from AOCI	—		(366)		23		—		(343)
Tax effect	(189)		(50)		(13)		2		(250)
Net of tax amount	(256)		195		32		(11)		(40)
Balance at September 30, 2022	$	(2,504)	$	420	$	(115)	$	(13)	$	(2,212)

Three months ended September 30, 2017
Foreign Currency Translation Adjustment Deferred Gain (Loss) on Hedging Activities Pension Liability Adjustment Unrealized Gain (Loss) on Investments Total
(In millions)

Balance at June 30, 2017 $ (1,684 ) $ 39
$ (510 ) $ 14
$ (2,141 )
Other comprehensive income (loss) before reclassifications 244
(41 ) 160
6
369
Amounts reclassified from AOCI —
15
14
—
29
Tax effect (40 ) 6
(66 ) —
(100 )
Net current period other comprehensive income 204
(20 ) 108
6
298
Balance at September 30, 2017 $ (1,480 ) $ 19
$ (402 ) $ 20
$ (1,843 )

Nine months ended September 30, 2017
Foreign Currency Translation Adjustment Deferred Gain (Loss) on Hedging Activities Pension Liability Adjustment Unrealized Gain (Loss) on Investments Total
(In millions)

Balance at December 31, 2016 $ (2,102 ) $ 6
$ (521 ) $ 19
$ (2,598 )
Other comprehensive income before reclassifications 626
(10 ) 151
1
768
Amounts reclassified from AOCI —
22
42
—
64
Tax effect (4 ) 1
(74 ) —
(77 )
Net current period other comprehensive income 622
13
119
1
755
Balance at September 30, 2017 $ (1,480 ) $ 19
$ (402 ) $ 20
$ (1,843 )

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note ~~12.~~10. Accumulated Other Comprehensive Income ~~(AOCI)~~ (Continued)


	Amount reclassified from AOCI
	Three months ended September 30,				Nine months ended September 30,				Affected line item in the consolidated statements of earnings
Details about AOCI components	2022		2021		2022		2021
	(In millions)





Deferred loss (gain) on hedging activities
	$	(1)	$	—	$	(1)	$	15	Revenues
	(117)		(122)		(365)		(450)		Cost of products sold


	(118)		(122)		(366)		(435)		Total before tax
	17		29		69		108		Tax
	$	(101)	$	(93)	$	(297)	$	(327)	Net of tax

Pension liability adjustment
Amortization of defined benefit pension items:
Prior service loss (credit)	$	(10)	$	(4)	$	(114)	$	(71)	Other (income) expense-net
Actuarial losses	10		12		137		161		Other (income) expense-net
	—		8		23		90		Total before tax
	—		6		(8)		(20)		Tax
	$	—	$	14	$	15	$	70	Net of tax

The Company’s accounting policy is to release the income tax effects from AOCI when the individual units of account are sold, terminated, or extinguished.

Note 11. Other (Income) Expense - Net

Amount reclassified from AOCI
Three months ended Nine months ended
Details about AOCI components Sep 30
2017 Sep 30
2016 Sep 30
2017 Sep 30
2016 Affected line item in the consolidated statement of earnings
(In millions)

Foreign currency translation adjustment
$ —
$ (2 ) $ —
$ (75 ) Other income/expense
—
—
—
—
Tax
$ —
$ (2 ) $ —
$ (75 ) Net of tax

Deferred loss (gain) on hedging activities
$ 15
$ 37
$ 20
$ 61
Cost of products sold
—
2
—
2
Interest expense
—
3
2
25
Other income/expense
—
9
—
14
Revenues
15
51
22
102
Total before tax
(5 ) (19 ) (8 ) (38 ) Tax
$ 10
$ 32
$ 14
$ 64
Net of tax

Pension liability adjustment
Amortization of defined benefit pension items:
Prior service credit $ (2 ) $ (5 ) $ (8 ) $ (12 ) Selling, general, and administrative expenses
Actuarial losses 16
15
50
44
Selling, general, and administrative expenses
14
10
42
32
Total before tax
(5 ) (4 ) (15 ) (7 ) Tax
$ 9
$ 6
$ 27
$ 25
Net of tax

Unrealized loss on investments
$ —
$ 6
$ —
$ 6
Asset impairment, exit, and restructuring costs
—
—
—
—
Tax
$ —
$ 6
$ —
$ 6
Net of tax

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 13.~~	~~Other (Income) Expense - Net~~

The following table sets forth the items in other (income) expense:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
	(In millions)
Gains on sales of assets	$	(35)	$	(7)	$	(40)	$	(46)
Debt extinguishment charges	—		36		—		36
Pension settlement	—		1		—		83

Other – net	(32)		(10)		(143)		(37)
Other (Income) Expense - Net	$	(67)	$	20	$	(183)	$	36

Three Months Ended Nine Months Ended
September 30, September 30,
2017 2016 2017 2016
(In millions)
(Gains) losses on sales of assets and businesses $ (15 ) $ 7
$ (66 ) $ (117 )
Loss on debt extinguishment 11
—
11
—
Other – net —
(11 ) 42
(21 )
Other (Income) Expense - Net $ (4 ) $ (4 ) $ (13 ) $ (138 )

Gains on sales of assets ~~for~~in the three and nine months ended September 30, ~~2017 included~~2022 and 2021 consisted of gains on sales of certain assets and disposals of individually insignificant assets in the ordinary course of business. Gains on sales of assets and businesses for the nine months ended September 30, 2017 included gains related to the sale of the crop risk services business and disposals of other individually insignificant assets

Debt extinguishment charges in the ordinary course of business, partially offset by an adjustment of the proceeds of the 2015 sale of the cocoa business. Losses on sale of assets for the three months ended September 30, 2016 related principally to a loss on the sale of an investment. Gains on sales of assets and businesses for the nine months ended September 30, 2016 included realized additional consideration related to the sale of the Company’s equity investment in Gruma S.A.B. de C.V. in December 2012, recovery of loss provisions and gain related to the sale of the Company’s Brazilian sugar ethanol facilities, and gain related to the revaluation of the remaining interest to settlement value in conjunction with the acquisition of the remaining interest in Amazon Flavors.

~~Loss on debt extinguishment for~~ the three and nine months ended September 30, ~~2017~~2021 were related to the early redemption of ~~the Company’s $559~~$500 million aggregate principal amount of 2.750% notes due onin March ~~15, 2018.~~2025.

~~Other - net for the nine months ended September 30, 2017 included foreign exchange losses and changes~~Pension settlement in ~~contingent settlement provisions. Other - net for~~ the three and nine months ended September 30, ~~2016~~2021 was related to the purchase of group annuity contracts that irrevocably transferred the future benefit obligations and annuity administration for certain salaried and hourly retirees and terminated vested participants under the Company’s ADM Retirement Plan and ADM Pension Plan for Hourly-Wage Employees to independent third parties.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 11. Other (Income) Expense - Net (Continued)

Other - net in the three and nine months ended September 30, 2022 included the non-service components of net pension benefit income of $7 million and $19 million, respectively, foreign exchange gains from hedge activity, and other income. Other - net in the nine months ended September 30, 2022 also included a $50 million one-time payment from the USDA Biofuel Producer Recovery Program. Other - net in the three and nine months ended September 30, 2021 included the non-service components of net pension benefit income of $1 million and $12 million, respectively, foreign exchange gains from hedge activity, and other income and expense.

Note ~~14.~~12. Segment Information

~~The Company is principally engaged in procuring, transporting, storing, processing, and merchandising agricultural commodities and products.~~ The Company’s operations are organized, managed, and classified into ~~four~~three reportable business segments: ~~Agricultural~~Ag Services ~~Corn Processing,~~and Oilseeds, ~~Processing,~~Carbohydrate Solutions, and ~~Wild Flavors and Specialty Ingredients.~~Nutrition. Each of these segments is organized based upon the nature of products and services offered. The Company’s remaining operations are not reportable segments, as defined by the applicable accounting standard, and are classified as ~~Other.~~Other Business.

The Agricultural Services segment utilizes its extensive global grain elevator and transportation networks, and port operations to buy, store, clean, and transport agricultural commodities, such as oilseeds, corn, wheat, milo, oats, rice, and barley, and resells these commodities primarily as food and feed ingredients and as raw materials for the agricultural processing industry. The Agricultural Services segment includes international agricultural commodities merchandising and handling activities managed through a global trade desk based in Rolle, Switzerland. Agricultural Services’ grain sourcing, handling, and transportation network provides reliable and efficient services to the Company’s customers and agricultural processing operations. Agricultural Services’ transportation network capabilities include barge, ocean-going vessel, truck, rail, and container freight services. The Agricultural Services segment also includes the activities related to structured trade finance, the processing of wheat into wheat flour, and the Company’s share of the results of its Pacificor (formerly Kalama Export Company LLC) joint venture. The Agricultural Services segment also included returns associated with the Company’s 19.8% investment in GrainCorp until its sale in December 2016. In July 2017, the Company completed the acquisition of a 51% controlling interest in Industries Centers, an Israeli company specializing in the import and distribution of agricultural feed products, which is now known as ADM Israel.

A~~rcher-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~


~~Note 14.~~	~~Segment Information (Continued)~~

The Company’s Corn Processing segment is engaged in corn wet milling and dry milling activities, utilizing its asset base primarily located in the central part of the United States with additional facilities in China, Bulgaria, France, Morocco, Spain, and Turkey. The Corn Processing segment converts corn into sweeteners, starches, and bioproducts. Its products include ingredients used in the food and beverage industry including sweeteners, starch, syrup, glucose, and dextrose. Dextrose and starch are used by the Corn Processing segment as feedstocks for its bioproducts operations. By fermentation of dextrose, the Corn Processing segment produces alcohol, amino acids, and other food and animal feed ingredients. Ethyl alcohol is produced by the Company for industrial use as ethanol or as beverage grade. Ethanol, in gasoline, increases octane and is used as an extender and oxygenate. Bioproducts also include essential amino acids such as lysine and threonine used in swine and poultry diets to optimize performance. Corn gluten feed and meal, as well as distillers’ grains, are produced for use as animal feed ingredients. Corn germ, a by-product of the wet milling process, is further processed into vegetable oil and protein meal. The Corn Processing segment also includes activities related to the processing and distribution of formula feeds and animal health and nutrition products. Other Corn Processing products include citric acids and glycols, all of which are used in various food and industrial products. The Corn Processing segment also included the activities of the Company’s Brazilian sugarcane ethanol plant and related operations until the Company completed the sale of these operations in May 2016. This segment also includes the Company’s share of the results of its equity investments in Almidones Mexicanos S.A. and Red Star Yeast Company LLC. In February 2017, the Company acquired Crosswind Industries, Inc., an industry leader in the manufacture of contract and private label pet treats and foods, as well as specialty ingredients, and an 89% controlling interest in Biopolis SL, a leading provider of microbial technology with a strong portfolio of novel food ingredients. In June 2017, the Company completed the acquisition of Chamtor SA, a French producer of wheat-based sweeteners and starches.

The Oilseeds Processing segment includes global activities related to the origination, merchandising, crushing, and further processing of oilseeds such as soybeans and soft seeds (cottonseed, sunflower seed, canola, rapeseed, and flaxseed) into vegetable oils and protein meals. Oilseeds products produced and marketed by the Company include ingredients for the food, feed, energy, and industrial products industries. Crude vegetable oils produced by the segment’s crushing activities are sold “as is” or are further processed by refining, blending, bleaching, and deodorizing into salad oils. Salad oils are sold “as is” or are further processed by hydrogenating and/or interesterifying into margarine, shortening, and other food products. Partially refined oils are used to produce biodiesel or are sold to other manufacturers for use in chemicals, paints, and other industrial products. Oilseed protein meals are principally sold to third parties to be used as ingredients in commercial livestock and poultry feeds. In Europe and South America, the Oilseeds Processing segment includes origination and merchandising activities as adjuncts to its oilseeds processing assets. These activities include a network of grain elevators, port facilities, and transportation assets used to buy, store, clean, and transport grains and oilseeds. The Oilseeds Processing segment is a major supplier of peanuts, tree nuts, and peanut-derived ingredients to both the U.S. and export markets. In North America, cottonseed flour is produced and sold primarily to the pharmaceutical industry and cotton cellulose pulp is manufactured and sold to the chemical, paper, and other industrial markets. The Oilseeds Processing segment also includes the Company’s share of the results of its equity investment in Wilmar International Limited (Wilmar) and its share of the results of its Stratas Foods LLC, Edible Oils Limited, and Olenex joint ventures. During the nine months ended September 30, 2017, the Company acquired additional shares in Wilmar, increasing its ownership interest from 23.2% to 24.9% as of September 30, 2017.

The Wild Flavors and Specialty Ingredients (WFSI) segment engages in the manufacturing, sales, and distribution of specialty products including natural flavor ingredients, flavor systems, natural colors, proteins, emulsifiers, soluble fiber, polyols, hydrocolloids, natural health and nutrition products, and other specialty food and feed ingredients. The WFSI segment also includes the activities related to the procurement, processing, and distribution of edible beans.

Other includes the Company’s remaining operations, primarily its financial business units, related to futures commission and insurance activities. On May 1, 2017, the Company completed the sale of its crop risk services business to Validus Holdings, a global group of insurance and reinsurance companies.

Intersegment sales have been recorded at amounts approximating market. Operating profit for each segment is based on net sales less identifiable operating ~~expenses and specified items.~~expenses. Also included in operating profit for each segment is equity in earnings of affiliates based on the equity method of accounting. Specified items included in total segment operating profit and certain corporate items are not allocated to the Company’s individual business segments because operating performance of each business segment is evaluated by management exclusive of these items. Corporate results principally include ~~the impact of LIFO-related adjustments,~~ unallocated corporate expenses and interest ~~cost~~expense net of ~~investment income,~~interest income. Corporate results also include revaluation gains and losses on cost method investments and the ~~Company’s~~ share of the results of ~~its~~ equity ~~investment~~investments in ~~Compagnie Industrialle et Financiere des Produits Amylaces SA (Luxembourg) (CIP).~~early-stage start-up companies that ADM Ventures has investments in.

For more information about the Company’s business segments, refer to Note 17 of “Notes to Consolidated Financial Statements” included in Item 8, “Financial Statements and Supplementary Data” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 14.~~	~~Segment Information (Continued)~~

Note 12. Segment Information (Continued)


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions)	2022		2021		2022		2021
Gross revenues


Ag Services and Oilseeds	$	20,238	$	16,410	$	61,838	$	51,148
Carbohydrate Solutions	4,070		3,227		12,750		9,132
Nutrition	1,900		1,755		5,921		5,172
Other Business	97		88		305		290
Intersegment elimination	(1,622)		(1,140)		(5,197)		(3,583)
Total gross revenues	$	24,683	$	20,340	$	75,617	$	62,159

Intersegment sales


Ag Services and Oilseeds	$	1,097	$	721	$	3,015	$	2,181
Carbohydrate Solutions	489		361		2,052		1,223
Nutrition	36		58		130		179

Total intersegment sales	$	1,622	$	1,140	$	5,197	$	3,583

Revenues from external customers










Ag Services and Oilseeds
Ag Services	$	12,537	$	9,899	$	38,717	$	32,860
Crushing	3,220		2,842		9,804		8,411
Refined Products and Other	3,384		2,948		10,302		7,696
Total Ag Services and Oilseeds	19,141		15,689		58,823		48,967
Carbohydrate Solutions
Starches and Sweeteners	2,680		1,972		7,697		5,563
Vantage Corn Processors	901		894		3,001		2,346
Total Carbohydrate Solutions	3,581		2,866		10,698		7,909
Nutrition
Human Nutrition	906		808		2,884		2,410
Animal Nutrition	958		889		2,907		2,583
Total Nutrition	1,864		1,697		5,791		4,993

Other Business	97		88		305		290

Total revenues from external customers	$	24,683	$	20,340	$	75,617	$	62,159

Three Months Ended Nine Months Ended
September 30, September 30,
(In millions) 2017 2016 2017 2016
Gross revenues
Agricultural Services $ 7,022
$ 7,953
$ 21,351
$ 22,486
Corn Processing 2,517
2,630
7,318
7,570
Oilseeds Processing 6,797
6,498
20,109
19,418
Wild Flavors and Specialty Ingredients 586
614
1,809
1,893
Other 98
95
293
314
Intersegment elimination (2,193 ) (1,958 ) (6,122 ) (5,836 )
Total gross revenues $ 14,827
$ 15,832
$ 44,758
$ 45,845

Intersegment sales

Agricultural Services $ 947
$ 993
$ 2,622
$ 2,659
Corn Processing 192
239
475
620
Oilseeds Processing 1,045
723
3,003
2,547
Wild Flavors and Specialty Ingredients 9
3
22
10
Total intersegment sales $ 2,193
$ 1,958
$ 6,122
$ 5,836

Revenues from external customers

Agricultural Services
Merchandising and Handling $ 5,265
$ 6,146
$ 16,434
$ 17,331
Milling and Other 757
754
2,141
2,325
Transportation 53
60
154
171
Total Agricultural Services 6,075
6,960
18,729
19,827
Corn Processing
Sweeteners and Starches 1,087
1,057
3,192
3,061
Bioproducts 1,238
1,334
3,651
3,889
Total Corn Processing 2,325
2,391
6,843
6,950
Oilseeds Processing
Crushing and Origination 3,665
3,660
10,850
10,799
Refining, Packaging, Biodiesel, and Other 2,025
2,042
6,064
5,852
Asia 62
73
192
220
Total Oilseeds Processing 5,752
5,775
17,106
16,871

