UPDATE 3-ADM's lower profit misses Street view, shares fall

* Q3 net earnings $8 million, or 1 cent per share

* Earnings fall 98 pct on one-time charges, lower sales

* Excluding charges, Q3 share 37 cts vs Street view 49 cts

* Ethanol uncertainty adds pressure, shares down 10 pct (Recasts, adds quotes and background, updates stock activity)

By Karl Plume

CHICAGO, May 5 (Reuters) - Archer Daniels Midland Co (ADM.N) shares were down 10 percent on Tuesday after the U.S. agricultural processor reported a 98 percent drop in quarterly earnings due to sales slowed by the recession and one-time equity investment losses.

The release of a draft rule by the U.S. environmental regulators to scrutinize the carbon footprint of biofuels production more closely alos pressured the shares of ADM, a top maker of corn-based ethanol fuel in the United States.

"The results weren't great, the outlook was a little tepid and there is this uncertainty about ethanol," said Christina McGlone, an equities analyst at Deutsche Bank Securities.

A draft rule issued by the U.S. Environmental Protection Agency on Tuesday was designed to reduce the impact of biofuels on the climate and on food prices. [ID:nN05476101] But analysts said it could impact the profitability of some ethanol plants.

ADM currently has the capacity to produce about 1 billion gallons of ethanol a year at its U.S. wet corn mills, with capacity for an additional 550 million gallons under construction.

About 20 percent of U.S. ethanol capacity is currently shut down industrywide due to thin margins caused by historically high corn feedstock costs and weak fuel demand.

DULL DEMAND

Operating profit in ADM's oilseed and corn processing segments, agricultural services and other segments fell 72 percent on dulled demand for raw materials and fuel.

ADM is one of the largest processors of corn and soybeans and producers of ethanol in the United States.

Its weaker-than-expected earnings follow similarly disappointing results last month from other agribusinesses, including Bunge Ltd (BG.N) and privately held Cargill.

"Overall, operating results were generally weaker and all of our segments were down compared to last year's exceptionally strong third quarter results," said ADM CEO Patricia Woertz.