Published: 2022-10-25 00:00:00 ET

HTTP/1.1 200 OK HTTP/1.1 200 OK X-Crawlera-Slave: 173.211.26.137:3128 X-Crawlera-Version: 1.60.1 accept-ranges: bytes content-type: text/html last-modified: Tue, 25 Oct 2022 20:02:22 GMT server: AmazonS3 x-amz-id-2: 3sFfIFgosGS9aTxScLzVhvU1IQeirwicvFDYOz/gOmGpJ37MAIlOv92+x5zRBzOED3HU8JrIaCQ= x-amz-meta-mode: 33188 x-amz-meta-s3cmd-attrs: uid:504/gname:fitrprnt/uname:fitrprnt/gid:504/mode:33184/mtime:1666728133/atime:1666728133/md5:b1ea36411e9f67e1925290e76fbe45e4/ctime:1666728135 x-amz-replication-status: COMPLETED x-amz-request-id: 34E2R14S5FRA605W x-amz-server-side-encryption: AES256 x-amz-version-id: hmxSWDYe8.30oFkNxLJS83zGQhGwB2yS x-content-type-options: nosniff x-frame-options: SAMEORIGIN x-xss-protection: 1; mode=block akamai-x-true-ttl: 604800, 604800, -1 x-akamai-transformed: 9 204316 0 pmb=mTOE,2 expires: Wed, 05 Apr 2023 16:31:46 GMT cache-control: max-age=0, no-cache, no-store pragma: no-cache date: Wed, 05 Apr 2023 16:31:46 GMT vary: Accept-Encoding strict-transport-security: max-age=31536000 ; includeSubDomains ; preload set-cookie: bm_mi=4B99AF105C7548FDCD3B057DBFAC542E~YAAQFC0tFweHfk+HAQAA1I9CUhMypW4FbqiNZDDjREotxJn4B++2lTblC+qAJl3XHcVIltyym0Q2Y/FhiML/MtbdHFM2H3kScEIvwU8Wmmp8mmIkaaU5MZ76AbhP1KKQ1oqmto8qpZ86iU3KmFDO9jPQkbYRwmnqdo3LooY3TLWThVIFofMeFK7sbMmgnpbGOPknm5BaF5zrDEBtDFICxsbhBTG0RkOf9iKqENRRRD99RHLl/R6nuDj1trom8LoU7Rnl0ZXc5I8oe/8408LjSLjmfyUcMGe5BRUzazAlQFdzIWBSaLMTBSsozPYnvNYidQovymGi+vHFNJpS8SVkliM+xG9+KKnyjgpBM6JbfLF9EmMXnFd3LXzak4WE0582YFLYq4eY6w==~1; Domain=.sec.gov; Path=/; Expires=Wed, 05 Apr 2023 18:29:57 GMT; Max-Age=7091; Secure set-cookie: bm_sv=1E39550848DDC60BBF2A8C740C8F7990~YAAQFC0tFwiHfk+HAQAA1I9CUhPrmvtcQrTwZDBkVhARpw6J6gkie2UrhuK/CWcpD/xJGyqi7CtBhLE8D30QQcN7jP2Ia9lEfBx3elYwPJZve2OVHjIbiVwi2u0rTpnTnQlUN03p3413UqvNGVISUFyIPpaIjtWyaDn4NecCoN1vOPj4W8IYB63O715gf97S9pYyh068QYnB79lDJuzVqBX/Wy6QiihHFBDXb3OmcmxcI3czIUT8uFeUdwCh~1; Domain=.sec.gov; Path=/; Expires=Wed, 05 Apr 2023 18:30:37 GMT; Max-Age=7131; Secure Transfer-Encoding: chunked Proxy-Connection: close Connection: close

---

---

---

---

---

---

---

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 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 nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.  For further information, refer to the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 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.

Segregated Cash and Investments

The Company segregates certain cash, cash 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 consolidated statements of cash flows.

