All but one of its business segments showed modest gains or even losses. What really thrilled the boys on the Street was one particular line on ADM's income statement: the corn-processing division. There, profit jumped from $132.0 million in fourth-quarter 2004 to $236.5 million during the same period of 2005. That's a 79 percent jump.

Corn processing encompasses two main business lines for ADM: high-fructose corn syrup and ethanol. Neither would make a penny for the company without a huge boost from that old company benefactor, Uncle Sam. Both lines registered tremendous gains: corn syrup profits leapt 150 percent, and ethanol profits rose 40 percent.

As Richard Manning shows in his Against the Grain, high-fructose corn syrup owes its ubiquity to the U.S. government's sugar quotas. According to Manning, ADM financed the lobbying effort that led to the blatantly protectionist sugar-quota system that went into effect in 1982 and has held sway ever since. (Signed into law by one zealously pro-free trade president, Reagan, it now has the full support of another, GW Bush. Clinton, too, paraded his free-trade credentials while accepting the sugar quotas.)

What does the sugar quota have to do with HFCS? The world price of processed sugar typically hovers well below the production cost of HFCS, meaning industrial users such as soft-drink bottlers have no real reason to buy it. The sugar quota props up the price of sugar in the U.S. to twice the world level. With the sugar price artifiically inflated, ADM gained a ready market for its HFCS.

Here is Manning: "The cost of corn syrup hovers about halfway between world sugar and protected domestic sugar, a price designed to 'overcome [soft-drink] bottler resistence, a reluctance, it turns out, solely based on price.'" (He is quoting a Barron's article.)

Today, HFCS is the dominant sweetener in the U.S.; 42 percent of the corn grown here goes into making it. Some scientists think it contributes more to obesity and overweight than equivalent amounts of white sugar. If it weren't for ADM's efforts, no market for it woud exist.

As for ethanol, the federal government reaffirmed its love affair with the stuff in the 2005 Energy Policy Act, which renewed tax incentives for ethanol production and decreed that the U.S. gasoline supply contain 6 billion gallons of it by 2006, and 7.5 billion by 2012. Moreover, the Act requires that cars owned by federal agencies it exclusively.

Even ethanol's most fervent apologists concede that it would have no market without sustained government action. In the 20 years the government has been supporting ethanol, ADM's ethanol line has gone from almost nothing to ADM's second-largest contributor to profit. High-fructose corn syrup has followed s similar path, borne upward from nothing on the back of sugar quota.

But the government's extraordinary support for HFCS and ethanol is probably less important to the two commodities than its generous underwriting of field corn. The subtext of ADM's quarterly report is cheap corn. Bolstered by multi-billion dollar annual government subsidies, corn farmers churned out a record harvest in 2004 and nearly matched it in 2005 -- despite a drought in much of the Midwest.

All that output has sent corn prices tumbling -- and provided a windfall for the world's biggest corn buyer, ADM.

This situation is not one that can be cheered by any thinking green. Supporters hail ethanol as a "renewable" energy source, but producing the corn for it is literally killing the topsoil in the Midwest, the United States' richest store of soil fertility. Corn is a prodigious nitrogen feeder, meaning producing vast monoculture plots of it requires constant lashings of fossil-fuel-based fertilizers.

According to Jason McKenney, writing in The Fatal Harvest Reader (2002), "it takes energy from burning 2,200 pounds of coal to produce 5.5 pounds of usuable nitrogen." If that sounds like a poor return on energy consumed, consider what applying such fertilizer means to the soil it's supposed to enrich. McKenney writes:

We now know that massive use of synthetic fertilizers to create artificial fertility has had a cascade of adverse effects on natural soil fertility and the entire soil system. Fertilizer application begins the destruction of soil biodiversity by diminishing the role of nitrogen-fixing bacteria and amplifying the role of everything that feeds on nitrogen. These feeders than speed up the decomposition of organic matter and humus. As organic matter decreases, the physical structure of soil changes. With less pore space and less of their sponge-like qualities, soils are less efficient at storing water and air. More irrigation is needed, Water leeches through soils, draining away nutrients that no longer have an effective susbstrate on which to cling. With less available oxygen the growth of soil microbiology slows, and the intricate ecosystem of biological exchanges breaks down.

How do you grow anything to such abused soil? Simple: add more fertilizer. The resulting negative-feedback loop is fouling up more than just the Midwestern's layer of topsoil. Runoff from Midwestern fields destroys water-borne ecosystems all along the Mississippi clear down to the Gulf of Mexico, where nitrogen-gorged algae blot out all other marine life in a giant dead zone.

In a bit of Clinton-style triangulation in his SOTU address, President Bush tried (rather wanly, I thought) to grab the mantle of "green" energy, prattling about our "addiction to oil" and "renewable" alternatives. He even hinted at the inherent flaws in corn-based ethanol: "We will also fund additional research in cutting-edge methods of producing ethanol, not just from corn but from wood chips, stalks, or switch grass. Our goal is to make this new kind of ethanol practical and competitive within six years."

That implies that corn-based ethanol is something of a dead end, in "practical and competitive" terms. Interestingly, the remark caused a run
on ethanol stocks -- including ADM, which after thundering ahead 10 percent Tuesday, surrendered nearly 5 percent Wednesday. But listen not to what Bush says but rather watch how he allocates money. Bush gave Dwayne Andreas, the legendary fixer whose family still runs ADM, little reason to worry.

The rest of us, though, have plenty. I'll end with another quote from McKenney:

In 1980 in the United States, the application of a ton of fertilizer resulted in an average yield of 15 to 20 tons of corn. By 1997, the same ton of fertilizer yielded only 5 to 10 tons [of corn]. Between 1910 and 1983, United States corn yields increased 346 percent while our energy consumption for agriculture increased 810 percent.