Wild Flavors and Specialty Ingredients 577
611
1,787
1,883
Total Wild Flavors and Specialty Ingredients 577
611
1,787
1,883

Other - Financial 98
95
293
314
Total Other 98
95
293
314
Total revenues from external customers $ 14,827
$ 15,832
$ 44,758
$ 45,845

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)


~~Note 14.~~	Note 12. Segment Information (Continued)

Three Months Ended Nine Months Ended
September 30, September 30,
(In millions) 2017 2016 2017 2016
Segment operating profit
Agricultural Services $ 87
$ 195
284
328
Corn Processing 253
214
648
506
Oilseeds Processing 119
145
639
641
Wild Flavors and Specialty Ingredients 61
73
228
237
Other 21
23
78
84
Specified Items:
Gains (losses) on sales of assets and businesses⁽¹⁾
12
(4 ) 20
114
Impairment, restructuring, settlement charges⁽²⁾
(63 ) (4 ) (98 ) (16 )
Hedge timing effects⁽³⁾
(5 ) 3
4
4
Total segment operating profit 485
645
1,803
1,898
Corporate (260 ) (165 ) (737 ) (705 )
Earnings before income taxes $ 225
$ 480
$ 1,066
$ 1,193


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions)	2022		2021		2022		2021
Segment operating profit


Ag Services and Oilseeds	$	1,075	$	618	$	3,202	$	1,965
Carbohydrate Solutions	309		213		1,099		855
Nutrition	177		176		605		531
Other Business	18		(5)		78		10
Specified Items:
Gains on sales of assets and businesses(1)	29		—		30		22
Impairment, restructuring, and settlement charges(2)	(49)		(2)		(76)		(133)

Total segment operating profit	1,559		1,000		4,938		3,250
Corporate	(329)		(347)		(918)		(948)

Earnings before income taxes	$	1,230	$	653	$	4,020	$	2,302

⁽¹⁾ ~~Current quarter gain related to disposals~~Consists of individually insignificant assets in the ordinary course of business Current year to date gain related to the sale of the crop risk services business and disposals of other individually insignificant assets in the ordinary course of business, partially offset by an adjustment of the proceeds of the 2015 sale of the cocoa business. Prior quarter loss related principally to a lossgains on the sale of an investment. Prior year to date gain primarily related to recovery of loss provisions and gain related to the sale of the Company’s Brazilian sugar ethanol facilities, realized contingent consideration on the December 2012 sale of the Company’s equity investmentcertain assets in ~~Gruma S.A. de C.V., and revaluation of the remaining interest to settlement value in conjunction with the acquisition of the remaining interest in Amazon Flavors.~~all periods presented.

⁽²⁾Current quarter and ~~year~~year-to-date charges related primarily to ~~date~~the impairment of certain assets, restructuring, and a contingency/settlement. Prior quarter charges ~~consisted of asset impairments~~were related to ~~the reconfiguration of the Company’s Peoria, Illinois ethanol complex in the Corn processing segment and several individually insignificant asset impairments and restructuring charges.~~restructuring. Prior ~~quarter and YTD~~year-to-date charges ~~primarily~~were related to the impairment of certain long-lived assets, restructuring, and ~~restructuring charges.~~a contingency/settlement.

⁽³⁾ ~~Hedge timing effects relate to hedge ineffectiveness associated with documented hedge programs.~~

Note ~~15.~~13. Asset Impairment, Exit, and Restructuring Costs

Asset impairment, exit, and restructuring costs in the ~~quarter~~three months ended September 30, ~~2017~~2022 consisted of ~~$107 million included $63~~$16 million of ~~asset~~ impairments ~~principally in the Corn Processing segment~~ related to ~~the reconfiguration of the Peoria, Illinois ethanol complex due to the Company’s decision to focus on the more profitable high grade industrial~~certain long-lived assets and ~~beverage alcohol as well as export fuel. The impaired assets were determined to have no alternative use with zero net salvage value. Other costs in the current quarter included $44~~$12 million of restructuring charges, ~~related to the reduction of certain positions~~presented as specified items within ~~the Company’s global workforce.~~segment operating profit. Asset impairment, exit, and restructuring costs in the nine months ended September 30, ~~2017 of $140 million~~2022 consisted of ~~$63~~$20 million of ~~asset~~ impairments ~~in the Corn processing segment primarily~~ related to ~~the reconfiguration of the Company’s Peoria, Illinois ethanol complex, $47~~certain long-lived assets and $12 million of restructuring charges, ~~in Corporate primarily related to the reduction of certain positions~~presented as specified items within ~~the Company’s global workforce,~~segment operating profit, and ~~$30~~$2 million of ~~several individually insignificant asset impairments and~~ restructuring ~~charges.~~adjustment in Corporate.

Asset impairment, exit, and restructuring costs in the ~~quarter~~three months ended September 30, ~~2016~~2021 consisted of $6$2 million of ~~other-than-temporary impairment~~restructuring charges, ~~on available for sale equity security investments in Corporate and $5 million of several individually insignificant asset impairments and restructuring charges.~~presented as a specified item within segment operating profit. Asset impairment, exit, and restructuring costs in the nine months ended September 30, ~~2016~~2021 consisted of ~~$17~~$54 million of ~~software impairment~~impairments related to certain long-lived assets and ~~other-than-temporary impairment charges on available for sale equity security investments in Corporate, $5~~$26 million of ~~asset impairments in the Corn Processing~~restructuring charges, presented as specified items within segment operating profit, and ~~$14~~$4 million of ~~other individually insignificant asset impairments and~~ restructuring ~~charges.~~charges in Corporate.

~~Archer-Daniels-Midland Company~~

~~Notes to Consolidated Financial Statements (Continued)~~

~~(Unaudited)~~

Note ~~16.~~14. Sale of Accounts Receivable

~~Since March 2012, the~~The Company has ~~had~~ an accounts receivable securitization program (the ~~“Program”~~“First Program”) with certain commercial paper conduit purchasers and committed purchasers (collectively, the ~~“Purchasers”~~“First Purchasers”). Under the First Program, certain U.S.-originated trade accounts receivable are sold to a wholly-owned bankruptcy-remote entity, ADM Receivables, LLC (“ADM Receivables”). ADM Receivables ~~in turn~~ transfers ~~such~~certain of the purchased accounts receivable to each of the First Purchasers together with a security interest in ~~their entirety to~~all of its right, title, and interest in the ~~Purchasers pursuant to a receivables purchase agreement.~~remaining purchased accounts receivable. In exchange, ~~for the transfer of the accounts receivable,~~ ADM Receivables receives a cash payment of up to ~~$1.2~~$1.8 billion ~~and an additional amount upon the collection of~~ for the accounts receivable ~~(deferred consideration).~~transferred. The First Program terminates on ~~June 22, 2018,~~November 18, 2022, unless extended.

~~In March 2014, the~~The Company ~~entered into a second~~also has an accounts receivable securitization program (the “Second Program”) with certain commercial paper conduit purchasers and committed purchasers (collectively, the “Second Purchasers”). Under the Second Program, certain non-U.S.-originated trade accounts receivable are sold to a wholly-owned bankruptcy-remote entity, ADM Ireland Receivables Company ~~(“ADM~~(ADM Ireland ~~Receivables”)~~Receivables). ADM Ireland Receivables ~~in turn~~ transfers ~~such~~certain of the purchased accounts receivable ~~in their entirety~~ to each of the Second Purchasers ~~pursuant to~~together with a ~~receivables purchase agreement.~~security interest in all of its right, title, and interest in the remaining purchased accounts receivable. In exchange, ~~for the transfer of the accounts receivable,~~ ADM Ireland Receivables receives a cash payment of up to ~~$0.5~~$0.8 billion ~~as amended, and an additional amount upon the collection of~~(€0.8 billion) for the accounts ~~receivable (deferred consideration).~~receivables transferred. The Second Program terminates on ~~March~~February 16, ~~2018,~~2023, unless extended.

Archer-Daniels-Midland Company

Notes to Consolidated Financial Statements (Continued)

(Unaudited)

Note 14. Sale of Accounts Receivable (Continued)

Under the ~~Program~~First and Second ~~Program~~Programs (collectively, the “Programs”), ADM Receivables and ADM Ireland Receivables use the cash proceeds from the transfer of receivables to the First Purchasers and Second Purchasers (collectively, the “Purchasers”) and other consideration, as applicable, to finance the purchase of receivables from the Company and the ADM subsidiaries originating the receivables.

The Company accounts for these transfers as sales. The Company ~~has no retained interests in~~acts as a servicer for the transferred ~~receivables, other than collection and administrative responsibilities and its right to the deferred consideration.~~receivables. At September 30, ~~2017~~2022 and December 31, ~~2016~~,2021, the Company did not record a servicing asset or liability related to its retained responsibility, based on its assessment of the servicing fee, market values for similar transactions, and its cost of servicing the receivables sold.

As of September 30, ~~2017~~2022 and December 31, ~~2016,~~2021, the fair value of trade receivables transferred to the ~~Purchasers and Second~~ Purchasers under the Programs and derecognized from the Company’s consolidated balance ~~sheet~~sheets was ~~$1.8~~$2.0 billion and ~~$1.6~~$2.2 billion, respectively. ~~In exchange~~Total receivables sold were $42.9 billion and $36.7 billion for the ~~transfer as of~~ nine months ended September 30, ~~2017~~2022 and ~~December 31, 2016, the Company received cash of~~ ~~$1.4 billion~~ ~~and $1.0 billion and recorded a receivable for deferred consideration included in other current assets of~~ ~~$399 million~~ ~~and $540 million,~~2021, respectively. Cash collections from customers on receivables sold were ~~$24.3~~$42.1 billion and ~~$24.4~~$34.2 billion for the nine months ended September 30, ~~2017~~2022 and ~~2016~~,2021, respectively. ~~Of this amount, $24.3~~As of September 30, 2022 and December 31, 2021, receivables pledged as collateral to the Purchasers were $1.3 billion and ~~$23.9~~$0.5 billion, ~~pertain to cash collections on the deferred consideration for the nine months ended September 30, 2017 and~~ ~~2016~~, respectively. Deferred consideration is paid to the Company in cash on behalf of the Purchasers as receivables are collected; however, as this is a revolving facility, cash collected from the Company’s customers is reinvested by the Purchasers daily in new receivable purchases under the Program.

The Company’s risk of loss following the transfer of accounts receivable under the Program is limited to the deferred consideration outstanding. The Company carries the deferred consideration at fair value determined by calculating the expected amount of cash to be received and is principally based on observable inputs (a Level 2 measurement under the applicable accounting standards) consisting mainly of the face amount of the receivables adjusted for anticipated credit losses and discounted at the appropriate market rate. Payment of deferred consideration is not subject to significant risks other than delinquencies and credit losses on accounts receivable transferred under the Programs which have historically been insignificant.

Transfers of receivables under the Programs resulted in an expense for the loss on sale of $2$4 million ~~during~~and $12 million for the three ~~months ended September 30, 2017~~ and ~~2016, and $7 million and $4 million for the~~ nine months ended September 30, ~~2017~~2022, respectively, and ~~2016,~~$2 million and $8 million for the three and nine months ended September 30, 2021, respectively, which is classified as selling, general, and administrative expenses in the consolidated statements of earnings.

~~The Company reflects all~~All cash flows ~~related to~~under the Programs are classified as operating activities ~~in its consolidated statement of cash flows for the nine months ended September 30, 2017 and~~ ~~2016~~ because the cash received from the ~~Purchasers and Second~~ Purchasers upon both the sale and collection of the receivables is not subject to ~~significantly different risks~~significant interest rate risk given the short-term nature of the Company’s trade receivables.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Company Overview

This MD&A should be read in conjunction with the accompanying unaudited consolidated financial statements.

~~The Company~~ADM is ~~principally engaged~~a global leader in ~~procuring, transporting, storing,~~human and animal nutrition and one of the world’s premier agricultural origination and processing companies. It is one of the world’s leading producers of ingredients for human and ~~merchandising agricultural commodities~~animal nutrition, and ~~products.~~other products made from nature. The Company uses its significant global asset base to originate and transport agricultural commodities, connecting to markets in ~~163~~200 countries. The Company also processes corn, oilseeds, and wheat into products for food, animal feed, ~~chemical~~industrial, and energy uses. The Company also engages in the manufacturing, sale, and distribution of specialty products including natural flavor ingredients, flavor systems, natural colors, proteins, emulsifiers, soluble fiber, polyols, hydrocolloids, natural health and nutrition products, and other specialty food and feed ingredients. The Company uses its global asset network, business acumen, and its relationships with suppliers and customers to efficiently connect the harvest to the home thereby generating returns for ~~its~~our shareholders, principally from margins earned on these activities.

The Company’s operations are organized, managed, and classified into ~~four~~three reportable business segments: ~~Agricultural~~Ag Services ~~Corn Processing,~~and Oilseeds, ~~Processing,~~Carbohydrate Solutions, and ~~Wild Flavors and Specialty Ingredients.~~Nutrition. Each of these segments is organized based upon the nature of products and services offered. The Company’s remaining operations are not reportable business segments, as defined by the applicable accounting standard, and are classified as ~~Other. See~~Other Business. Financial information with respect to the Company’s reportable business segments is set forth in Note 1412 of “Notes to Consolidated Financial Statements” included in Item 1 herein, “Financial Statements” ~~for more information about the Company’s business segments.~~.

~~The Company’s~~ADM’s recent significant portfolio actions and announcements include:

•the acquisition in February ~~2017~~2022 of ~~Crosswind Industries, Inc., an industry leader~~Comhan, a leading South African flavor distributor;

•the announcement in April 2022 of a growth investment in the ~~manufacture of contract and private label pet treats and foods, as well as specialty ingredients;~~

~~the acquisition in February 2017 of an 89% controlling interest in Biopolis SL, a leading provider of microbial technology with a strong portfolio of novel food ingredients;~~

~~the construction of a new feed-premix~~Company’s oilseed facility in ~~Xiangtan, China,~~Mainz, Germany, which is expected to be completed in ~~2019;~~the third quarter of 2023;

•the ~~sale~~announcement in ~~May 2017 of the Company's crop risk services business to Validus Holdings, a global group of insurance and reinsurance companies;~~

~~the completion in May 2017~~April 2022 of a ~~series of major enhancements at~~$300 million investment in Decatur, Illinois to expand alternative protein production and the ~~Company’s export terminal in Santos, in the Brazilian state of Sao Paulo;~~

~~the construction~~opening of a new, ~~flour mill in Mendota, Illinois,~~state-of-the-art protein innovation center, which is expected to be completed in ~~2019;~~the first quarter of 2025;

•the ~~expansion~~announcement in April 2022 of a ~~Golden Peanut and Tree Nuts~~commitment to achieve 100% deforestation-free supply chains by 2025, five years earlier than previously targeted;

•the announcement in May 2022 to significantly expand starch production at the Company’s Marshall, Minnesota facility, ~~in Blakely, Georgia,~~ which is expected to be completed in ~~2018;~~the second half of 2023;

•the ~~completion~~announcement in May 2022 of five projects funded with support from ADM, in partnership with the U.S. Department of Agriculture’s Natural Resources Conservation Service, to provide farmers with technical and financial resources to help plant cover crop on half a million acres;

•the announcement in June 2022 of the signing of a memorandum of understanding with Bayer, a global enterprise with core competencies in the life science fields of healthcare and agriculture, to build and implement a sustainable crop protection model to soybean farmers in India;

•the announcement in July 2022 of the signing of an agreement with Farmers Business Network (FBN) to expand availability of FBN’s leading-edge digital farm business management platform, Gradable, to ADM’s network of farmers across North America, offering 55,000 growers a comprehensive digital solution to manage their businesses and measure sustainable production data;

•the announcement in August 2022 of the official inauguration of ScaleUp Bio, a joint venture with Nurasa (formerly Asia Sustainable Foods Platform), a company focused on accelerating the commercialization of sustainable foods in Asia. ScaleUp Bio is the first company in Singapore to provide contract development and manufacturing organization services for precision fermentation for food applications;

•the announcement in August 2022 of a long-term strategic partnership with Benson Hill, Inc., a food tech company unlocking the natural genetic diversity of plants, to scale innovative high-protein soy ingredients that will help meet the rapidly growing demand for plant-based proteins;

•the announcement in August 2022 of the launch of two joint ventures, GreenWise Lactic and LG Chem Illinois Biochem, with LG Chem, a leading global diversified chemical company, for the U.S. production of lactic acid and polylactic acid to meet growing demand for a wide variety of plant-based products, including bioplastics;

•the announcement in August 2022 of a strategic partnership with New Culture, a pioneering animal-free dairy company, to accelerate the development and commercialization of alternative dairy products;

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

•the opening in September 2022 of the Company’s first Science and Technology Center in China that will leverage its unparalleled research and development, technology, and product innovation capabilities to spur high-quality development in the nutrition and health industry and meet growing and evolving needs in China and Asia Pacific;

•the announcement in September 2022 of a seven-and-a-half-year strategic commercial agreement with PepsiCo to collaborate closely on projects that aim to significantly expand regenerative agriculture across their shared North American supply chains; and

•the opening in September 2022 of a new ~~silo located on the Danube River~~extrusion facility in ~~Silistra, Bulgaria;~~Serbia that will further expand ADM’s footprint in Europe, extending its production of non-GMO textured soy to include vital origination and extrusion capabilities.

