October is National Co-op Month and a time to celebrate the cooperative model and the strength it brings to local communities.
“CHS is proud to be part of the cooperative system and we’re driven by our purpose to create connections to empower agriculture,” says Jay Debertin, CHS president and CEO. “Our values of inclusion, integrity, cooperative spirit and safety guide us as we work together for shared success and to strengthen our communities.”
Do you know what a co-op is? Here we break it down.
What is a cooperative? A cooperative is defined by USDA as a user-owned and controlled business from which benefits are derived and distributed equitably on the basis of use or as a business owned and controlled by the people who use its services.
Who determines policy? The CHS Board is made up of 17 member-owners, elected by the members.
How are profits distributed? The business is operated for a profit; it’s how the profit is divided that makes a co-op unique. Unlike most corporations where the profits are distributed to stockholders, co-ops distribute profits to member-owners on a patronage basis. Patronage is a method of sharing profits among the members. It is based on how much they purchase and the profitability of the co-op.
What kind of co-op system is CHS? CHS is a blended federated and centralized cooperative system. CHS is unique in that along with the federated system of member cooperatives, we also have Country Operations, made up of centralized retail locations dedicated to serve member-owners in their respective geographies. Along with member cooperatives, those member-owners of Country Operations locations vote for board members at the CHS annual meeting or are represented by delegates from their business unit at the annual meeting.
Help us celebrate National Co-op Month by joining the conversation on social media using #CoopMonth.
Fall harvest is underway for many farmers in our area. The change of season is a busy time for most, and there are things we can do to ensure we go through this time without incidents.
Watch for signs of fatigue. When we are tired, we make mistakes. It may cost some time to take a break, but, in the long run, you may save your own life, or someone else’s.
Take care with equipment. Technology has allowed equipment to get bigger and more powerful. Take time to walk around equipment to look for safety issues. Be familiar with the equipment you are operating and stay aware of how much space you need to operate safely.
Safety on roadways. It is essential to pay attention when you’re moving equipment and to understand other drivers on the road might not know the rules regarding what you are doing. Make sure hazard lights are on, if appropriate, and all the proper signs and markings are displayed.
Take time for safety. While safety precautions can take time, it is time well spent. Most of us have taken shortcuts and not gotten hurt, but is the benefit of saving a few minutes worth the risk of a serious incident?
From all of us at CHS, we wish you a safe and successful harvest season.
Tips courtesy of Country Operations EHS Excellence Under Pressure Newsletter
It’s that time of year again when everybody’s favorite pollinators start showing up. I’m talking about the stinger-bearing insects that we start seeing in the summer: bees and wasps. Since these insects are most abundant in the warmer months, its important to be on the look out for nests and hives that may be developing in your yard. Bees and wasps tend to make theirs homes in places like trees, roof eaves, and even on equipment such as ladder or under tank valve covers.
You can remove the hives by yourself, but it is recommended that you have a professional handle these pests. If you have the proper protection, such as a hat, gloves, or ideally a bee suit if you have one, you can spray insecticide on the hive to get rid of the pests before you take it down. This isn’t a one and done application though as it may take several applications before the bees are all gone.
If you do have bees or wasps in your yard, here are some quick tips that can help you avoid getting stung:
1. Wear light-colored, smooth-finished clothing.
2. Avoid perfumed soaps, shampoos, and deodorants.
3. Wear clean clothing and bathe daily. (Sweat may anger bees.)
4. Wear clothing to cover as much of the body as possible.
5. Avoid flowering plants when possible.
6. Keep work areas clean. Social wasps thrive in places where humans discard food.
7. Remain calm and still if a single stinging insect is flying around. (Swatting at an insect may cause it to sting.)
8. If you are attacked by several stinging insects at once, run to get away from them. (Bees release a chemical when they sting, which may attract other bees.)
a. Go indoors.
b. A shaded area is better than an open area to get away from the insects.
9. If a bee comes inside your vehicle, stop the car slowly, and open all the windows.
10. Workers with a history of severe allergic reactions to insect bites or stings should consider carrying an epinephrine auto injector (EpiPen) and should wear a medical identification bracelet or necklace stating their allergy.
Summer is quickly coming to an end, but by following these tips you can make the best of the remaining summer days.
Make sure your ATV ramps are designed for ATV use, properly rated for the load and are long enough to prevent an overly steep approach to the truck or trailer bed.
When rolling your ATV up or down ramps, secure them to the truck with a pair of tie-downs. Without them, jerky acceleration or braking can easily cause the ramps to slip and fall off the tailgate.
Secure the ATV before driving with appropriate straps or tiedowns. Every time you stop and get out of your vehicle, check to make sure your straps are tight and see if the load has shifted. keep in mind, if you’re hauling in the rain, nylon straps stretch when they get wet, so extra attention is needed if things are damp.
An easy way to save the front of your bed from damage, or even worse, your rear window from being broken by your quad’s bumper, use an old tire to wedge it between the ATV before tying it forward. A simple wood box works too!
Using an extra tie-down or a bungee cord over a loose seat or a set of fender could save you from a ruined day.
