Archer Daniels Midland CompanyNotes to Consolidated Financial Statements (Continued)Note 14.Segment and Geographic InformationThe Company is principally engaged in procuring, transporting, storing, processing, and merchandisingagricultural commodities and products. The Company’s operations are classified into three reportable businesssegments: Oilseeds Processing, Corn Processing, and Agricultural Services. Each of these segments is organizedbased upon the nature of products and services offered. The Company’s remaining operations are aggregatedand classified as Other.The Oilseeds Processing segment includes activities related to processing oilseeds such as soybeans, cottonseed,sunflower seeds, canola, peanuts, and flaxseed into vegetable oils and meals principally for the food and feedindustries. In addition, oilseeds may be resold into the marketplace as a raw material for other processors.Crude vegetable oil is sold “as is” or is further processed by refining, bleaching, and deodorizing into salad oils.Salad oils can be further processed by hydrogenating and/or interesterifying into margarine, shortening, andother food products. Partially refined oil is sold for use in chemicals, paints, and other industrial products.Refined oil can be further processed for use in the production of biodiesel. Oilseed meals are primaryingredients used in the manufacture of commercial livestock and poultry feeds. Oilseeds Processing alsoincludes activities related to the Company’s interest in Wilmar International Limited, the largest agriculturalprocessing business in Asia.The Corn Processing segment includes activities related to the production of sweeteners, starches, dextrose, andsyrups for the food and beverage industry as well as activities related to the production, by fermentation, ofbioproducts such as alcohol, amino acids, and other specialty food and feed ingredients.The Agricultural Services segment utilizes the Company’s extensive grain elevator and transportation network tobuy, store, clean, and transport agricultural commodities, such as oilseeds, corn, wheat, milo, oats, and barley,and resells these commodities primarily as feed ingredients and as raw materials for the agricultural processingindustry. Agricultural Services’ grain sourcing and transportation network provides reliable and efficientservices to the Company’s agricultural processing operations. Also included in Agricultural Services are theactivities of A.C. Toepfer International, a global merchandiser of agricultural commodities and processedproducts.Other includes the Company’s remaining operations, consisting principally of food, feed, and industrialbusinesses and financial activities. Food, feed, and industrial includes: Wheat Processing, with activities relatedto the production of wheat flour; Cocoa Processing, with activities related to the production of chocolate andcocoa products; the production of natural health and nutrition products; and the production of other food, feed,and industrial products. Financial activities include banking, captive insurance, private equity fund investments,and futures commission merchant activities.Intersegment sales have been recorded at amounts approximating market. Operating profit for each segment isbased on net sales less identifiable operating expenses, including an interest charge related to working capitalusage. Also included in operating profit are the related equity in earnings of affiliates based on the equity methodof accounting. General corporate expenses, investment income, unallocated interest expense, marketable securitiestransactions, and FIFO to LIFO inventory adjustments have been excluded from segment operations and classifiedas Corporate. Gross additions to property, plant, and equipment represent purchases of property, plant, andequipment plus amounts allocated to property, plant, and equipment related to acquired businesses.68
Archer Daniels Midland CompanyNotes to Consolidated Financial Statements (Continued)Note 14.Segment and Geographic Information (Continued)Segment Information2007 2006 2005(In millions)Sales to external customersOilseeds Processing $ 13,937 $ 11,867 $ 11,803Corn Processing 5,442 4,860 4,364Agricultural Services 19,706 15,440 15,198Other 4,933 4,429 4,578Total $ 44,018 $ 36,596 $ 35,943Intersegment salesOilseeds Processing $ 408 $ 151 $ 159Corn Processing 370 367 398Agricultural Services 1,838 1,207 1,085Other 125 115 109Total $ 2,741 $ 1,840 $ 1,751Net salesOilseeds Processing $ 14,345 $ 12,018 $ 11,962Corn Processing 5,812 5,227 4,762Agricultural Services 21,544 16,647 16,283Other 5,058 4,544 4,687Intersegment elimination (2,741) (1,840) (1,751)Total $ 44,018 $ 36,596 $ 35,943DepreciationOilseeds Processing $ 163 $ 156 $ 162Corn Processing 277 265 266Agricultural Services 78 75 74Other 160 137 140Corporate 23 24 23Total $ 701 $ 657 $ 665Asset abandonments and write-downsOilseeds Processing $ 5 $ 14 $ 13Corn Processing 1 6 16Other 15 51 13Total $ 21 $ 71 $ 42Interest expenseOilseeds Processing $ 129 $ 85 $ 52Corn Processing 44 31 20Agricultural Services 125 68 42Other 151 113 78Corporate (15) 68 134Total $ 434 $ 365 $ 32669