~~the acquisition~~

Sustainability is a key driver in ~~June 2017~~ADM’s expanding portfolio of ~~Chamtor, a French producer of wheat-based sweeteners~~environmentally responsible, plant-derived products. Consumers today increasingly expect their food and ~~starches;~~drink to come from sustainable ingredients, produced by companies that share their values, and ADM is continually finding new ways to meet those needs through its portfolio actions.

the acquisition in July 2017 of a 51% controlling interest in Industries Centers, an Israeli company specializing in the import and distribution of agricultural feed products, which will now be known as ADM Israel; and

~~the modernization of the flour mill in Enid, Oklahoma, which is expected to be completed in 2018.~~

~~As part of the implementation~~The current phase of the Company’s strategic ~~plan,~~transformation is focused on two strategic pillars: Productivity and Innovation.

The Productivity pillar includes (1) advancing the roles of the Company’s Centers of Excellence in procurement, supply chain, and operations to deliver additional efficiencies across the enterprise; (2) continued roll out of the 1ADM business transformation program and implementation of improved standardized business processes; and (3) increased use of technology, analytics, and automation at production facilities, in offices, and with customers.

Innovation activities include expansions and investments in (1) improving the customer experience, including leveraging producer relationships and enhancing the use of state-of-the-art digital technology to help customers grow; (2) sustainability-driven innovation, which encompasses the full range of products, solutions, capabilities, and commitments to serve customers’ needs; and (3) growth initiatives, including organic growth to support additional capacity and meet growing demand, and targeted mergers and acquisitions.

ADM will support both pillars with investments in science and technology, which include expanding digital capabilities and investing further in product research and development. All of these efforts will continue to be strengthened by the Company’s ongoing commitment to Readiness.

Environmental and Social Responsibility

The Company’s policy to protect forests, biodiversity, and communities includes provisions that promote conservation of water resources and biodiversity in agricultural landscapes, promote solutions to reduce climate change and greenhouse gas emissions, and support agriculture as a means to advance sustainable development by reducing poverty and increasing food security. Additionally, the policy confirms ADM’s commitment to protect human rights defenders, whistleblowers, complainants, and community spokespersons; ADM’s aspiration to cooperate with all parties necessary to enable access to fair and just remediation; and the Company’s non-compliance protocol for suppliers. By the end of 2022, the Company ~~continues~~expects to ~~evaluate the capital intensity~~achieve full traceability of its ~~operations~~direct and ~~portfolio, seeking ways~~indirect sourcing throughout its soy supply chains in Brazil, Paraguay, and Argentina. ADM aims to eliminate deforestation from all of the Company’s supply chains by 2025.

In 2020, ADM announced its environmental stewardship goals, collectively called “Strive 35” – an ambitious plan to, by 2035, reduce absolute Scope 1 and 2 greenhouse gas (GHG) emissions by 25 percent from a 2019 baseline, reduce energy intensity by 15 percent, reduce water intensity by 10 percent, and achieve a 90 percent landfill diversion rate.

In 2021, ADM added 5-year interim targets to ensure the Company stays on track to meet its 2035 goals. By 2025, the Company aims to reduce absolute GHG emissions by 1.5%, reduce energy and ~~redeploy capital in~~water intensity by 6% and 5%, respectively, and achieve 87% of its ~~efforts~~waste diverted from landfill.

In 2021, the Company announced its Scope 3 GHG reduction goal, focused upon the five most material Scope 3 categories for the Company; purchased goods and services; fuel and energy related emissions; upstream transportation and distribution; waste; and processing of solid products/goods. ADM aims to ~~drive long-term returns.~~reduce its absolute Scope 3 emissions by 25% from a 2019 baseline by 2035.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Operating Performance Indicators

The Company is exposed to certain risks inherent to an agricultural-based commodity business. These risks are further described in Part I Item 1A, “Risk Factors” included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2021 and in Part II Item 1A “Risk Factors” on page 56.

The Company’s ~~agricultural services~~Ag Services and ~~oilseeds processing~~Oilseeds operations are principally agricultural commodity-based businesses where changes in

selling prices move in relationship to changes in prices of the commodity-based agricultural raw materials. ~~Therefore,~~As a result, changes in agricultural commodity prices have relatively equal impacts on both revenues and cost of products sold. ~~Thus,~~Therefore, changes in revenues of these businesses do not necessarily correspond to ~~the~~ changes in margins or gross profit. Thus, gross margins per volume or metric ton are more meaningful than gross margins as percentage of revenues.

The Company’s ~~corn processing~~Carbohydrate Solutions operations and ~~Wild Flavors and Specialty Ingredients~~Nutrition businesses also utilize agricultural commodities (or products derived from agricultural commodities) as raw materials. However, in these operations, agricultural commodity market price changes do not necessarily ~~equal~~correlate to changes in cost of products sold. ~~Thus,~~Therefore, changes in revenues of these businesses may correspond to changes in margins or gross profit. Thus, gross margin rates are more meaningful as a performance indicator in these businesses.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

The Company has consolidated subsidiaries in 76more than 70 countries. For the majority of the Company’s subsidiaries located outside the United States, the local currency is the functional currency except for certain significant subsidiaries in Switzerland where Euro is the functional currency, and Brazil and Argentina where U.S. dollar is the functional currency. Revenues and expenses denominated in foreign currencies are translated into U.S. dollars at the weighted average exchange rates for the applicable periods. For the majority of the Company’s business activities in Brazil and Argentina, the functional currency is the U.S. dollar; however, certain transactions, including taxes, occur in local currency and require ~~conversion~~remeasurement to the functional currency. Changes in revenues are expected to be correlated to changes in expenses reported by the Company caused by fluctuations in the exchange rates of foreign currencies, primarily the Euro, British pound, Canadian dollar, and Brazilian real, as compared to the U.S. dollar. Effective April 1, 2022, the Company changed the functional currency of its Turkish entities to the U.S. dollar which did not and is not expected to have a material impact on the Company’s consolidated financial statements.

The Company measures its performance using key financial metrics including net earnings, gross margins, constant currency revenue and operating profit, segment operating profit, adjusted segment operating profit, earnings before interest, taxes, depreciation, and amortization (EBITDA), adjusted EBITDA, manufacturing expenses, selling, general, and administrative expenses, return on invested capital, ~~EBITDA,~~ economic value added, ~~manufacturing expenses,~~ and ~~selling, general,~~operating cash flows before working capital. Some of these metrics are not defined by accounting principles generally accepted in the United States and ~~administrative expenses.~~should be considered in addition to, and not in lieu of, GAAP financial measures. For more information, see “Non-GAAP Financial Measures” on pages 43 and 50. The Company’s financial results can vary significantly due to changes in factors such as fluctuations in energy prices, weather conditions, crop plantings, government programs and policies, trade policies, changes in global demand, general global economic conditions, changes in standards of living, ~~and~~ global production of similar and competitive ~~crops.~~crops, and geopolitical developments. Due to the unpredictable nature of these ~~unpredictable~~and other factors, the Company undertakes no responsibility for updating any forward-looking information contained within “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Operations in Ukraine and Russia

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

On February 24, 2022, Russian troops invaded Ukraine. While the Company’s Ukraine and Russian operations have historically represented less than 0.1% of consolidated revenues, the direct and indirect impacts of the ongoing military action could negatively affect ADM’s future operating results. The conflict in Ukraine has created disruptions in global supply chains and has created dislocations of key agricultural commodities. The indirect impact of these dislocations on the Company’s operating results will be a function of a number of variables including supply and demand responses from the rest of the world as well as the length of the conflict and the condition of the agricultural industry and export infrastructure after the conflict ends. For more information, refer to Part II, Item 1A, “Risk Factors”.

As of September 30, 2022, ADM’s assets in Ukraine consisted primarily of current assets that were less than 1% of the Company’s total current assets and an immaterial amount of non-current assets. Of the total current assets in Ukraine, 58% were inventories that represented 1% of ADM’s total inventories.

Market Factors Influencing Operations or Results in the Three Months Ended September 30, ~~2017~~2022

~~As an agricultural commodity-based business, the~~The Company is subject to a variety of market factors which affect the Company's operating results. ~~Agricultural~~In Ag Services and Oilseeds, the unprecedented market volatility, higher energy prices, inflationary pressures, and supply chain challenges continued along the entire value chain. The conflict in Ukraine continued to have an impact on global commodity flows and prices. Global Trade results were driven by market disconnects, opening of the Black Sea grain corridor, supply distortions, and strong destination marketing results. In South America, a more timely crop saw farmer selling return to historic norms and a tight global supply drove commodity prices higher while crush margins suffered from unprecedented farmer selling in Argentina. North American origination was positively impacted by ~~weak~~soybean demand shifting back to the U.S. ~~grain~~, partially offset by lower river levels which resulted in lower export ~~competitiveness. Overall low~~volumes towards the end of the quarter. Crushing margins continued to benefit from strong protein and renewable diesel demand despite market ~~prices~~volatility. In Refined Products and ~~price volatility continued due to a surplus of grains and oilseeds in the global market. In Corn Processing,~~Other, margins were driven by strong oil demand and ~~prices~~elevated oil values. Biodiesel sales benefited from margin appreciation driven by volatile energy markets. In Carbohydrate Solutions, demand for ~~sweeteners~~starches and ~~starches~~sweeteners remained solid with margins remaining steady across the entire portfolio. Production and logistics issues in North America resulted in tightness in the market. Ethanol demand for domestic gasoline was lower, in part due to high gas prices, while ~~co-product prices were stable. Ethanol continues to face a challenging environment. Although ethanol~~export demand remained ~~strong both in North America and export markets due~~strong. Industry ethanol inventories were elevated compared to favorable gasoline blending economics and ethanol's continuing status as a competitive octane enhancer, U.S. industry ethanol production also remained at high levels, limiting margins. Global oilseeds processing volumes remained strong but competition from Argentine exports significantly decreasedthe prior year. Corn milling margins especially in Europe. Slow selling by farmers in Brazil lowered volumes and pressured grain origination and soy crushing margins. While demand and margins for refined oil remained solid across all regions, the uncertainty surrounding the biodiesel tax credit has negatively impacted biodiesel margins. Wild Flavors and Specialty Ingredients benefited from strong co-product results, as prices for oil and feed products rose in line with higher underlying corn prices. Nutrition benefited from overall strong demand in various food, beverage, and dietary supplement categories. In Human Nutrition, demand for ~~flavor ingredients and~~flavors, flavor systems, specialty proteins, bioactives, and fibers was strong, but ~~continued~~increased energy, transportation, and raw material costs, and a strong U.S. dollar adversely impacted results. In Animal Nutrition, amino acids margins were pressured due to becompetition returning to market and production cost inflation. Results were also adversely affected by ~~start-up costs~~the devaluation of certain currencies and ~~margin pressure~~weak demand in ~~certain non-flavor food~~other product lines with some premix and additives customers cutting products out of formulation due to increased ingredient, ~~markets.~~freight, and energy costs. Increased competition in Latin America also contributed to the weak demand in that region. ADM’s productivity initiatives are improving the Company’s capabilities to help mitigate the impact of inflation.

Three Months Ended September 30, ~~2017~~2022 Compared to Three Months Ended September 30, ~~2016~~2021

Net earnings attributable to controlling interests ~~was $192 million in the third quarter of 2017 compared~~increased $0.5 billion from $0.5 billion to ~~$341 million in the third quarter of 2016.~~$1.0 billion. Segment operating profit ~~was $485 million in the third quarter of 2017 compared~~increased $0.6 billion from $1.0 billion to ~~$645 million in the third quarter of 2016. Included in segment operating profit in the current quarter was~~$1.6 billion and included a net charge of ~~$56~~$20 million consisting of charges totaling $49 million related to the impairment of certain assets, restructuring, and a ~~net gain~~contingency/settlement, partially offset by gains on ~~sales~~the sale of certain assets ~~impairment and restructuring charges, and corn hedge timing effects.~~of $29 million. Included in segment operating profit in the prior year quarter was a net charge of $5$2 million consisting of ~~a loss on sale of an investment, impairment and~~ restructuring ~~charges, and corn hedge timing effects.~~charges. Adjusted segment operating profit ~~decreased $109~~(a non-GAAP measure) increased $0.6 billion to $1.6 billion due primarily to higher results in all businesses except in Vantage Corn Processors and Animal Nutrition. Corporate results in the current quarter were a net charge of $329 million and included a mark-to-market gain of $8 million on the conversion option of the exchangeable bonds issued in August 2020. Corporate results in the prior year quarter were a net charge of $347 million and included early debt retirement charges of $36 million, a mark-to-market gain of $7 million on the conversion option of the exchangeable bonds issued in August 2020, expenses related to an acquisition of $3 million, and a pension settlement charge of $1 million.

Income tax expense increased $73 million to $541 million due to the lack of competitiveness of U.S. grains in the global markets, compressed global crush margins, risk management losses, and start-up costs. Corporate results were a charge of $260 million this quarter compared to $165 million in last year’s quarter. Corporate results this quarter included an immaterial charge from the effect of changing agricultural commodity prices on LIFO inventory valuation reserves, compared to a credit of $85 million in the third quarter of 2016.

~~Income taxes decreased $106 million to $30 million due to lower earnings before income taxes and a lower effective tax rate.~~$193 million. The ~~Company’s~~ effective tax rate for the quarter ended September 30, ~~2017 decreased to 13.3%~~2022 was 15.7% compared to ~~28.3%~~18.4% for the quarter ended September 30, ~~2016,~~2021. The decreased rate was driven primarily due to the impact of changes in discrete tax items, including the favorable resolution of an uncertain tax position related to a 2014 acquisition and return to provision in the current quarter, partially offset by changes in the ~~forecasted~~ geographic mix of ~~pre-tax~~pretax earnings, ~~and~~partially offset by the ~~expiration~~impact of ~~U.S.~~discrete tax ~~credits, including the biodiesel credit, at the end of 2016.~~items.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Analysis of Statements of Earnings

Processed volumes by product for the quarter are as follows (in metric tons):


	Three Months Ended					Three Months Ended
	September 30,					September 30,
(In thousands)	2017	2016	Change		(In thousands)	2022	2021	Change
Oilseeds	8,265	8,388	(123	)	Oilseeds	7,688	8,509	(821)
Corn	5,621	5,794	(173	)	Corn	4,381	5,051	(670)
Total	13,886	14,182	(296	)	Total	12,069	13,560	(1,491)

Revenues by segment for the quarter are as follows:


	Three Months Ended
	September 30,
	2022		2021		Change
	(In millions)












Ag Services and Oilseeds
Ag Services	$	12,537	$	9,899	$	2,638
Crushing	3,220		2,842		378
Refined Products and Other	3,384		2,948		436
Total Ag Services and Oilseeds	19,141		15,689		3,452

Carbohydrate Solutions
Starches and Sweeteners	2,680		1,972		708
Vantage Corn Processors	901		894		7
Total Carbohydrate Solutions	3,581		2,866		715

Nutrition
Human Nutrition	906		808		98
Animal Nutrition	958		889		69
Total Nutrition	1,864		1,697		167

Other Business	97		88		9

Total	$	24,683	$	20,340	$	4,343

Three Months Ended
September 30,
2017 2016 Change
(In millions)
Agricultural Services
Merchandising and Handling $ 5,265
$ 6,146
$ (881 )
Milling and Other 757
754
3
Transportation 53
60
(7 )
Total Agricultural Services 6,075
6,960
(885 )

Corn Processing

Sweeteners and Starches 1,087
1,057
30
Bioproducts 1,238
1,334
(96 )
Total Corn Processing 2,325
2,391
(66 )

Oilseeds Processing

Crushing and Origination 3,665
3,660
5
Refining, Packaging, Biodiesel, and Other 2,025
2,042
(17 )
Asia 62
73
(11 )
Total Oilseeds Processing 5,752
5,775
(23 )

Wild Flavors and Specialty Ingredients 577
611
(34 )
Total Wild Flavors and Specialty Ingredients 577
611
(34 )

Other - Financial 98
95
3
Total Other 98
95
3
Total $ 14,827
$ 15,832
$ (1,005 )


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Revenues and cost of products sold in a commodity merchandising and processing business are ~~affected by~~significantly correlated to the underlying commodity prices and volumes. During periods of significant changes in commodity prices, the underlying performance of the Company is better evaluated by looking at margins ~~since~~because both revenues and cost of products sold, particularly in ~~Oilseeds Processing~~Ag Services and ~~Agricultural Services,~~Oilseeds, generally have a relatively equal impact from ~~commodity~~market price changes, which generally result in an insignificant impact to gross profit.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Revenues ~~decreased $1.0~~increased $4.3 billion to ~~$14.8~~$24.7 billion due to higher sales prices ($3.7 billion) and higher sales volumes ($0.6 billion). Higher sales prices of corn, oils and soybeans and higher sales volumes of corn and milled rice were partially offset by lower sales volumes ~~($0.9 billion)~~of oils and wheat and lower ~~average selling~~sales prices ~~($0.1 billion). The decrease in sales volumes was due principally~~of canola seed. Ag Services and Oilseeds revenues increased 22% to ~~a decrease in volumes of unprocessed commodities, in particular volumes of soybeans, corn, and rapeseed. Agricultural Services revenues decreased 13% to $6.1~~$19.1 billion due to ~~lower~~higher sales prices ($2.8 billion) and higher sales volumes ($~~0.8 billion) and lower average selling prices ($0.1~~0.6 billion). ~~Corn Processing~~Carbohydrate Solutions revenues ~~decreased 3%~~increased 25% to ~~$2.3~~$3.6 billion due to ~~lower~~higher sales ~~volumes~~prices ($~~0.1~~0.7 billion). ~~Oilseeds Processing~~Nutrition revenues ~~of $5.8~~increased 10% to $1.9 billion ~~and Wild Flavors and Specialty Ingredients revenues of $0.6 billion were in line with the prior year’s quarter.~~due to higher sales prices ($0.2 billion).