Receivables

The Company records receivables at net realizable value 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 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, general, and administrative expenses of $29 million and $73 million in the three and nine months ended September 30, 2022, respectively, and $1 million and $9 million in the three and nine months ended September 30, 2021, respectively.

Cost Method Investments

Cost method investments of $465 million and $297 million as of September 30, 2022 and December 31, 2021, respectively, were included in Other Assets in the Company’s consolidated balance sheets. Revaluation gains of $37 million in the nine months ended September 30, 2022, and $9 million and $49 million in the 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 earnings. There were no revaluation gains recorded in the three months ended September 30, 2022.

---

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.

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, 2023, the Company will be required to adopt the amended guidance of ASC Topic 805, Business Combinations, which improves comparability for both the recognition and measurement of 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 contract assets and contract liabilities acquired in a business combination in accordance with 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 its consolidated financial statements.

Effective January 1, 2023, the Company will be required to adopt the amended guidance of ASC Subtopic 405-50, Liabilities - Supplier Finance Programs, which enhances the transparency of supplier finance programs. The amended guidance requires an entity (buyer) in a supplier finance program to 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 potential magnitude. Early adoption is permitted. The adoption of this amended guidance will require the Company to provide disclosures about its supplier finance programs, if material, but is not expected to have an impact on its consolidated financial statements.

---

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, 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 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 fulfillment activity and are included in cost of products sold. Accordingly, amounts billed to customers for such costs are included as a component of revenues.

Taxes Collected from Customers and 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 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.

---

Disaggregation of Revenues

The 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

---

			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

---

			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.

---

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 the product. Freight and shipping are recognized as a component of 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 revenue are commissions and brokerage income generated from executing orders and clearing futures contracts and options on futures contracts on behalf of 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.

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, 2022 and December 31, 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 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
			(In millions)
Assets:
Inventories carried at market			$	—					$	6,765					$	3,004					$	9,769
Unrealized derivative gains:
Commodity contracts			—						902						460						1,362
Foreign currency contracts			—						238						—						238
Interest rate contracts			—						46						—						46
Cash equivalents			448						—						—						448
Segregated investments			1,338						—						—						1,338
Total Assets			$	1,786					$	7,951					$	3,464					$	13,201
Liabilities:
Unrealized derivative losses:
Commodity contracts			$	—					$	944					$	815					$	1,759
Foreign currency contracts			—						191						—						191
Debt conversion option			—						—						15						15
Inventory-related payables			—						859						106						965
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 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.

---

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.  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 quotations or market transactions in either the listed or 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 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 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 in Level 1.

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 debt conversion option is the equity-linked embedded derivative related to the exchangeable bonds issued in August 2020. The fair value of the embedded derivative is included in long-term debt, with changes in fair value recognized as interest, and is valued with the assistance of a third-party pricing service (a level 3 measurement).

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

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

---

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

* Includes increase in unrealized losses of $394 million 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 three 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, 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

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

---

The following table presents a rollforward of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three 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, 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

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

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, 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

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

---

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

* Includes increase in unrealized losses of $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, 2021.

---

The following table presents a rollforward of liabilities 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 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 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. 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.

---

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, 2022 and December 31, 2021. The Company’s Level 3 measurements may include basis only, transportation cost only, or both price components. As an example, for Level 3 inventories with basis, the unobservable component as of September 30, 2022 is a weighted average 27.9% of the total price for assets and 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		%

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.

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 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 forward commodity purchase or sale contracts, and inventories of certain merchandisable agricultural 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, 2022 and December 31, 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

---

The following 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, 2022 and 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)

---

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 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 and Net Investment Hedging Strategies

The Company had certain derivatives designated as cash flow and 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 cash flow hedges to hedge the forecasted interest payments on certain letters of credit from banks. The terms of the interest rate swaps match the terms of the forecasted interest payments. The deferred gains and losses are recognized in 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, 2022 and December 31, 2021, the Company 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 AOCI, respectively, related to the interest rate swaps and swap locks. The Company expects to recognize amounts deferred in AOCI in its consolidated statement of earnings during the life of the debt instruments.

