What Do You Get When Corn Rises and Oil Falls? This Very Unlucky Stock.

A decade ago, Archer Daniels Midland (ADM) was a grain processing giant that billed itself as the “Supermarket to the World.” Then, in 2006, it brought in a former executive at Chevron (CVX), Patricia Woertz, to be chief executive and lead it into a biofuel-ed future.

Now it’s caught in a bad squeeze.

Thanks to a drought in the Midwest, corn prices have shot up.

^SG3C Chart

^SG3C data by YCharts

But crude oil prices have been dropping.

^SG2A Chart

^SG2A data by YCharts

Back in 2006, Fortune wrote in this profile of Woertz: “A continued drop in the price of oil (which helps set the price for ADM ethanol in the U.S. and biodiesel in Europe), combined with a sharp rise in corn or soy (raw ingredients for a myriad of ADM products), would put a quick end to Woertz's corner-office honeymoon.”

The honeymoon's definitely over, as seen in this ADM stock chart, and a look at ADM profit margins. ADM Chart

ADM data by YCharts

ADM Chart

ADM data by YCharts

Emily Lambert is an editor for the YCharts Pro Investor Service which includes professional stock charts, stock ratings and portfolio strategies.



Please note that this feature is only available as an add-on to YCharts subscriptions.

Please note that this feature requires full activation of your account and is not permitted during the free trial period.

Start My Free Trial {{root.upsell.info.call_to_action}} No credit card required.

Already a subscriber? Sign in.