Cost of products sold ~~decreased $0.7~~increased $3.9 billion to ~~$14.0~~$22.9 billion due principally to ~~lower sales volumes. Included in~~higher average commodity costs and higher manufacturing expenses. Manufacturing expenses increased $0.2 billion to $1.8 billion due principally to higher energy costs, higher maintenance expenses, and increased operating supplies.

Foreign currency translation decreased revenues and cost of products sold during this quarter was an immaterial charge from the effect of changing agricultural commodity prices on LIFO inventory valuation reserves compared to a credit of $85 million in the prior year’s quarter. Manufacturing expenses of $1.3by $1.0 billion ~~in the current quarter was in line with the prior year’s quarter.~~and $0.9 billion, respectively.

Gross profit ~~decreased $0.3~~increased $0.5 billion or 37%, to ~~$0.8 billion. The decrease~~$1.8 billion due principally to higher results in ~~gross profit consisted principally of~~Ag Services and Oilseeds ($354 million), Starches and Sweeteners ($177 million), and Human Nutrition ($12 million), partially offset by lower results in ~~merchandising~~Vantage Corn Processors ($42 million), Animal Nutrition ($6 million), and ~~handling~~Other ($~~72 million), soybean and canola processing ($64 million) and biodiesel ($51 million) in Oilseeds Processing, partially offset by higher results in sweeteners and starches ($18~~4 million). These factors are explained in the segment operating profit discussion on page 38. Current period gross profit included an immaterial charge from the effect of changing agricultural commodity prices on LIFO inventory valuation reserves compared to a credit of $85 million during the same period last year.42.

Selling, general, and administrative expenses ~~decreased $68 million~~increased $0.1 billion to ~~$478 million~~$0.8 billion due ~~principally~~primarily to ~~prior period~~higher IT and project-related expenses, ~~related to a settled legal matter~~increased provisions for bad debt, amortization of intangibles from new acquisitions, and ~~lower pension expense in the current quarter.~~higher salaries and benefit costs.

Asset impairment, exit, and restructuring ~~charges~~costs increased ~~$96~~$26 million to ~~$107~~$28 million. ~~Current period charges~~Charges in the current quarter consisted of ~~$63~~$16 million of ~~asset~~ impairments ~~primarily~~ related to ~~the reconfiguration of the Company’s Peoria, Illinois ethanol complex in the Corn Processing segment~~certain long-lived assets and ~~$44~~$12 million of restructuring charges, ~~related to~~presented as specified items within segment operating profit. Charges in the ~~reduction~~prior year quarter consisted of ~~certain positions within the Company’s global workforce. Prior period charges included $6~~$2 million of ~~other-than-temporary impairment~~restructuring charges, ~~on two available for sale equity security investments in Corporate and $5 million of several individually insignificant asset impairments and restructuring charges.~~presented as a specified item within segment operating profit.

~~Interest expense increased $1 million to $79 million due principally to higher interest rates on short-term debt and the issuance of the $1 billion fixed-rate notes in August 2016.~~

Equity in earnings of unconsolidated affiliates increased ~~from a loss of $2~~$100 million to ~~income of $46~~$210 million due primarily ~~due~~ to higher earnings from the Company’s investment in Wilmar ~~resulting from the~~and Almidones Mexicanos S.A.

Interest and investment income increased ~~ownership stake in and~~$65 million to $85 million due primarily to higher ~~results from Wilmar,~~interest income, partially offset by ~~lower results from~~revaluation gains of $9 million in the prior year quarter.

Interest expense increased $36 million to $97 million due to higher debt balances and increased short-term rates on the Company’s ~~equity investment~~U.S. and European commercial paper borrowing programs. Interest expense in ~~CIP.~~the current quarter also included a $8 million mark-to-market gain adjustment related to the conversion option of the exchangeable bonds issued in August 2020, compared to a $7 million mark-to-market gain adjustment in the prior year quarter.

Other income-net increased from a net expense of $20 million in the prior year quarter to net income of ~~$4 million was comparable to~~$67 million. Income in the ~~prior period. Current period income~~current quarter included gains ~~related to~~on disposals of individually insignificant assets in the ordinary course of business, ~~partially offset by a charge~~the non-service components of net pension benefit income, and foreign exchange gains. Expense in the prior year quarter included charges of $36 million related to the early redemption of ~~the Company’s $559~~$500 million aggregate principal amount of 2.750% notes due onin March ~~15, 2018. Prior period income included foreign exchange gains~~2025 and other ~~income~~expense, partially offset by ~~a loss~~gains on the sale of ~~an investment.~~certain assets and disposals of individually insignificant assets in the ordinary course of business, the non-service components of net pension benefit income, and foreign exchange gains from hedge activity.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Segment operating profit (loss), adjusted segment operating profit (a non-GAAP measure), and earnings before income taxes for the quarter are as follows:


	Three Months Ended
	September 30,
Segment Operating Profit (Loss)	2022		2021		Change
	(In millions)












Ag Services and Oilseeds
Ag Services	$	292	$	36	$	256
Crushing	346		280		66
Refined Products and Other	295		236		59
Wilmar	142		66		76
Total Ag Services and Oilseeds	1,075		618		457

Carbohydrate Solutions
Starches and Sweeteners	327		178		149
Vantage Corn Processors	(18)		35		(53)
Total Carbohydrate Solutions	309		213		96

Nutrition
Human Nutrition	146		139		7
Animal Nutrition	31		37		(6)
Total Nutrition	177		176		1

Other Business	18		(5)		23

Specified Items:
Gains on sales of assets and businesses	29		—		29
Asset impairment, restructuring, and settlement charges	(49)		(2)		(47)

Total Specified Items	(20)		(2)		(18)

Total Segment Operating Profit	$	1,559	$	1,000	$	559

Adjusted Segment Operating Profit(1)	$	1,579	$	1,002	$	577

Segment Operating Profit	$	1,559	$	1,000	$	559
Corporate	(329)		(347)		18
Earnings Before Income Taxes	$	1,230	$	653	$	577

Three Months Ended
September 30,
Segment Operating Profit 2017 2016 Change
(In millions)
Agricultural Services
Merchandising and Handling $ 20
$ 92
$ (72 )
Milling and Other 53
60
(7 )
Transportation 14
43
(29 )
Total Agricultural Services 87
195
(108 )

Corn Processing

Sweeteners and Starches 202
176
26
Bioproducts 51
38
13
Total Corn Processing 253
214
39

Oilseeds Processing

Crushing and Origination 39
76
(37 )
Refining, Packaging, Biodiesel, and Other 66
119
(53 )
Asia 14
(50 ) 64
Total Oilseeds Processing 119
145
(26 )

Wild Flavors and Specialty Ingredients 61
73
(12 )
Total Wild Flavors and Specialty Ingredients 61
73
(12 )

Other - Financial 21
23
(2 )
Total Other 21
23
(2 )

Specified Items:
Gains (losses) on sales of assets and businesses 12
(4 ) 16
Impairment and restructuring charges (63 ) (4 ) (59 )
Hedge timing effects (5 ) 3
(8 )
Total Specified Items (56 ) (5 ) (51 )

Total Segment Operating Profit $ 485
$ 645
$ (160 )

Adjusted Segment Operating Profit⁽¹⁾
$ 541
$ 650
$ (109 )

Segment Operating Profit $ 485
$ 645
$ (160 )
Corporate (260 ) (165 ) (95 )
Earnings Before Income Taxes $ 225
$ 480
$ (255 )

⁽¹⁾ Adjusted segment operating profit is segment operating profit excluding the above specified items.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

~~Agricultural~~Ag Services ~~operating profit decreased 55%. Merchandising~~ and Handling operating results decreased due to the lack of competitiveness of U.S. grains in the global markets resulting in a significant decrease in margins and lower U.S. grain export volumes. Global Trade generated good results from international origination and destination marketing businesses partially offset by some hedge position losses. Milling and Other results declined due to decreased volumes, mainly in the U.S., while maintaining steady product margins. Transportation results decreased primarily due to low U.S. grain exports and a slower start to harvest in North America resulting in lower barge freight volumes and margins.

~~Corn Processing~~Oilseeds operating profit increased ~~18%~~74%. ~~Sweeteners~~Ag Services results were significantly higher than the third quarter of 2021. The short crops in South America supported U.S. exports, driving improved volumes and ~~Starches operating profit increased due to strong~~ margins in North American origination, which had significant negative impacts from Hurricane Ida in the prior-year quarter. Better margins in global ocean freight, driven by good execution amid dynamic global trade flows, powered better results in Global Trade. South American origination saw improved volumes and margins driven by increased farmer selling in addition to higher volumes through the Company’s export facilities. Crushing results were significantly higher, with margins driven by resilient global demand for both meal and oil. Strong rapeseed margins in Europe, Middle East, and Africa (EMEA), driven by robust oil demand and continued market dislocations, along with positive impacts from an insurance settlement, helped drive improved results. North America ~~while international operations~~soy crush margins continued to ~~provide solid contributions to overall results. Bioproducts~~benefit from renewable diesel demand. Also, net positive timing effects in the quarter were more than the prior-year quarter. Positive results ~~increased with better ethanol margins.~~

Oilseeds Processing operating profit decreased 18%. Crushing and Origination operating profit decreased due to compressed global crush margins amid ample meal supplies, weak canola margins due in part to higher seed costs, increased competition from Argentine meal exports, and weak South America origination margins resulting from continued low commodity prices that reduced the pace of farmer selling forcing higher basis costs. Refining, Packaging, Biodiesel, and Other operating profit declined due to the uncertainty surrounding the biodiesel tax credit that has negatively impacted biodiesel margins. Asia results increased on higher earnings from the Company’s investment in Wilmar due to the increased ownership stake in and higher results from Wilmar.

~~Wild Flavors and Specialty Ingredients operating profit decreased 16%. Weaker results in specialty ingredients, due in part to operational start-up costs,~~ were partially offset by lower crush volumes, including impacts from idled facilities in Ukraine and Paraguay. Refined Products and Other results were higher year-over-year in a strong margin environment for both refined oils and biodiesel. Robust performance in global refined oils was driven by healthy demand and elevated refined oil margins amid supply chain disruptions. Equity earnings from Wilmar were much higher versus the ~~continuing~~third quarter of 2021.

Carbohydrate Solutions operating profit increased 45%. Starches and Sweeteners, which includes ethanol production from the wet mills, delivered much improved year-over-year results amid steady global demand for sweeteners and starches. Corn co-products, including continued robust demand for corn oil, as well as effective risk management, drove higher execution margins in North America. Wheat milling had a strong performance, delivering improved volumes and margins to meet healthy demand for flour. In EMEA, the business delivered solid volumes and margins and managed through a dynamic energy environment to drive stronger results. Vantage Corn Processors results were substantially lower. Ethanol margins were pressured by lower domestic demand and elevated corn costs. In addition, the prior-year quarter’s results included contributions from the now-sold Peoria, Illinois facility.

Nutrition operating profit increased 1%. Human Nutrition results were higher than the third quarter of 2021. Strong demand for plant-based proteins, as well as solid performance in texturants, drove continued growth in Specialty Ingredients. Flavors results were impacted by adverse currency translation effects in EMEA, partially offset by continued strong demand ~~for flavor ingredients~~growth in the region. Demand fulfillment challenges in North America and ~~flavor systems~~lower demand in ~~Africa~~Asia Pacific, driven partly by lockdowns in China, also negatively impacted results. Health and ~~Asia.~~Wellness was lower versus the prior-year quarter, which included higher fermentation income. Animal Nutrition results were down versus the prior-year quarter. Pet results were lower in Latin America on lower volumes, partially offset by strong volumes and margins in North America. Softer animal protein demand affected feed volumes.

Other ~~- Financial~~Business operating profit ~~decreased 9% primarily due to lower results from the~~increased $23 million. Higher short-term interest rates drove improved earnings in ADM Investor Services, partially offset by increased claim settlements in captive insurance ~~operations.~~.

Corporate results for the quarter are as follows:


	Three Months Ended
	September 30,
	2022		2021		Change
	(In millions)

Interest expense-net	$	(76)	$	(66)	$	(10)
Unallocated corporate costs	(251)		(231)		(20)

Expenses related to acquisitions	—		(3)		3
Debt extinguishment charges	—		(36)		36
Gain on debt conversion option	8		7		1
Settlement charges	—		(1)		1
Other expense	(10)		(17)		7
Total Corporate	$	(329)	$	(347)	$	18

Three Months Ended
September 30,
2017 2016 Change
(In millions)
LIFO credit (charge) $ —
$ 85
$ (85 )
Interest expense - net (72 ) (74 ) 2
Unallocated corporate costs (109 ) (106 ) (3 )
Other charges (55 ) (74 ) 19
Minority interest and other (24 ) 4
(28 )
Total Corporate $ (260 ) $ (165 ) $ (95 )

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Corporate results were a net charge of ~~$260 million this quarter compared to $165~~$329 million in ~~last year’s quarter. The effect of changing agricultural commodity prices on LIFO inventory valuation reserves resulted in an immaterial charge this~~the current quarter compared to a ~~credit~~net charge of ~~$85~~$347 million in the prior year quarter. ~~Other~~Interest expense-net increased $10 million due to higher debt balances and increased short-term rates on the Company’s U.S. and European commercial paper borrowing programs. Unallocated corporate costs increased $20 million due primarily to higher performance-related compensation accruals, higher IT operating and project-related costs and higher costs in the Company’s centers of excellence. Acquisition expenses in the prior year quarter were related to the acquisition of a 75% majority stake in U.S.-based PetDine, Pedigree Ovens, the Pound Bakery, and NutraDine. Debt extinguishment charges in the ~~current period included a charge~~prior year quarter were related to the early redemption of ~~the Company’s $559~~$500 million aggregate principal amount of 2.750% notes due in March 2025. Gain on ~~March 15, 2018 and restructuring charges~~debt conversion option was related to the ~~reduction~~mark-to-market adjustment of ~~certain positions within~~ the ~~Company’s global workforce.~~conversion option of the exchangeable bonds issued in August 2020. Other ~~charges~~expense in the current quarter included railroad maintenance expenses of $32 million, partially offset by the non-service components of net pension benefit income of $7 million and foreign exchange gains from hedge activity. Other expense in the prior ~~period~~year quarter included ~~legal settlement costs~~railroad repairs and ~~legal fees, other-than-temporary impairment charges on available for sale equity security investments, a loss on the sale~~maintenance expenses of $31 million, partially offset by an investment ~~and restructuring charges. Minority interest~~revaluation gain of $9 million, the non-service components of net pension benefit income of $1 million, and other ~~expense increased $28 million due principally to lower results from the Company’s equity investment in CIP.~~income.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Non-GAAP Financial Measures

The Company uses adjusted earnings per share (EPS), adjusted ~~earnings before taxes, interest, and depreciation and amortization (EBITDA),~~EBITDA, and adjusted segment operating profit, non-GAAP financial measures as defined by the Securities and Exchange Commission, to evaluate the Company’s financial performance. These performance measures are not defined by accounting principles generally accepted in the United States and should be considered in addition to, and not in lieu of, GAAP financial measures.

Adjusted EPS is defined as diluted EPS adjusted for the effects on reported diluted EPS of ~~certain~~ specified items. Adjusted EBITDA is defined as earnings before ~~taxes,~~ interest, ~~and~~taxes, depreciation, and amortization, adjusted for specified items. The Company calculates adjusted EBITDA by removing the impact of specified items and adding back the amounts of interest expense and depreciation and amortization to earnings before income taxes. Adjusted segment operating profit is segment operating profit adjusted, where applicable, for specified items.

Management believes that adjusted EPS, adjusted EBITDA, and adjusted segment operating profit are useful measures of the Company’s performance because they provide investors additional information about the Company’s operations allowing better evaluation of underlying business performance and better period-to-period comparability. Adjusted EPS, adjusted EBITDA, and adjusted segment operating profit are not intended to replace or be an alternative to diluted EPS, earnings before income taxes, and segment operating profit, respectively, the most directly comparable amounts reported under GAAP.

The table below provides a reconciliation of diluted EPS to adjusted EPS for the three months ended September 30, ~~2017~~2022 and ~~2016.~~2021.