---

For each of the hedge programs described below, the derivatives are designated as cash flow hedges.  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 and losses arising from the hedge are reclassified from AOCI to either revenues or cost of products sold, as applicable. As of September 30, 2022 and December 31, 2021, the Company had after-tax gains of $270 million and $161 million in AOCI, respectively, related to gains and losses from these programs.  The Company expects to recognize $270 million of the September 30, 2022 after-tax gains in its consolidated statement of earnings during the next 12 months.

The Company uses futures or options contracts to 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 normally grind approximately 65 million bushels of corn per month. During the past 12 months, the Company hedged between 17% and 32% of its monthly grind. At September 30, 2022, the Company had designated hedges representing between 5% and 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 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 85% and 100% of the anticipated monthly soybean crush for soybean purchases and soybean meal and oil sales at the designated facilities. At September 30, 2022, the Company had designated hedges representing between 0% and 100% of the anticipated monthly soybean crush for soybean purchases and soybean meal and oil sales at the designated facilities over the next 12 months.

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.

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

---

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, 2022 and 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

---

Other Net Investment Hedging Strategies

The Company has designated €1.3 billion and €1.8 billion of its outstanding long-term debt and commercial paper borrowings at September 30, 2022 and December 31, 2021, respectively, as hedges of its net investment in a foreign subsidiary. As of September 30, 2022 and December 31, 2021, the Company had after-tax gains of $311 million and $55 million in AOCI, respectively, related to foreign exchange gains and losses from net investment hedge transactions. The amount is deferred in AOCI until the underlying investment is divested.

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

(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 $3 million and $4 million at September 30, 2022 and December 31, 2021, respectively. Interest earned on financing receivables of $3 million and $11 million for the three and nine months ended September 30, 2022, respectively and $2 million and $8 million for the three and nine months ended September 30, 2021, respectively, is included in interest and investment income in the consolidated statements of earnings.

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

---

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

On February 28, 2022, the Company issued its first sustainability bond of $750 million aggregate principal amount of 2.900% notes due March 1, 2032. Net proceeds before expenses were $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.

During the quarter ended September 30, 2022, the Company redeemed €500 million aggregate principal amount of Fixed-to-Floating Rate Senior Notes due 2022 issued in a private placement on March 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 interest rate of SOFR plus 45 basis points. The facility will be used to finance working capital requirements of ADM entities in the Asia Pacific region and general corporate purposes.

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

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

The Company has accounts receivable securitization programs (the “Programs”). The Programs provide the Company with up to $2.6 billion in funding resulting from the sale of accounts receivable with $0.6 billion unused capacity as of September 30, 2022 (see Note 14 for more information about the Programs).

The Company’s effective tax rates were 15.7% and 16.9% for the three and nine months ended September 30, 2022, respectively, compared to 18.4% and 15.8% for the three and nine months ended September 30, 2021, respectively. The change in the rate was primarily due to changes in the geographic mix of earnings and the impact of discrete tax 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 Inflation Act has no immediate impact and is not expected to have a material adverse effect on ADM’s results of operations going forward, the Company will continue to evaluate its impact as further information becomes available.

---

The Company is subject to income taxation and routine 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 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 and the Company cannot predict or provide assurance as to the ultimate outcome of these ongoing or future examinations. However, the Company does not anticipate that the total amount of unrecognized tax benefits will increase or decrease significantly in the next twelve months. Given the long periods of time involved in resolving tax positions, the Company does not expect that the recognition of unrecognized tax benefits will have a material impact on the Company’s effective income tax rate in any given period.

The Company’s subsidiary in Argentina, ADM Agro SRL (formerly ADM Argentina SA and Alfred C. Toepfer Argentina SRL), received tax assessments challenging transfer prices used to price grain exports for the tax years 1999 through 2011 and 2014. As of September 30, 2022, these assessments totaled $6 million in tax and up to $29 million in interest (adjusted for variation in currency exchange rates). The Argentine tax authorities 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. The Company strongly believes that it has complied with all Argentine tax 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 2014, and estimates that these potential assessments could be approximately $78 million in tax and $49 million in interest (adjusted for variation in currency exchange 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 2014.

