With ethanol a political football, ADM’s chief executory, Patricia Woertz, and its stick are getting hit

By Joseph Weber

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Even before oil prices collapsed, Patricia A. Woertz had one of the most frail balancing acts in business. Now things are acquirement downright precarious.

As supreme executive functionary of Archer Daniels Midland (ADM), the world’s largest texture processor, Woertz has watched various parts of her $70 billion-a-year empire gyrate wildly during the out of the reach of year. Her continued fondness for corn-based ethanol angers many corporate customers at a span when enthusiasm for the controversial fuel additive is waning. Ethanol’s profitability has eroded as oil has slipped, and social critics complain that it harms the environment and diverts corn supplies, raising food prices.

Woertz, a composed and deliberate leader, occasionally reveals the strain she’s under. When skeptical company interns peppered her through questions end for end ADM’session focus without interruption ethanol during a discussion at headquarters in Decatur, Ill., she responded sharply: “We are not correct an ethanol company. I’ll say that again. Everybody perceive by the ear that? We are not just every ethanol company.”

She’s right. While ethanol was the largest separate contributor to ADM’sitting profits last year, driving a unit that accounted for 19% of company profits on 7% of sales, it’s dwarfed through the business of processing wheat, cocoa, soy, seeds for vegetable oil, and other staples.

But Woertz committed to an ethanol-heavy strategy when oil was on the way up and alternative “biofuels” looked smart. Now she’sitting sticking with that make a bet. She plans to build two more plants by early 2010 that could increase extension to 1.9 billion gallons a year, up from the current 1.1 billion. Although using corn by reason of ethanol wins ADM few fans these days, alternatives are slow in coming. ADM has talked up a new joint hazard one’s self in Brazil to produce the to be added. from sugar, but that production will meet only local needs.

The overall ethanol market, meanwhile, is imploding. Popularized in the at dawn 1900s when it was used in the Model T Ford, the additive is blended with petrifaction fuel to divide costs. Demand soared as crude oil prices rose, prompting increased production, and dropped dramatically at what time oil prices hurl down.

With the bankruptcy of leading distributor VeraSun Energy (VSE) two months ago, ADM has cemented its dubious position as industry titan. That dominance will probably make Woertz and her 27,000-employee company any even more inviting target with a view to environmental groups and other ethanol opponents in industries ranging from food to oil. As if this weren’t enough to worry about, Woertz, 55, will also have to deal with fallout from a Hollywood movie starring Matt Damon appropriate in theaters in September that focuses on ADM’s more than price-fixing. Woertz shrugs opposite to the challenges, arguing that she remains focused on “the things we be possible to control.”

For decades, ADM, a lobbying virtuoso, has benefited from lavish financial and regulatory support from Washington. Even with recent increases in federal ethanol subsidies, falling ethanol prices have made it tough for ADM and its rivals to cover their costs for the additive. The Renewable Fuels Assn., which represents ethanol makers, says it has suggested to the transition team that President-elect Barack Obama provide dominion guarantees for $1 billion in short-term bank loans for struggling producers and up to $50 billion more to develop ethanol technology and new biofuels. Woertz is doing her piece. In 2008, ADM paid more than $1 million to lobby founded on politicians on energy, trade, and environmental legislation, up from $900,000 for 2007 and $300,000 in 2006.

Reaction in Washington is felicitous to be apathetic. Political attention is fixated on crises on Wall Street and in Detroit. Obama has said he supports ethanol subsidies in universal, but he is more interested in propping up the product of biofuels from sources other than corn. In addition, he favors more research on turn and twist and solar energy.