	Three months ended September 30,
	2022				2021
	In millions		Per share		In millions		Per share
Average number of shares outstanding - diluted	563				566

Net earnings and reported EPS (fully diluted)	$	1,031	$	1.83	$	526	$	0.93
Adjustments:
Debt extinguishment charges - net of tax of $9 million (1)	—		—		27		0.05
Gains on sales of assets and businesses - net of tax of $7 million (1)	(22)		(0.04)
Gain on debt conversion option - net of tax of $0 (1)	(8)		(0.01)		(7)		(0.01)
Asset impairment, restructuring, and settlement charges - net of tax of $9 million in 2022 and $0 million in 2021 (1)	40		0.07		3		0.01
Expenses related to acquisitions - net of tax of $1 million (1)	—		—		2		—
Certain discrete tax adjustments	7		0.01		(3)		(0.01)
Total adjustments	17		0.03		22		0.04
Adjusted net earnings and adjusted EPS	$	1,048	$	1.86	$	548	$	0.97

Three months ended September 30,
2017 2016
In millions Per share In millions Per share
Average number of shares outstanding - diluted 569
589

Net earnings and reported EPS (fully diluted) $ 192
$ 0.34
$ 341
$ 0.58
Adjustments:
LIFO charge (credit) - net of tax of $32 million⁽¹⁾
—
—
(53 ) (0.09 )
(Gains) losses on sales of assets and businesses - net of tax of $2 million in 2017 and at 0% in 2016 ⁽²⁾
(10 ) (0.02 ) 9
0.02
Asset impairment, restructuring, and settlement charges - net of tax of $38 million in 2017 and $25 million in 2016⁽²⁾
69
0.12
48
0.08
Loss on debt extinguishment - net of tax of $4 million⁽¹⁾
7
0.01
—
—
Total adjustments 66
0.11
4
0.01
Adjusted net earnings and adjusted EPS $ 258
$ 0.45
$ 345
$ 0.59

⁽¹⁾~~Tax effected using the Company’s U.S. tax rate.~~

⁽²⁾ Tax effected using the U.S. and other applicable tax rates.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The tables below provide a reconciliation of earnings before income taxes to adjusted EBITDA and adjusted EBITDA by segment for the three months ended September 30, ~~2017~~2022 and ~~2016.~~2021.


	Three months ended
	September 30,
(In millions)	2022		2021		Change
Earnings before income taxes	$	1,230	$	653	$	577
Interest expense	97		61		36
Depreciation and amortization	260		247		13
Gains on sales of assets and businesses	(29)		—		(29)
Debt extinguishment charges	—		36		(36)
Expenses related to acquisitions	—		3		(3)
Railroad maintenance expenses	32		31		1
Asset impairment, restructuring, and settlement charges	49		3		46
Adjusted EBITDA	$	1,639	$	1,034	$	605


	Three months ended
	September 30,
(In millions)	2022		2021		Change


Ag Services and Oilseeds	$	1,166	$	711	$	455
Carbohydrate Solutions	391		297		94
Nutrition	242		230		12
Other Business	35		(3)		38
Corporate	(195)		(201)		6
Adjusted EBITDA	$	1,639	$	1,034	$	605

Three months ended September 30,
(In millions) 2017 2016 Change
Earnings before income taxes $ 225
$ 480
$ (255 )
Interest expense 79
78
1
Depreciation and amortization 232
225
7
LIFO —
(85 ) 85
(Gains) losses on sales of assets and businesses (12 ) 9
(21 )
Loss on debt extinguishment 11
—
11
Asset impairment, restructuring, and settlement charges 107
73
34
Adjusted EBITDA $ 642
$ 780
$ (138 )

Three months ended September 30,
(In millions) 2017 2016 Change
Agricultural Services $ 138
$ 245
$ (107 )
Corn Processing 338
306
32
Oilseeds Processing 171
194 (23 )
Wild Flavors and Specialty Ingredients 85
95
(10 )
Other - Financial 26
26
—
Corporate (116 ) (86 ) (30 )
Adjusted EBITDA $ 642
$ 780
$ (138 )

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Market Factors Influencing Operations or Results in the Nine Months Ended September 30, ~~2017~~2022

~~As an agricultural commodity-based business, the~~The Company is subject to a variety of market factors which affect the Company's operating results. In ~~Agricultural~~Ag Services ~~U.S. export competitiveness was~~and Oilseeds, strong ~~during the first half of the year but weakened during the third quarter. Overall low market volatility~~global demand continued due to ~~surplus~~a short crop in ~~the~~South America. The conflict in Ukraine resulted in even tighter global ~~market. In Corn Processing,~~stocks of commodities and created high volatility which had a positive impact on North and South American origination prices. Global Trade results were driven by market disconnects, tight supply, strong destination marketing margins, and firm ocean freight rates. North American origination was negatively impacted by weather-related supply disruption and delayed planting and lower river levels. Crushing margins continued to benefit from strong protein and renewable diesel demand and tight oilseeds stocks. In Refined Products and Other, margins were driven by strong oil demand and tight supply with volatile energy markets driving up biodiesel margins. In Carbohydrate Solutions, demand for starches and sweeteners was solid with margins remaining steady despite higher input costs. Ethanol demand for domestic gasoline was lower, in part due to high gas prices, ~~for sweeteners and starches remained solid in North America~~ while ~~co-product prices were stable. Ethanol continues to face a challenging environment. Although ethanol~~export demand remained strong, ~~both in North America and export markets due to~~driven by favorable ~~gasoline~~ blending economics and ethanol's continuing status as a competitive octane enhancer, U.S. industry ethanol production also remained at high levels limiting margins. Global oilseeds processing volumes remained strong, although slower meal demand growth pressuredgovernment incentives. Corn milling margins due to meal exports from Argentina and ample supply of competing proteins. Slow selling by farmers in Brazil continues to depress grain origination margins despite strong export volumes. While demand and margins for refined oil remained solid across all regions, the uncertainty surrounding the biodiesel tax credit has negatively impacted biodiesel margins. Wild Flavors and Specialty Ingredients benefited from strong co-product results, as prices for oil and feed products rose in line with higher underlying corn prices. Corn costs were volatile and higher, in part due to a relatively low projected corn stocks-to-use ratio and uncertainty caused by the conflict in Ukraine. Nutrition benefited from overall strong demand in various food, beverage, and dietary supplement categories. In Human Nutrition, demand for ~~flavor ingredients and~~flavors, flavor systems, specialty proteins, bioactives, and fibers was strong, but ~~continued to be adversely affected by start-up~~higher energy, transportation, and raw material costs, and ~~margin pressure~~a strong U.S. dollar adversely impacted results. In Animal Nutrition, amino acids pricing and margins improved due to a tighter global supply environment, partially offset by the devaluation of certain currencies and weak demand in ~~certain non-flavor food~~other product lines with some premix and additives customers cutting products out of formulation due to increased ingredient, ~~markets.~~freight, and energy costs. Increased competition in Latin America also contributed to the weak demand in that region. ADM’s productivity initiatives are improving the Company’s capabilities to help mitigate the impact of inflation.

Nine Months Ended September 30, ~~2017~~2022 Compared to Nine Months Ended September 30, ~~2016~~2021

Net earnings attributable to controlling interests ~~decreased $48 million~~increased $1.4 billion to ~~$807 million.~~$3.3 billion. Segment operating profit ~~was $1.8~~increased $1.7 billion ~~in the current period compared~~ to ~~$1.9~~$4.9 billion ~~in the prior period. Included in segment operating profit in the current period was~~and included a net charge of ~~$74~~$46 million consisting of ~~a net gain on sales~~charges totaling $76 million related to the impairment of certain assets, ~~and businesses, impairment,~~ restructuring, and a contingency/settlement, ~~charges, and corn hedge timing effects.~~partially offset by gains on the sale of certain assets of $30 million. Included in segment operating profit in the prior period was ~~income~~a net charge of ~~$102~~$111 million consisting of ~~a net gain~~asset impairment, restructuring, and settlement charges of $133 million, partially offset by gains on ~~sales~~the sale of certain assets ~~and businesses/revaluation, impairment and restructuring charges, and corn hedge timing effects.~~of $22 million. Adjusted segment operating profit (a non-GAAP measure) increased ~~$0.1~~$1.6 billion to ~~$1.9~~$5.0 billion due primarily to ~~solid~~higher results in all businesses except in Vantage Corn ~~Processing, partially offset by weaker South American origination margins, lower soybean crush margins, and weaker~~Processors. Corporate results in ~~some specialty ingredients.~~the current and prior periods were a net charge of $0.9 billion. Corporate results ~~were~~in the current period included a mark-to-market gain of $12 million on the conversion option of the exchangeable bonds issued in August 2020. Corporate results in the prior period included a pension settlement charge of ~~$737~~$83 million, ~~for the nine months compared to $705~~early debt retirement charges of $36 million, ~~the same period last year. Corporate results for the nine months included~~ a ~~credit of $4 million from the effect of increasing agricultural commodity prices on LIFO inventory valuation reserves, compared to a charge~~mark-to-market gain of $17 million on the ~~same period last year.~~conversion option of the exchangeable bonds issued in August 2020, expenses related to an acquisition of $3 million, and a restructuring charge of $4 million.

Income taxes ~~decreased $75~~of $679 million ~~due to lower earnings before income taxes and a lower effective tax rate.~~increased $315 million. The Company’s effective tax rate for the nine months ended September 30, ~~2017 decreased to 24.0%~~2022 was 16.9% compared to ~~27.7%~~15.8% for the nine months ended September 30, ~~2016,~~2021. The change in the rate was due primarily ~~due~~ to changes in the geographic mix of pretax earnings and the impact of ~~changes in~~ discrete tax items, including the favorable resolution of an uncertain tax position related to a 2014 acquisition and return to provision in the current period, partially offset by changes in the forecasted geographic mix of pre-tax earnings and the expiration of U.S. tax credits, including the biodiesel credit, at the end of 2016.items.

Analysis of Statements of Earnings

Processed volumes by product for the nine months ended September 30, 2022 and 2021 are as follows (in metric tons):


	Nine Months Ended
	September 30,
(In thousands)	2022	2021	Change
Oilseeds	24,387	26,247	(1,860)
Corn	13,969	13,743	226
Total	38,356	39,990	(1,634)

Nine Months Ended
September 30,
(In thousands) 2017 2016 Change
Oilseeds 25,602
25,137
465
Corn 16,851
16,623
228
Total 42,453
41,760
693

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The Company generally operates its production facilities, on an overall basis, at or near capacity, adjusting facilities individually, as needed, to react to the current margin environment and seasonal local supply and demand conditions. ~~Processed~~The overall decrease in oilseeds processed volumes ~~of oilseeds increased~~was primarily related to decreased crush rates resulting from the decline in global demand for rapeseed and the decline in canola crop due to the ~~strong demand environment for soybean meal~~drought condition in North America, a temporarily idled facility in Paraguay due to crop failure, and ~~canola oil.~~the indefinite shutdown of a Ukraine facility since February 2022. The overall increase in corn ~~is due~~processed volumes was primarily related to ~~the strong demand environment for ethanol,~~two dry mill facilities that were idled since April 2020 and restarted in April 2021, partially offset by the ~~production disruption in one~~sale of the ~~Company’s plants due to a water pipe leak in the first quarter and the reconfiguration of the Company’s~~ Peoria, Illinois ~~ethanol complex.~~facility in November 2021 and logistical challenges surrounding railcar availability since the second quarter of 2022.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Revenues by segment for the nine months ended nine months ended September 30, 2022 and 2021 are as follows:

Nine Months Ended
September 30,
2017 2016 Change
(In millions)
Agricultural Services

Merchandising and Handling $ 16,434
$ 17,331
$ (897 )
Milling and Other 2,141
2,325
(184 )
Transportation 154
171
(17 )
Total Agricultural Services 18,729
19,827
(1,098 )

Corn Processing

Sweeteners and Starches 3,192
3,061
131
Bioproducts 3,651
3,889
(238 )
Total Corn Processing 6,843
6,950
(107 )

Oilseeds Processing
Crushing and Origination 10,850
10,799
51
Refining, Packaging, Biodiesel, and Other 6,064
5,852
212
Asia 192
220
(28 )
Total Oilseeds Processing 17,106
16,871
235

Wild Flavors and Specialty Ingredients 1,787
1,883
(96 )
Total Wild Flavors and Specialty Ingredients 1,787
1,883
(96 )

Other - Financial 293
314
(21 )
Total Other 293
314
(21 )
Total $ 44,758
$ 45,845
$ (1,087 )


	Nine Months Ended
	September 30,
	2022		2021		Change
	(In millions)












Ag Services and Oilseeds
Ag Services	$	38,717	$	32,860	$	5,857
Crushing	9,804		8,411		1,393
Refined Products and Other	10,302		7,696		2,606
Total Ag Services and Oilseeds	58,823		48,967		9,856

Carbohydrate Solutions
Starches and Sweeteners	7,697		5,563		2,134
Vantage Corn Processors	3,001		2,346		655
Total Carbohydrate Solutions	10,698		7,909		2,789

Nutrition
Human Nutrition	2,884		2,410		474
Animal Nutrition	2,907		2,583		324
Total Nutrition	5,791		4,993		798

Other Business	305		290		15
Total	$	75,617	$	62,159	$	13,458

Revenues and cost of products sold in a commodity merchandising and processing business are ~~affected by~~significantly correlated to the underlying commodity prices and volumes. During periods of significant changes in commodity prices, the underlying performance of the Company is better evaluated by looking at margins ~~since~~because both revenues and cost of products sold, particularly in ~~Oilseeds Processing~~Ag Services and ~~Agricultural Services,~~Oilseeds, generally have a relatively equal impact from commodity price changes, which generally result in an insignificant impact to gross profit.

Revenues ~~decreased $1.1~~increased $13.5 billion to ~~$44.8~~$75.6 billion due to ~~lower~~higher sales ~~volumes~~prices ($~~1.1 billion) in Agricultural Services ($1.1 billion), Corn Processing ($0.1 billion), and Wild Flavors and Specialty Ingredients ($0.1~~14.2 billion), partially offset by lower sales volumes ($0.7 billion). Higher sales prices of corn, oils and soybeans, and higher sales volumes inof milled rice, were partially offset by lower sales volumes of soybeans, oils, and wheat. Ag Services and Oilseeds ~~Processing~~revenues increased 20% to $58.8 billion due to higher sales prices ($11.3 billion), partially offset by lower sales volumes ($1.4 billion). Carbohydrate Solutions revenues increased 35% to $10.7 billion due to higher sales prices ($2.3 billion) and higher sales volumes ($0.5 billion) despite the loss of USD-grade industrial alcohol volumes from the divested Peoria, Illinois facility. Nutrition revenues increased 16% to $5.8 billion due to higher sales prices ($0.6 billion) and higher sales volumes ($0.2 billion). ~~The decrease in sales volumes was due principally to a decrease in volumes of unprocessed commodities, in particular volumes of soybeans, corn, rapeseed, and wheat.~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Cost of products sold ~~decreased $1.0~~increased $12.0 billion to ~~$42.2~~$69.8 billion due principally to ~~lower sales volumes. Included in cost of products sold was a credit of $4 million from the effect of increasing agricultural~~higher average commodity ~~prices on LIFO inventory valuation reserves compared to a charge of $17 million in the prior year’s period.~~costs and higher manufacturing expenses. Manufacturing expenses increased ~~$0.1~~$0.7 billion to ~~$3.9~~$5.1 billion due principally to higher energy costs, higher maintenance expenses, increased operating supplies, and higher salaries and ~~benefits~~benefit costs.

Foreign currency translation decreased revenues and ~~increased expenses for energy, operating~~cost of goods sold by $2.1 billion and ~~maintenance supplies, and contracted labor.~~$2.0 billion, respectively.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Gross profit ~~of $2.6~~increased $1.5 billion ~~in the current period was comparable~~or 34% to ~~the prior period. Lower results in soybean processing ($143 million) and grain origination ($67 million) were offset by~~$5.8 billion due principally to higher results in ~~canola processing~~Ag Services and Oilseeds ($~~46 million)~~1.1 billion), ~~sweeteners~~Starches and ~~starches~~Sweeteners ($51280 million), and ~~ethanol~~Nutrition ($75151 million)., partially offset by lower results in Vantage Corn Processors ($120 million) and Other ($27 million) These factors are explained in the segment operating profit discussion on page 45. Current period gross profit included a credit of $4 million from the effect of changing agricultural commodity prices on LIFO inventory valuation reserves compared to a charge of $17 million during the same period last year.49.

Selling, general, and administrative expenses increased $0.3 billion to $2.5 billion due principally to higher IT and project-related expenses, higher insurance costs, increased provisions for bad debt, amortization of ~~$1.5 billion was comparable to the prior period. Current period increase in~~intangibles from new acquisitions, and higher salaries and ~~benefits cost related to increased investments in the Company’s business transformation, IT, and innovation initiatives was offset by prior period expenses related to a settled legal matter.~~benefit costs.