In 2014, the Company’s wholly-owned subsidiary in the Netherlands, ADM Europe B.V., received a tax assessment 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. 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 court issued an unfavorable ruling and in October 2020, assigned a third party expert to establish a valuation. During the 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 the Dutch tax authorities have six weeks to file an appeal. Subsequent appeals may take an extended period of time and could result in financial impacts of up to the entire amount of 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.

---

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

---

			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.

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

Gains on sales of assets in the three and nine months ended September 30, 2022 and 2021 consisted of gains on sales of certain assets and disposals of individually insignificant assets in the ordinary course of business.

Debt extinguishment charges in the three and nine months ended September 30, 2021 were related to the early redemption of $500 million aggregate principal amount of 2.750% notes due in March 2025.

Pension settlement in the three and nine months ended September 30, 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.

---

The Company’s operations are organized, managed, and classified into three reportable business segments: Ag Services and Oilseeds, Carbohydrate Solutions, and 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 Business.

Intersegment sales have been recorded at amounts approximating market. Operating profit for each segment is based on net sales less identifiable operating 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 unallocated corporate expenses and interest expense net of interest income. Corporate results also include revaluation gains and losses on cost method investments and the share of the results of equity investments in 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.

---

---

			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) Consists of gains on the sale of certain assets in all periods presented.

Asset impairment, exit, and restructuring costs in the three months ended September 30, 2022 consisted of $16 million of impairments related to certain long-lived assets and $12 million of restructuring charges, presented as specified items within segment operating profit. Asset impairment, exit, and restructuring costs in the nine months ended September 30, 2022 consisted of $20 million of 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.

Asset impairment, exit, and restructuring costs in the three months ended September 30, 2021 consisted of $2 million of restructuring charges, presented as a specified item within segment operating profit. Asset impairment, exit, and restructuring costs in the nine months ended September 30, 2021 consisted of $54 million of impairments related to certain long-lived assets and $26 million of restructuring charges, presented as specified items within segment operating profit, and $4 million of restructuring charges in Corporate.

The Company has an accounts receivable securitization program (the “First Program”) with certain commercial paper conduit purchasers and committed purchasers (collectively, the “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 transfers certain of the purchased accounts receivable to each of the First Purchasers together with a security interest in all of its right, title, and interest in the remaining purchased accounts receivable. In exchange, ADM Receivables receives a cash payment of up to $1.8 billion for the accounts receivable transferred. The First Program terminates on November 18, 2022, unless extended.

The Company 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 Ireland Receivables). ADM Ireland Receivables transfers certain of the purchased accounts receivable to each of the Second Purchasers together with a security interest in all of its right, title, and interest in the remaining purchased accounts receivable. In exchange, ADM Ireland Receivables receives a cash payment of up to $0.8 billion (€0.8 billion) for the accounts receivables transferred. The Second Program terminates on February 16, 2023, unless extended.

---

Under the First and Second 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 acts as a servicer for the transferred receivables. At September 30, 2022 and December 31, 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, 2022 and December 31, 2021, the fair value of trade receivables transferred to the Purchasers under the Programs and derecognized from the Company’s consolidated balance sheets was $2.0 billion and $2.2 billion, respectively. Total receivables sold were $42.9 billion and $36.7 billion for the nine months ended September 30, 2022 and 2021, respectively. Cash collections from customers on receivables sold were $42.1 billion and $34.2 billion for the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022 and December 31, 2021, receivables pledged as collateral to the Purchasers were $1.3 billion and $0.5 billion, respectively.

Transfers of receivables under the Programs resulted in an expense for the loss on sale of $4 million and $12 million for the three and nine months ended September 30, 2022, respectively, and $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.

All cash flows under the Programs are classified as operating activities because the cash received from the Purchasers upon both the sale and collection of the receivables is not subject to significant interest rate risk given the short-term nature of the Company’s trade receivables.

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---

---