Asset impairment, exit, and restructuring costs ~~increased $104~~decreased $54 million to ~~$140~~$30 million. ~~Current~~Charges in the current period ~~charges~~ consisted of ~~$63~~$20 million of ~~asset~~ impairments related to certain long-lived assets and $12 million of restructuring charges, presented as specified items within segment operating profit, and $2 million of restructuring adjustment in Corporate. Charges in the ~~Corn processing segment primarily~~prior period consisted of $54 million of impairments related to ~~the reconfiguration~~certain long-lived assets and $26 million of ~~the Company’s Peoria, Illinois ethanol complex, $47~~restructuring charges, presented as specified items within segment operating profit, and $4 million of restructuring charges in Corporate primarily related to the reduction of certain positions within the Company’s global workforce, and $30 million of several individually insignificant asset impairments and restructuring charges. Prior period charges included $17 million of software impairment and other-than-temporary impairment charges on available for sale equity security investments in Corporate, $5 million of asset impairments in the Corn Processing segment, and $14 million of other individually insignificant asset impairments and restructuring charges.Corporate.

Interest expense increased $33 million to $246 million due principally to higher interest rates on short-term debt, the issuance of the $1 billion fixed-rate notes in August 2016, and interest related to a prior year foreign income tax amended return, partially offset by the retirement of the $261 million bond that matured in April 2017. Interest expense in the prior period also included a credit of $8 million for the revaluation of the mandatorily redeemable 10% interest in Harvest Innovations.

Equity in earnings of unconsolidated affiliates increased ~~$174~~$208 million to ~~$327~~$606 million due primarily ~~due~~ to higher earnings from the Company’s ~~investment~~investments in Wilmar, ~~resulting from the~~Almidones Mexicanos S.A., Olenex, SoyVen, and Stratas Foods LLC.

Interest and investment income increased ~~ownership stake in and~~$93 million to $176 million due primarily to higher ~~results from Wilmar and improved results from the Company’s equity investment in CIP,~~interest income, partially offset by ~~losses from a new equity investment and decreased earnings resulting from~~lower revaluation gains of $37 million compared to $49 million in the ~~disposal of an equity investment.~~prior period.

~~Other income decreased $125~~Interest expense increased $74 million to ~~$13 million. Current~~$262 million due to higher debt balances and increased short-term rates on the Company’s U.S. and European commercial paper borrowing programs. Interest expense in the current period ~~income~~also included ~~gains~~a $12 million mark-to-market gain adjustment related to the ~~sale~~conversion option of the ~~crop risk services business and~~exchangeable bonds issued in August 2020 compared to a $17 million mark-to-market gain adjustment in the prior period.

Other income-net increased from a net expense of $36 million in the prior period to net income of $183 million. Income in the current period included gains on disposals of ~~other~~ individually insignificant assets in the ordinary course of business, ~~partially offset by an adjustment~~the non-service components of net pension benefit income, a $50 million one-time payment from the ~~proceeds~~USDA Biofuel Producer Recovery Program, foreign exchange gains, and other income. Expense in the prior period included a non-cash pension settlement charge of $83 million related to the ~~2015 sale~~purchase of group annuity contracts that irrevocably transferred the ~~cocoa business, a charge~~future benefit obligations and annuity administration for certain salaried and hourly retirees and terminated vested participants under the ADM Retirement Plan and ADM Pension Plan for Hourly-Wage Employees to independent third parties, charges of $36 million related to the early redemption of ~~the Company’s $559~~$500 million aggregate principal amount of 2.750% notes due onin March ~~15, 2018, foreign exchange losses,~~2025, and changes in contingent settlement provisions. Prior period income included realized additional consideration related to the December 2012 sale of the Company’s equity investment in Gruma S.A.B de C.V., recovery of loss provisions as well as gain related toother expense, partially offset by gains on the sale of certain assets and disposals of individually insignificant assets in the ~~Company’s Brazilian sugar ethanol facilities, gain related to~~ordinary course of business, the ~~revaluation~~non-service components of ~~the remaining interest to settlement value in conjunction with the acquisition of the remaining interest in Amazon Flavors,~~net pension benefit income, and foreign exchange gains ~~and other income.~~from hedge activity.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Segment operating profit, adjusted segment operating profit (a non-GAAP measure), and earnings before income taxes for the nine months ended September 30, 2022 and 2021 are as follows:


	Nine Months Ended
	September 30,
Segment Operating Profit (Loss)	2022		2021		Change
	(In millions)











Ag Services and Oilseeds
Ag Services	$	957	$	435	$	522
Crushing	1,242		812		430
Refined Products and Other	623		467		156
Wilmar	380		251		129
Total Ag Services and Oilseeds	3,202		1,965		1,237

Carbohydrate Solutions
Starches and Sweeteners	1,036		706		330
Vantage Corn Processors	63		149		(86)
Total Carbohydrate Solutions	1,099		855		244

Nutrition
Human Nutrition	470		429		41
Animal Nutrition	135		102		33
Total Nutrition	605		531		74

Other Business	78		10		68

Specified Items:
Gains (losses) on sales of assets and businesses	30		22		8
Asset impairment, restructuring, and settlement charges	(76)		(133)		57

Total Specified Items	(46)		(111)		65

Total Segment Operating Profit	$	4,938	$	3,250	$	1,688

Adjusted Segment Operating Profit(1)	$	4,984	$	3,361	$	1,623

Segment Operating Profit	$	4,938	$	3,250	$	1,688
Corporate	(918)		(948)		30
Earnings Before Income Taxes	$	4,020	$	2,302	$	1,718

Nine Months Ended
September 30,
Segment Operating Profit 2017 2016 Change
(In millions)
Agricultural Services

Merchandising and Handling $ 79
$ 102
$ (23 )
Milling and Other 156
164
(8 )
Transportation 49
62
(13 )
Total Agricultural Services 284
328
(44 )

Corn Processing

Sweeteners and Starches 561
499
62
Bioproducts 87
7
80
Total Corn Processing 648
506
142

Oilseeds Processing
Crushing and Origination 197
331
(134 )
Refining, Packaging, Biodiesel, and Other 208
251
(43 )
Asia 234
59
175
Total Oilseeds Processing 639
641
(2 )

Wild Flavors and Specialty Ingredients 228
237
(9 )
Total Wild Flavors and Specialty Ingredients 228
237
(9 )

Other - Financial 78
84
(6 )
Total Other 78
84
(6 )

Specified Items:
Gains (losses) on sales of assets and businesses 20
114
(94 )
Impairment, restructuring, settlement charges (98 ) (16 ) (82 )
Hedge timing effects 4
4
—
Total Specified Items (74 ) 102
(176 )

Total Segment Operating Profit $ 1,803
$ 1,898
$ (95 )

Adjusted Segment Operating Profit⁽¹⁾
$ 1,877
$ 1,796
$ 81

Segment Operating Profit $ 1,803
$ 1,898
$ (95 )
Corporate (737 ) (705 ) (32 )
Earnings Before Income Taxes $ 1,066
$ 1,193
$ (127 )

⁽¹⁾ Adjusted segment operating profit is segment operating profit excluding the above specified items.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

~~Agricultural~~Ag Services ~~operating profits decreased 13%. Merchandising~~ and Handling operating results decreased due to decreased volumes in the U.S. corn exports and lower export margins. Global Trade generated solid results benefiting from improved margins which was partially offset by some hedge position losses. Milling and Other decreased due to lower volumes and margins. Transportation results decreased due to river conditions and lower barge freight volumes and margins.

~~Corn Processing~~Oilseeds operating profit increased ~~28%~~63%. ~~Sweeteners~~Ag Services results were significantly higher versus the prior period. Global trade results were higher, driven by strong performances in destination marketing and ~~Starches~~global ocean freight. North American origination margins and volumes were lower year-over-year. South America results were higher, driven by better origination margins on good demand for grain. Crushing was higher year over year driven by robust protein and renewable diesel demand. Positive net timing effects in the current period versus negative timing effects in the prior period helped drive higher year-over-year results. Refined Products and Other results were higher than the prior period, driven by higher margins due to strong oils demand. Biodiesel margins also benefited from direct sales compared to the historical auction sales. Equity earnings from Wilmar were higher versus the prior period.

Carbohydrate Solutions operating profit increased ~~due to improved domestic demand~~29%. Starches and ~~higher volumes and margins~~Sweeteners, including ethanol production from the ~~international business. Bioproducts profit increased due to strong~~wet mills, delivered higher results versus the prior period, driven by solid margins across sweeteners and starches and corn co-products, improved ethanol ~~export demand and improved~~ margins, and ~~improved lysine margins, partially offset by~~effective risk management. Sales volumes for starches and sweeteners continued their recovery, and the biosolutions platform continued to deliver revenue growth as demand for plant-based products expanded into more diverse applications. Vantage Corn Processors results were lower ~~volumes caused by a mild winter.~~

~~Oilseeds Processing operating profit was comparable to~~versus the prior ~~period. Crushing and Origination operating profit decreased~~period with the $50 million one-time payment from the USDA Biofuel Producer Recovery Program partially offsetting the prior ~~period. Higher softseed results in North America~~period’s strong positioning gains and Europe were offset by lower crushing and origination results in South America as margins remain challenged. A competitive global protein meal market continued to pressure soybean crush margins in all regions. Refining, Packaging, Biodiesel, and Other operating profit declined due to the uncertainty surrounding the biodiesel tax credit that has negatively impacted biodiesel margins partially offset by higher results in South American refined and packaged oils and the global peanut business. Asia results increased on higher earnings from the Company’s investment in Wilmar due to the increased ownership stake in and higher results from Wilmar.

Wild Flavors and Specialty Ingredients operating profit decreased 4%. Weaker results in specialty ingredients, due in part to operational start-up costs, were partially offset by the continuing strong demand for flavor ingredients and flavor systems especially in Africa and Asia.

Other - Financial operating profit decreased 7% primarily due to the absence of the Company’s share in the earnings of an equity investment that was sold in the third quarter of fiscal 2016 partially offset by improvedindustrial alcohol results from the now-sold Peoria, Illinois facility.

Nutrition operating profit increased 14%. Human Nutrition delivered higher year-over-year results. Flavors results were lower driven by the impact of the strong U.S. dollar in EMEA, softer demand in Asia Pacific, and higher costs in North America. Strong sales growth in alternative proteins, including contribution from the Sojaprotein acquisition, and good demand for texturants offset some higher operating costs to help deliver better year-over-year results in Specialty Ingredients. Health and Wellness was also higher year-over-year, powered by probiotics, including the contribution from the November 2021 Deerland Probiotics and Enzymes acquisition, and robust demand for fiber and Vitamin E. Animal Nutrition profits were higher than the prior period due primarily to strength in amino acids.

Other Business operating profit increased $68 million. Higher short-term interest rates drove improved earnings in ADM Investor Services and improved underwriting performance resulted in better captive insurance ~~operations.~~results.

Corporate results for the nine months ended September 30, 2022 and 2021 are as follows:


	Nine Months Ended
	September 30,
	2022		2021		Change
	(In millions)

Interest expense-net	$	(239)	$	(200)	(39)
Unallocated corporate costs	(727)		(681)		(46)
Loss on sale of assets	(3)		—		(3)
Expenses related to acquisitions	(2)		(3)		1
Debt extinguishment charges	—		(36)		36
Gain on debt conversion option	12		17		(5)
Restructuring and settlement adjustment (charges)	2		(87)		89
Other income	39		42		(3)
Total Corporate	$	(918)	$	(948)	$	30

Nine Months Ended
September 30,
2017 2016 Change
(In millions)
LIFO credit (charge) $ 4
$ (17 ) $ 21
Interest expense - net (232 ) (205 ) (27 )
Unallocated corporate costs (376 ) (325 ) (51 )
Other charges (58 ) (87 ) 29
Minority interest and other (75 ) (71 ) (4 )
Total Corporate $ (737 ) $ (705 ) $ (32 )

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Corporate results were a net charge of ~~$737 million~~$0.9 billion in the current period, ~~compared~~which was comparable to $705 million in the prior period. The effects of increasing commodity prices on LIFO inventory valuations resulted in a credit of $4 million in the current period compared to a charge of $17 million in the prior period. Interest ~~expense - net~~expense-net increased ~~$27~~$39 million due ~~principally~~ to higher ~~interest~~debt balances, increased short-term rates on ~~short-term debt,~~ the ~~issuance of the new $1 billion fixed-rate debt in August 2016,~~Company’s U.S. and European commercial paper borrowing programs, and interest related to a ~~prior year foreign income~~ tax ~~amended return, partially offset by the retirement of the $261 million bond that matured in April 2017.~~item. Unallocated corporate costs increased ~~$51~~$46 million due ~~principally~~primarily to ~~increased investments~~higher IT and project-related costs and higher costs in the Company’s ~~business transformation, IT, and innovation initiatives. Other~~centers of excellence, partially offset by lower incentive compensation accruals. Debt extinguishment charges in the ~~current period included a charge~~prior year quarter were related to the early redemption of ~~the Company’s $559~~$500 million aggregate principal amount of 2.750% notes due in March 2025. Gain on ~~March 15, 2018 and restructuring charges~~debt conversion option was related to the ~~reduction~~mark-to-market adjustment of ~~certain positions within~~ the ~~Company’s global workforce. Other~~conversion option of the exchangeable bonds issued in August 2020. Restructuring and settlement charges in the prior period included ~~legal~~a non-cash pension settlement ~~costs~~charge of $83 million related to the purchase of group annuity contracts that irrevocably transferred the future benefit obligations and ~~legal fees, a software impairment charge, other-than-temporary impairment charges on available~~annuity administration for ~~sale equity security investments, a loss on~~certain salaried and hourly retirees and terminated vested participants under the ~~sale~~ADM Retirement Plant and ADM Pension Plan for Hourly-Wage Employees to independent third parties, and restructuring charges. Other income in the current period included the non-service components of net pension benefit income of $19 million, an investment revaluation gain of $37 million and foreign exchange gains from hedge activity, partially offset by railroad maintenance expenses of $41 million. Other income in the prior period included the non-service components of net pension benefit income of $12 million, an investment revaluation gain of $49 million, and other ~~asset impairment and restructuring charges.~~income, partially offset by railroad maintenance expenses of $34 million.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Non-GAAP Financial Measures

The Company uses adjusted ~~earnings per share (EPS),~~EPS, adjusted ~~earnings before taxes, interest, and depreciation and amortization (EBITDA),~~EBITDA, and adjusted segment operating profit, non-GAAP financial measures as defined by the Securities and Exchange Commission, to evaluate the Company’s financial performance. These performance measures are not defined by accounting principles generally accepted in the United States and should be considered in addition to, and not in lieu of, GAAP financial measures.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

The table below provides a reconciliation of diluted EPS to adjusted EPS for the nine months ended September 30, ~~2017~~2022 and ~~2016.~~2021.


	Nine months ended September 30,
	2022				2021
	In millions		Per share		In millions		Per share
Average number of shares outstanding - diluted	566				566

Net earnings and reported EPS (fully diluted)	$	3,321	$	5.87	$	1,927	$	3.41
Adjustments:
Gains on sales of assets and businesses - net of tax of $7 million in 2022 and $5 million in 2021 (1)	(20)		(0.04)		(17)		(0.03)
Asset impairment, restructuring, and settlement charges - net of tax of $14 million in 2022 and $53 million in 2021 (1)	60		0.10		167		0.30
Expenses related to acquisitions - net of tax of $1 million in 2022 and 2021 (1)	1		—		2		—
Debt extinguishment charges - net of tax of $9 million (1)	—		—		27		0.05
Gain on debt conversion option - net of tax of $0 (1)	(12)		(0.02)		(17)		(0.03)
Certain discrete tax adjustments	2		—		(4)		(0.01)
Total adjustments	31		0.04		158		0.28
Adjusted net earnings and adjusted EPS	$	3,352	$	5.91	$	2,085	$	3.69

Nine months ended September 30,
2017 2016
In millions Per share In millions Per share
Average number of shares outstanding - diluted 574
593

Net earnings and reported EPS (fully diluted) $ 807
$ 1.41
$ 855
$ 1.44
Adjustments:
LIFO charge (credit) - net of tax of $2 million in 2017 and $6 million in 2016 ⁽¹⁾
(2 ) —
11
0.02
(Gains) losses on sales of assets and businesses - net of tax of $32 million in 2017 and $17 million in 2016 ⁽²⁾
12
0.02
(92 ) (0.15 )
Asset impairment, restructuring, and settlement charges - net of tax of $47 million in 2017 and $34 million in 2016 ⁽²⁾
98
0.17
64
0.10
Loss on debt extinguishment - net of tax of $4 million⁽¹⁾
7
0.01
—
—
Certain discrete tax adjustments 4
0.01
—
—
Total adjustments 119
0.21
(17 ) (0.03 )
Adjusted net earnings and adjusted EPS $ 926
$ 1.62
$ 838
$ 1.41

⁽¹⁾Tax effected using the ~~Company’s~~ U.S. ~~tax rate.~~

⁽²⁾ ~~Tax effected using the~~and other applicable tax rates.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

The tables below provide a reconciliation of earnings before income taxes to adjusted EBITDA and adjusted EBITDA by segment for the nine months ended September 30, ~~2017~~2022 and ~~2016.~~2021.


	Nine months ended
	September 30,
(In millions)	2022		2021		Change
Earnings before income taxes	$	4,020	$	2,302	$	1,718
Interest expense	262		188		74
Depreciation and amortization	774		739		35
Gains on sales of assets and businesses	(27)		(22)		(5)
Debt extinguishment charges	—		36		(36)
Expenses related to acquisitions	2		3		(1)
Railroad maintenance expenses	41		34		7
Asset impairment, restructuring, and settlement charges	74		220		(146)
Adjusted EBITDA	$	5,146	$	3,500	$	1,646









	Nine months ended
	September 30,
(In millions)	2022		2021		Change













Ag Services and Oilseeds	$	3,469	$	2,243	$	1,226
Carbohydrate Solutions	1,337		1,106		231






Nutrition	800		692		108






Other Business	103		15		88





Corporate	(563)		(556)		(7)









Adjusted EBITDA	$	5,146	$	3,500	$	1,646

Nine months ended September 30,
(In millions) 2017 2016 Change
Earnings before income taxes $ 1,066
$ 1,193
$ (127 )
Interest expense 246
213
33
Depreciation and amortization 684
677
7
LIFO (4 ) 17
(21 )
(Gains) losses on sales of assets and businesses (20 ) (109 ) 89
Loss on debt extinguishment 11
—
11
Asset impairment, restructuring, and settlement charges 145
98
47
Adjusted EBITDA $ 2,128
$ 2,089
$ 39

Nine months ended September 30,
(In millions) 2017 2016 Change
Agricultural Services $ 434
$ 479
$ (45 )
Corn Processing 918
777
141
Oilseeds Processing 790
788
2
Wild Flavors and Specialty Ingredients 299
304
(5 )
Other - Financial 90
91
(1 )
Corporate (403 ) (350 ) (53 )
Adjusted EBITDA $ 2,128
$ 2,089
$ 39

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

Liquidity and Capital Resources

A Company objective is to have sufficient liquidity, balance sheet strength, and financial flexibility to fund the operating and capital requirements of a ~~capital intensive~~capital-intensive agricultural commodity-based business. The Company’s strategy involves expanding the volume and diversity of crops that it merchandises and processes, expanding the global reach of its core model, and expanding its value-added product portfolio. The Company depends on access to credit markets, which can be impacted by its credit rating and factors outside of ~~the Company’s~~ADM’s control, to fund its working capital needs and capital expenditures. The primary source of funds to finance ~~the Company’s~~ADM’s operations, capital expenditures, and advancement of its growth strategy is cash generated by operations and lines of credit, including a commercial paper borrowing ~~facility.~~facility and accounts receivable securitization programs. In addition, the Company believes it has access to funds from public and private equity and debt capital markets in both U.S. and international markets.

Cash provided by operating activities was $3.3 billion for the nine months ended September 30, 2022 compared to $5.9 billion for the same period last year. Working capital changes decreased cash by $1.3 billion for the nine months ended September 30, 2022 compared to an increase of $2.8 billion for the same period last year. Segregated cash and investments increased approximately $1.5 billion due to increased trading activity in the Company’s futures commission and brokerage business. Trade receivables increased $1.6 billion due to higher revenues. Inventories decreased approximately $0.6 billion due to lower inventory volumes partially offset by higher inventory prices. Other current assets increased $0.9 billion primarily due to increases in contracts and futures gains, margin deposits and grain accounts, and customer omnibus receivable. Brokerage payables increased approximately $1.7 billion due to increased customer trading activity in the Company’s futures commission and brokerage business.

Cash used in investing activities was $0.9 billion for the nine months ended September 30, 2022 compared to $1.3 billion for the same period last year. Capital expenditures for the nine months ended September 30, 2022 were $0.8 billion compared to $0.7 billion for the same period last year. Other-net for the nine months ended September 30, 2022 of $0.1 billion consisted of new and additional cost method equity investments.

Cash used in financing activities was $2.4 billion for the nine months ended September 30, 2022 compared to $1.6 billion for the same period last year. Long-term debt borrowings for the nine months ended September 30, 2022 of $0.8 billion consisted of the $750 million aggregate principal amount of 2.900% notes due 2032, compared to long-term debt borrowings for the same period last year of $1.3 billion which consisted of the $750 million aggregate principal amount of 2.700% Notes due 2051 issued on September 10, 2021 and the €0.5 billion aggregate principal amount of fixed-to-floating rate senior notes due 2022 issued in a private placement on March 25, 2021. The Company expects to apply an amount equal to the proceeds from the borrowings in the current period to finance or refinance eligible green projects and/or eligible social projects. Proceeds from the borrowings in the prior period were used to redeem debt and for general corporate purposes. Long-term debt payments of $0.5 billion for the nine months ended September 30, 2022 consisted of the €0.5 billion aggregate principal amount of fixed-to-floating rate senior notes due 2022 issued in a private placement on March 25, 2021, compared to $0.5 billion for the same period last year which consisted of the early redemption of the $500 million aggregate principal amount of 2.750% notes due 2025 in September 2021. Net payments on short-term credit agreements for the nine months ended September 30, 2022 were $0.8 billion compared to $1.7 billion for the same period last year. Dividends for the nine months ended September 30, 2022 were $0.7 billion compared to $0.6 billion for the same period last year. Share repurchases for the nine months ended September 30, 2022 were $1.2 billion compared to an insignificant amount for the same period last year.

At September 30, ~~2017,~~2022, the Company had ~~$0.8~~$1.1 billion of cash and cash equivalents ~~and short-term marketable securities~~ and a current ratio, defined as current assets divided by current liabilities, of ~~1.6~~1.5 to 1. Included in working capital was ~~$5.3~~$7.6 billion of readily marketable commodity inventories. Cash provided by operating activities was $2.2 billion for the nine months compared to $1.3 billion the same period last year. Working capital changes increased cash by $0.6 billion for the nine months compared to a decrease of $0.3 billion for the same period last year. Trade receivables decreased $0.1 billion due to lower revenues. Inventories decreased approximately $0.7 billion due to lower inventory quantities partially offset by higher prices. Trade payables declined approximately $0.3 billion principally reflecting seasonal cash payments for North American harvest-related grain purchases. Cash used in investing activities was $0.9 billion for the nine months compared to $1.2 billion the same period last year. Sales of marketable securities, net of purchases, were $73 million for the nine months compared to $35 million the same period last year. Capital expenditures and net assets of businesses acquired were $0.9 billion for the nine months compared to $0.8 billion the same period last year. Investments in and advances to affiliates included the additional investment in Wilmar of $0.3 billion for the nine months compared to $0.6 billion the same period last year. Cash used in financing activities was $1.0 billion for the nine months compared to $0.1 billion the same period last year. Long-term debt borrowings for the nine months were $0.5 billion related to the 3.75% notes issued on September 14, 2017 compared to long-term debt borrowings of $1.0 billion the same period last year which related to the 2.5% debt issued on August 11, 2016. Long-term debt payments for the nine months of $0.8 billion primarily related to the redemption of the $559 million notes due on 2018 and the retirement of the $261 million bond that matured in April 2017 compared to long-term debt payments of $9 million the same period last year. Commercial paper borrowings for the nine months were $0.6 billion compared to $0.1 billion the same period last year. Share repurchases for the nine months were $0.7 billion compared to $0.8 billion the same period last year.

At September 30, ~~2017,~~2022, the Company’s capital resources included ~~net worth~~shareholders’ equity of ~~$17.6~~$24.0 billion and lines of credit, including the accounts receivable securitization programs described below, totaling ~~$6.9~~$12.2 billion, of which ~~$4.8~~$10.1 billion was unused. The Company’s ratio of long-term debt to total capital (the sum of the Company’s long-term debt and shareholders’ equity) was ~~27%~~24% and 26% at September 30, ~~2017~~2022 and ~~27% at~~ December 31, ~~2016.~~2021, respectively. The Company uses this ratio as a measure of the Company’s long-term indebtedness and as an indicator of financial flexibility. The Company’s ratio of net debt (the sum of short-term debt, current maturities of long-term debt, and long-term debt less the sum of cash and cash equivalents and short-term marketable securities) to capital (the sum of net debt and shareholders’ equity) was 24% and 28% at September 30, 2022 and December 31, 2021, respectively. Of the Company’s total lines of credit, ~~$4.0~~$5.0 billion supported athe combined U.S. and European commercial paper borrowing ~~facility,~~programs, against which there was ~~$0.6 billion of~~no commercial paper outstanding at September 30, ~~2017.~~2022.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

As of September 30, ~~2017,~~2022, the Company had ~~$0.5~~$1.1 billion of cash and cash equivalents, ~~$0.4~~$0.5 billion of which was cash held by foreign subsidiaries whose undistributed earnings are considered ~~permanently~~indefinitely reinvested. Based on the Company’s historical ability to generate sufficient cash flows from its U.S. operations and unused and available U.S. credit capacity of ~~$3.7~~$6.5 billion, the Company has asserted that these funds are ~~permanently~~indefinitely reinvested outside the U.S.

The Company has accounts receivable securitization programs (the “Programs”) with certain commercial paper conduit purchasers and committed purchasers. The Programs provide the Company with up to ~~$1.7~~$2.6 billion ~~as amended,~~ in funding against accounts receivable transferred into the Programs and expands the Company’s access to liquidity through efficient use of its balance sheet assets (see Note 1614 of “Notes to Consolidated Financial Statements” included in Item 1 herein, “Financial Statements” for more information and disclosures on the Programs). As of September 30, ~~2017,~~2022, the Company ~~utilized $1.4~~had $0.6 billion unused capacity of its facility under the Programs.

As of September 30, 2022, the Company has total available liquidity of $11.2 billion comprised of cash and cash equivalents and unused lines of credit.

For the nine months ended September 30, ~~2017,~~2022, the Company spent approximately ~~$0.7~~$0.8 billion in capital expenditures, ~~$0.2 billion in acquisitions, $0.3 billion in additional Wilmar investment, $0.5~~$0.7 billion in dividends, and ~~$0.7~~$1.2 billion in share repurchases. The Company has a stock repurchase program. Under the program, ~~and~~the Company has ~~acquired approximately 15.7~~90.5 million shares ~~during the nine months ended~~remaining as of September 30, ~~2017. The Company has 15.7 million shares remaining~~2022 that may be repurchased ~~under the program~~ until December 31, ~~2019.~~2024.


~~ITEM 2.~~	~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)~~

~~The~~In 2022, the Company expects total capital expenditures of approximately ~~$1.0~~$1.3 billion ~~during 2017. In 2017, the Company expects aggregate~~and additional cash ~~outlays~~outlay of approximately ~~$0.7~~$0.9 billion in dividends, ~~and up to $1.0 billion in share repurchases,~~ subject to other strategic uses of capital ~~requirements~~ and ~~leverage considerations.~~the evolution of operating cash flows and the working capital position throughout the year.

Contractual Obligations and Commercial Commitments

The Company’s purchase obligations as of September 30, ~~2017~~2022 and December 31, ~~2016~~2021 were ~~$10.0~~$17.9 billion and ~~$10.6~~$18.6 billion, respectively. The ~~decrease~~change is primarily related to a decrease in obligations ~~to purchase lower quantities of agricultural commodity inventories~~for commitments other than energy and ~~lower prices as well as lower obligations in other commitments.~~inventory. As of September 30, ~~2017~~,2022, the Company expects to make payments related to purchase obligations of ~~$8.8~~$16.7 billion within the next twelve months. There were no other material changes in the Company’s contractual obligations during the quarter ended September 30, ~~2017~~.2022.

Off Balance Sheet Arrangements

In September 2017, the Company amended its second accounts receivable securitization program (the “Second Program”) with certain commercial paper conduit purchasers and committed purchasers (collectively, the “Second Purchasers”) and increased its facility from $0.3 billion to $0.5 billion. The program terminates on March 16, 2018 unless extended (see Note 16 of “Notes to Consolidated Financial Statements” included in Item 1 herein, “Financial Statements” for more information and disclosures on the Program).

There were no ~~other~~ material changes in the Company’s off balance sheet arrangements during the quarter ended September 30, ~~2017~~.2022.

Critical Accounting Policies and Estimates

~~Retirement Benefit Changes~~

There were no ~~other~~ material changes in the Company’s critical accounting policies and estimates during the quarter ended September 30, ~~2017.~~2022. For a description of the Company’s critical accounting policies, estimates, and assumptions used in the preparation of the Company’s financial statements, see Part II, Item 7 and Note 1 of “Notes to Consolidated Financial Statements” included in Part II, Item 8, of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.


~~ITEM 3.~~	ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The market risk inherent in the Company’s market risk sensitive instruments and positions is the potential loss arising from adverse changes in: commodity market prices as they relate to the Company’s net commodity position, foreign currency exchange rates, and interest rates. Significant changes in market risk sensitive instruments and positions for the quarter ended September 30, ~~2017~~2022 are described below. There were no material changes during the period in the Company’s potential loss arising from changes in foreign currency exchange rates and interest rates.


~~ITEM 3.~~	~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (Continued)~~

For detailed information regarding the Company’s market risk sensitive instruments and positions, see Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~.2021.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK (Continued)

Commodities

The availability and prices of agricultural commodities are subject to wide fluctuations due to factors such as changes in weather conditions, crop disease, plantings, government programs and policies, competition, changes in global demand, changes in customer preferences and standards of living, and global production of similar and competitive crops.

The fair value of the Company’s commodity position is a summation of the fair values calculated for each commodity by valuing all ~~significant~~of the commodity ~~risk~~ positions at quoted market prices for the period, where available, or utilizing a close proxy. The Company has established metrics to monitor the amount of market risk exposure, which consist of volumetric limits and value-at-risk (VaR) limits. VaR measures the potential loss, at a 95% confidence level, that could be incurred over a one-year period. Volumetric limits are monitored daily and VaR calculations and sensitivity analysis are monitored weekly.

In addition to measuring the hypothetical loss resulting from an adverse two standard deviation move in market prices (assuming no correlations) over a one-year period using VaR, sensitivity analysis is performed measuring the potential loss in fair value resulting from a hypothetical 10% adverse change in market prices. The highest, lowest, and average weekly position together with the market risk from a hypothetical 10% adverse price change is as follows:


	Nine months ended				Year ended
	September 30, 2022				December 31, 2021
Long/(Short) (In millions)	Fair Value		Market Risk		Fair Value		Market Risk
Highest position	$	986	$	99	$	1,426	$	143
Lowest position	112		11		(98)		(10)
Average position	403		40		671		67

Nine months ended Year ended
September 30, 2017 December 31, 2016
Long/(Short) (In millions)
Fair Value Market Risk Fair Value Market Risk
Highest position $ 455
$ 46
$ 876
$ 88
Lowest position (82 ) (8 ) (529 ) (53 )
Average position 215
21
27
3

The change in fair value of the average position was ~~principally~~due to the ~~result~~decrease in prices of ~~an increase in average quantities underlying the weekly commodity position~~certain commodities and, to a lesser extent, ~~an increase~~the overall decrease in ~~prices.~~average quantities.


~~ITEM 4.~~	ITEM 4. CONTROLS AND PROCEDURES

As of September 30, ~~2017~~,2022, an evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in Rules 13a–15(e) and 15d–15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)). Based on that evaluation, the Company’s management, including the Chief Executive Officer and Chief Financial Officer, concluded the Company’s disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is ~~(a)~~(i) recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms and ~~(b)~~(ii) accumulated and communicated to the Company’s management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosure. There was no change in the Company’s internal controls over financial reporting during the Company’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal controls over financial reporting.

~~The~~During 2018, the Company launched an initiative called Readiness to drive new efficiencies and improve the customer experience in the Company’s existing businesses through a combination of data analytics, process simplification and standardization, and behavioral and cultural change, building upon its earlier 1ADM and operational excellence programs. As part of this transformation, the Company is implementing a new enterprise resource planning (ERP) system on a worldwide basis, ~~as part of its ongoing business transformation program,~~ which ~~is expected to improve the efficiency and effectiveness of certain financial and business transaction processes. The implementation~~ is expected to occur in phases over the next several years. The ~~Company has currently implemented changes to certain processes in corporate finance, two processing businesses, and in over 200 locations, and will continue to roll out~~first phase of the ERP system ~~over the next several years.~~implementation occurred in October 2021 to a limited pilot scope of legal entities. The Company ~~has appropriately considered~~continues to consider these changes in its design of and testing for effectiveness of internal controls over financial reporting and concluded, as part of the evaluation described in the above paragraph, that the implementation of the new ERP system in these circumstances has not materially affected its internal control over financial reporting.

PART II – OTHER INFORMATION


~~ITEM 1.~~	~~LEGAL PROCEEDINGS~~

ITEM 1. LEGAL PROCEEDINGS

The Company is routinely involved in a number of actual or threatened legal actions, including those involving alleged personal injuries, employment law, product liability, intellectual property, environmental issues, alleged tax liability (see Note 119 of “Notes to Consolidated Financial Statements” included in Item 1 herein, “Financial Statements” for information on income tax matters), and class actions. The Company also routinely receives inquiries from regulators and other government authorities relating to various aspects of ~~our~~its business, and at any given time, the Company has matters at various stages of ~~resolution with the applicable government authorities.~~resolution. The outcomes of these matters are not within ~~our~~the Company’s complete control and may not be known for prolonged periods of time. In some actions, claimants seek damages, as well as other relief including injunctive relief, that could require significant expenditures or result in lost revenues. In accordance with applicable accounting standards, the Company records a liability in its consolidated financial statements for material loss contingencies when a loss is known or considered probable and the amount can be reasonably estimated. If the reasonable estimate of a known or probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. If a material loss contingency is reasonably possible but not known or probable, and can be reasonably estimated, the estimated loss or range of loss is disclosed in the notes to the consolidated financial statements. When determining the estimated loss or range of loss, significant judgment is required to estimate the amount and timing of a loss to be recorded. Estimates of probable losses resulting from litigation and governmental proceedings involving the Company are inherently difficult to predict, particularly when the matters are in early procedural stages, with incomplete facts or legal discovery; involve unsubstantiated or indeterminate claims for damages; potentially involve penalties, fines, disgorgement, or punitive damages; or could result in a change in business practice.

~~The Company is~~On September 4, 2019, AOT Holding AG (“AOT”) filed a party to numerous lawsuits pending in various U.S. state and federal courts arising out of Syngenta Corporation’s (Syngenta) marketing and distribution of genetically modified corn products, Agrisure Viptera and Agrisure Duracade, inputative class action under the U.S. ~~First,~~Commodities Exchange Act in federal district court in Urbana, Illinois, alleging that the Company ~~brought~~sought to manipulate the benchmark price used to price and settle ethanol derivatives traded on futures exchanges. On March 16, 2021, AOT filed an amended complaint adding a ~~state court~~second named plaintiff Maize Capital Group, LLC (“Maize”). AOT and Maize allege that members of the putative class collectively suffered damages calculated to be between approximately $500 million to over $2.0 billion as a result of the Company’s alleged actions. On July 14, 2020, Green Plains Inc. and its related entities (“GP”) filed a putative class action ~~in Louisiana against Syngenta in 2014,~~lawsuit, alleging ~~Syngenta was negligent in commercializing its products before~~substantially the products were approved in China. Second, the Company is a party in a number of purported class actions filed beginning in 2013 by farmers and other parties against Syngenta in federal and state courts, again alleging that Syngenta was negligent in commercializing its products. The federal actions have been consolidated for pretrial proceedings in a multidistrict litigation (MDL) proceedingsame operative facts, in federal court in ~~Kansas City, Kansas, and some state actions have been consolidated for pretrial proceedings~~Nebraska, seeking to represent sellers of ethanol. On July 23, 2020, Midwest Renewable Energy, LLC (“MRE”) filed a putative class action in MDL in Minnesota state court. In the fourth quarter of 2015, Syngenta filed third-party claims against the Company and other grain companies in these MDLs seeking contribution in the event Syngenta is held liable in these lawsuits. In September 2017, Syngenta filed similar third-party claims against the Company in Iowa state court. The federal court in Illinois alleging substantially the ~~Kansas MDL dismissed all~~same operative facts and asserting claims ~~against~~under the ~~Company on April 4, 2016,~~Sherman Act. On November 11, 2020, United Wisconsin Grain Producers LLC (“UWGP”) and ~~the state~~five other ethanol producers filed a lawsuit in federal court in Illinois alleging substantially the ~~Minnesota MDL dismissed all~~same facts and asserting claims ~~against~~under the ~~Company on September 6, 2016. Therefore, the Company is no longer a third-party defendant in the federal or state MDL.~~Sherman Act and Illinois, Iowa, and Wisconsin law. The ~~Company also intends to move~~court granted ADM’s motion to dismiss the ~~third-party claims in Iowa~~MRE and UWGP complaints without prejudice on August 9, 2021 and September 28, 2021, respectively. On August 16, 2021, the court granted ADM’s motion to dismiss the GP complaint, dismissing one claim with prejudice and declining jurisdiction over the remaining state ~~court. In September 2017, Syngenta and the farmer plaintiffs announced a tentative settlement, subject~~law claim. MRE filed an amended complaint on August 30, 2021, which ADM moved to court approval, of all claims by those plaintiffs. Third, the Company and other grain companies have been named as defendants in numerous individual and purported class action suits filed by farmers and other parties in state and federal courts beginning in the fourth quarter of 2015, alleging the Company and other grain companies were negligent in failing to screen for genetically modified corn. As noted,dismiss on September ~~6, 2016,~~27, 2021. UWGP filed an amended complaint on October 19, 2021, which the court dismissed on July 12, 2022. UWGP has given notice that it intends to appeal the dismissal. On October 26, 2021, GP filed a new complaint in Nebraska federal district court, alleging substantially the ~~Minnesota state MDL dismissed all claims against~~same facts and asserting a claim for tortious interference with contractual relations. On March 18, 2022, the ~~Company, and on January 4, 2017, a~~Nebraska federal district court ingranted ADM’s motion to transfer the ~~Southern~~GP case back to the Central District of Illinois similarly dismissed all of the pending complaints against the Company in Southern Illinois. Some parties are expected to appeal some or all of these dismissals. Currently, the Company remains a defendant in only certain state court actions by farmers and other parties pending in Illinois state court, which the Company hasfor further proceedings. ADM moved to dismiss ~~as well.~~the complaint on May 20, 2022. The Company denies liability, ~~in all of the actions in which it has been named as a third-party defendant or defendant~~ and is vigorously defending itself in these ~~cases. All of~~actions. As these actions are in pretrial ~~proceedings. At this time,~~proceedings, the Company is unable at this time to predict the final outcome ~~of this matter~~ with any reasonable degree of certainty, but believes the outcome will not have a material adverse effect on its financial condition, results of operations, or cash flows.

The Company is not currently a party to any legal proceeding or environmental claim that it believes would have a material adverse effect on its financial position, results of operations, or liquidity.


~~ITEM 1A.~~	ITEM 1A. RISK FACTORS

~~There were no significant changes~~

The information presented below updates, and should be read in conjunction with, the ~~Company’s~~ risk factors ~~during the quarter ended~~ ~~September 30, 2017. For further information about the Company’s risk factors, refer to~~in Part I, ~~“Item~~Item 1A. ~~Risk~~“Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~.2021. Except as presented below, there were no other significant changes in the Company’s risk factors during the quarter ended September 30, 2022.

The Company faces risks related to international conflicts, terrorism or other geopolitical events, such as the conflict in Ukraine, and related sanctions and other economic disruptions.

ADM’s assets and operations located in the region affected by the conflict in Ukraine are at an increased risk to property damage, inventory loss, business disruption, and expropriation. The conflict could continue to impact global margins due to increased commodity, energy, and input costs. The Black Sea region is a major exporter of wheat and corn to the world, and the disruption of supply could cause volatility in prices and margins of these commodities and related products. Ukraine is also the largest supplier of sun seed and sun oil in the world which cannot be completely replaced from other origins. If current inventories are depleted prior to the restoration of operations, Europe will have to reformulate to alternative oils. In addition to ADM’s operations, one of the Company’s joint ventures is also exposed to the same risks. While the Company has a robust sanction program, there is a risk that ADM and its related parties could trade with a sanctioned partner due to the number of sanctions taken against Russia. The Company may also face increased cyber risk given that Russia is known to have extensive capabilities to engage in cyber attacks. Trade receivables may be at risk of higher defaults and other third-party risks could affect ADM’s ability to obtain inputs if suppliers are unable to perform or face insolvency, as certain supplies may not be attainable due to sanctions and/or restrictions on cross-border payment transactions. The Company could be materially impacted if, in the worst-case scenario, the conflict advances to other countries. In such circumstances, trade policies and the Company’s critical global supply chain and logistical networks could be affected, impairing the Company’s ability to satisfy contractual obligations and impacting working capital requirements. Insurance may not adequately cover these risks. In addition, provisions for certain products that ADM produces, particularly those that support the food services channels, could be materially impacted. The Company continues to monitor the conflict in Ukraine and evaluate alternatives to mitigate the impacts of these risks.


~~ITEM 2.~~	~~UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities


Period	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of a Publicly Announced Program(2)	Number of Shares Remaining that May be Purchased Under the Program(2)
July 1, 2022 to
July 31, 2022	205,743	$	79.362	205,587	101,998,106

August 1, 2022 to
August 31, 2022	4,636,133	84.398		4,633,816	97,364,290

September 1, 2022 to
September 30, 2022	6,882,764	86.128		6,879,181	90,485,109
Total	11,724,640	$	85.325	11,718,584	90,485,109

(1)Total shares purchased represents those shares purchased in the open market as part of the Company’s publicly announced share repurchase program described below, shares received as payment for the exercise price of stock option exercises, and shares received as payment for the withholding taxes on vested restricted stock awards. During the three-month period ended September 30, 2022, there were 6,056 shares received as payments for the minimum withholding taxes on vested restricted stock awards and for the exercise price of stock option exercises.

(2)On August 7, 2019, the Company’s Board of Directors approved the extension of the stock repurchase program through December 31, 2024 and the repurchase of up to an additional 100,000,000 shares under the extended program.

Period
Total Number of Shares Purchased ⁽¹⁾
Average Price Paid per Share
Total Number of Shares Purchased as Part of a Publicly Announced Program ⁽²⁾

Number of Shares Remaining that May be Purchased Under the Program ⁽²⁾
July 1, 2017 to
July 31, 2017 475,697
$ 41.000
475,697
19,123,029

August 1, 2017 to

August 31, 2017 1,959,118
41.835
1,959,118
17,163,911

September 1, 2017 to

September 30, 2017 1,494,187
42.433
1,494,187
15,669,724
Total 3,929,002
$ 41.961
3,929,002
15,669,724

~~(1)~~

Total shares purchased represents those shares purchased in the open market as part of the Company’s publicly announced share repurchase program described below, shares received as payment for the exercise price of stock option exercises, and shares received as payment for the withholding taxes on vested restricted stock awards. During the three-month period ended September 30, 2017, there were no shares received as payments for the minimum withholding taxes on vested restricted stock awards and for the exercise price of stock option exercises.


~~(2)~~	On November 5, 2014, the Company’s Board of Directors approved a stock repurchase program authorizing the Company to repurchase up to 100,000,000 shares of the Company’s common stock during the period commencing January 1, 2015 and ending December 31, 2019.

ITEM 6. EXHIBITS


~~ITEM 6.~~	~~EXHIBITS~~



(3)(i)		Composite Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3(i) to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, ~~2001 (File No. 1-44))~~2001).

(3)(ii)		Bylaws, as amended through ~~February 9, 2017~~May 1, 2019 (incorporated by reference to Exhibit 3(ii) to the Company’s Current Report on Form 8-K filed on ~~February 13, 2017 (File No. 1-44))~~May 7, 2019).

~~(4.1)~~(31.1)		~~The registrant hereby agrees that it will, upon request of the Securities and Exchange Commission, furnish a copy of each instrument with respect to long-term debt.~~

~~(12)~~	~~Calculation of Ratio of Earnings to Fixed Charges~~

~~(31.1)~~	Certification of Chief Executive Officer pursuant to Rule 13a–14(a) and Rule 15d–14(a) of the Securities Exchange Act of 1934, as amended.

(31.2)		Certification of Chief Financial Officer pursuant to Rule 13a–14(a) and Rule 15d–14(a) of the Securities Exchange Act of 1934, as amended.

(32.1)		Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(32.2)		Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(101)		~~Interactive Data File~~Inline XBRL file set for the consolidated financial statements and accompanying notes in Part I, Item 1, “Financial Statements” of this Quarterly Report on Form 10-Q.

(104)		Inline XBRL for the cover page of this Quarterly Report on Form 10-Q, included in the Exhibit 101 Inline XBRL file set.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


			ARCHER-DANIELS-MIDLAND COMPANY


			~~ARCHER-DANIELS-MIDLAND COMPANY~~
			/s/ V. Luthar
			V. Luthar

	~~/s/ R. G. Young~~
	~~R. G. Young~~
	~~Executive~~Senior Vice President and Chief Financial Officer



			/s/ D. C. Findlay
			D. C. Findlay
			Senior Vice President, General Counsel, and Secretary

Dated: October ~~31, 2017~~

25, 2022



(In millions)	September 30, 2017			December 31, 2016
	(Unaudited)
Assets
Current Assets
Cash and cash equivalents	$	518		$	619
Short-term marketable securities	261			296
Segregated cash and investments	5,040			5,011
Trade receivables	1,911			1,905
Inventories	8,326			8,831
Other current assets	3,084			4,383
Total Current Assets	19,140			21,045

Investments and Other Assets
Investments in and advances to affiliates	4,972			4,497
Long-term marketable securities	207			187
Goodwill and other intangible assets	3,939			3,703
Other assets	755			579
Total Investments and Other Assets	9,873			8,966

Property, Plant, and Equipment
Land	467			445
Buildings	4,974			4,679
Machinery and equipment	17,858			17,160
Construction in progress	1,166			1,213
	24,465			23,497
Accumulated depreciation	(14,509		)	(13,739		)
Net Property, Plant, and Equipment	9,956			9,758
Total Assets	$	38,969		$	39,769

Liabilities, Temporary Equity, and Shareholders’ Equity
Current Liabilities
Short-term debt	$	728		$	154
Trade payables	3,449			3,606
Payables to brokerage customers	5,135			5,158
Accrued expenses and other payables	2,548			3,982
Current maturities of long-term debt	13			273
Total Current Liabilities	11,873			13,173

Long-Term Liabilities
Long-term debt	6,595			6,504
Deferred income taxes	1,754			1,669
Other	1,117			1,218
Total Long-Term Liabilities	9,466			9,391

Temporary Equity - Redeemable noncontrolling interest	53			24

Shareholders’ Equity
Common stock	2,390			2,327
Reinvested earnings	17,023			17,444
Accumulated other comprehensive income (loss)	(1,843		)	(2,598		)
Noncontrolling interests	7			8
Total Shareholders’ Equity	17,577			17,181
Total Liabilities, Temporary Equity, and Shareholders’ Equity	$	38,969		$	39,769



	(In millions)
Working capital	$	16
Property, plant, and equipment	111
Goodwill	34
Other intangible assets	50
Other long-term assets	6
Long-term liabilities	(19		)
Noncontrolling interest	(11		)
Aggregate cash purchase price, net of cash acquired	$	187



	Level 3 Fair Value Asset Measurements at
	September 30, 2016
	Inventories Carried at Market			Commodity Derivative Contracts Gains			Total Assets
	(In millions)

Balance, June 30, 2016	$	1,099		$	153		$	1,252
Total increase (decrease) in net realized/unrealized gains included in cost of products sold*	(97		)	76			(21		)
Purchases	2,523			—			2,523
Sales	(2,529		)	—			(2,529		)
Settlements	—			(85		)	(85		)
Transfers into Level 3	206			66			272
Transfers out of Level 3	(38		)	(6		)	(44		)
Ending balance, September 30, 2016	$	1,164		$	204		$	1,368



		Three months ended
	Consolidated Statement of Earnings Locations	September 30,
	Consolidated Statement of Earnings Locations	2017			2016
		(In millions)
Effective amounts recognized in earnings
Foreign Currency Contracts	Other income/expense – net	$	—		$	(3	)
Interest Contracts	Interest expense	—			(2		)
Commodity Contracts	Revenues	—			(9		)
	Cost of products sold	(15		)	(37		)
Ineffective amount recognized in earnings
Commodity Contracts	Revenues	—			(1		)
	Cost of products sold	(4		)	1
Total amount recognized in earnings		$	(19	)	$	(51	)



	Cost		Unrealized Gains		Unrealized Losses		Fair Value
	(In millions)

September 30, 2017
United States government obligations
Maturity less than 1 year	$	259	$	—	$	—	$	259
Maturity 1 to 5 years	117		—		—		117
Corporate debt securities
Maturity less than 1 year	2		—		—		2
Maturity 1 to 5 years	90		—		—		90
	$	468	$	—	$	—	$	468



	Three months ended September 30, 2017
	Foreign Currency Translation Adjustment			Deferred Gain (Loss) on Hedging Activities			Pension Liability Adjustment			Unrealized Gain (Loss) on Investments		Total
	(In millions)

Balance at June 30, 2017	$	(1,684	)	$	39		$	(510	)	$	14	$	(2,141	)
Other comprehensive income (loss) before reclassifications	244			(41		)	160			6		369
Amounts reclassified from AOCI	—			15			14			—		29
Tax effect	(40		)	6			(66		)	—		(100		)
Net current period other comprehensive income	204			(20		)	108			6		298
Balance at September 30, 2017	$	(1,480	)	$	19		$	(402	)	$	20	$	(1,843	)

	Nine months ended September 30, 2017
	Foreign Currency Translation Adjustment			Deferred Gain (Loss) on Hedging Activities			Pension Liability Adjustment			Unrealized Gain (Loss) on Investments		Total
	(In millions)

Balance at December 31, 2016	$	(2,102	)	$	6		$	(521	)	$	19	$	(2,598	)
Other comprehensive income before reclassifications	626			(10		)	151			1		768
Amounts reclassified from AOCI	—			22			42			—		64
Tax effect	(4		)	1			(74		)	—		(77		)
Net current period other comprehensive income	622			13			119			1		755
Balance at September 30, 2017	$	(1,480	)	$	19		$	(402	)	$	20	$	(1,843	)



Period	Total Number of Shares Purchased ⁽¹⁾	Average Price Paid per Share		Total Number of Shares Purchased as Part of a Publicly Announced Program ⁽²⁾	Number of Shares Remaining that May be Purchased Under the Program ⁽²⁾
July 1, 2017 to
July 31, 2017	475,697	$	41.000	475,697	19,123,029

August 1, 2017 to
August 31, 2017	1,959,118	41.835		1,959,118	17,163,911

September 1, 2017 to
September 30, 2017	1,494,187	42.433		1,494,187	15,669,724
Total	3,929,002	$	41.961	3,929,002	15,669,724