Strongest third-quarter net earnings since 2014; $50 million of additional owner equity redemptions authorized in 2021
CHS Inc. released results for its fiscal third quarter ended May 31, 2021. The company reported net income of $273.6 million compared to $97.6 million in the third quarter of fiscal year 2020, an increase of 180.2%. Significant year-over-year earnings growth in all business segments — Energy, Ag and Nitrogen Production — and Corporate and Other businesses each contributed to the increase.
Reflecting strong company performance, the CHS Board of Directors has approved $50 million in additional equity redemptions to member cooperatives and individual owners since the December 2020 CHS Annual Meeting. The increase is incremental to $33 million in approved equity redemptions announced at the 2020 annual meeting, for a total of $83 million in planned owner equity redemptions in fiscal 2021. A distribution of $30 million in cash patronage was also made to owners in early calendar 2021, based on business transacted with CHS in fiscal 2020.
“Robust performance across CHS resulted in a very strong third quarter,” said Jay Debertin, president and CEO of CHS Inc. “Strong global demand in agricultural markets and the hard work we have been doing to gain efficiencies across our supply chain led to higher volumes in nearly every business area, significantly improving our Ag segment earnings compared to the prior year’s third quarter.
“We also are seeing increasing momentum in pandemic recovery as restrictions ease and vaccination efforts progress, which has had a favorable impact on our Energy segment results and overall performance.”
Fiscal 2021 third-quarter highlights
Revenues of $10.9 billion grew 50.9% from $7.2 billion in the third quarter of fiscal 2020.
Earnings were up by more than 40% across all business segments (and Corporate and Other businesses) compared to both the second quarter of fiscal 2021 and the third quarter of the previous fiscal year.
Energy segment results
Improved refined fuels margins resulted in fiscal 2021 third quarter margin gains, as did the absence of a $42.0 million noncash charge to reduce refined fuels inventories to their market value that impacted the prior year’s third quarter, but did not reoccur in the third quarter of fiscal 2021.
Improved margins in the company’s refined fuels business were partially offset by significantly higher prices of renewable energy credits that had a negative impact on margins of approximately $82.0 million, less favorable pricing on heavy Canadian crude oil and lower propane margins due to the reversal of hedging gains recognized during the prior year.
Overall, revenues increased by 24.2% and earnings increased by $59.6 million over the fiscal 2021 second quarter, reflecting volume and margin recovery from the effects of the pandemic.
Ag segment results
Strong global demand drove commodity prices higher, and improved trade relations between the United States and foreign trade partners led to continued higher volumes for grain and oilseed, which significantly improved Ag segment earnings compared to the prior year’s third quarter.
Higher overall margins were partially offset by mark-to-market losses for certain processing and food ingredients products, which the company expects to reverse over time.
Lower volumes of feed and farm supplies were partially offset by increased volumes for agronomy products, stemming from stronger demand due to favorable weather conditions, compared with the previous year’s third quarter.
Other focus areas
Nitrogen Production segment earnings increased in the quarter due to higher income attributed to increased sale prices of urea and urea ammonium nitrate.
Favorable market conditions for edible oils and a recovery in sales volumes compared to earlier in the pandemic drove significantly increased income through the company’s investment in Ventura Foods, LLC.
Focused cost-reduction initiatives, launched in fiscal 2021, continued to gain traction in reducing year-to-date marketing, general and administrative expenses.
The company began to bring employees back to its global offices in full or hybrid capacities as pandemic restrictions lifted. The costs of these activities are not expected to be material.
For the nine months ended May 31, 2021, CHS reported net income of $305.0 million versus $401.0 million for the same period in fiscal 2020.
“We are encouraged by overall improvements in the global economy and the positive traction we’re gaining at CHS with initiatives focused on working more efficiently and effectively throughout the enterprise,” said Debertin. “We are optimistic conditions will continue to improve over the next 12 months. The resilience of our employees and their commitment to our owners and customers has been inspiring and we look forward to the future and continued shared success.”
This document and other CHS Inc. publicly available documents contain, and CHS officers and representatives may from time to time make, “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will” and similar references to future periods. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on CHS current beliefs, expectations and assumptions regarding the future of its businesses, financial condition and results of operations, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of CHS control. CHS actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements. Important factors that could cause CHS actual results and financial condition to differ materially from those indicated in the forward-looking statements are discussed or identified in CHS filings made with the U.S. Securities and Exchange Commission, including in the “Risk Factors” discussion in Item 1A of CHS Annual Report on Form 10-K for the fiscal year ended August 31, 2020, and Item 1A of Part II of CHS Quarterly Report on Form 10-Q for the quarterly period ended May 31, 2021. These factors may include: changes in commodity prices; the impact of government policies, mandates, regulations and trade agreements; global and regional political, economic, legal and other risks of doing business globally; the impact of the ongoing COVID-19 outbreak or other similar outbreaks; the impact of market acceptance of alternatives to refined petroleum products; consolidation among our suppliers and customers; nonperformance by contractual counterparties; changes in federal income tax laws or our tax status; the impact of compliance or noncompliance with applicable laws and regulations; the impact of any governmental investigations; the impact of environmental liabilities; actual or perceived quality, safety or health risks associated with our products; the impact of seasonality; the effectiveness of our risk management strategies; business interruptions and casualty losses; the impact of workforce factors; our funding needs and financing sources; changes in the method of determining, or the replacement of, LIBOR; technological improvements that decrease the demand for our agronomy and energy products; our ability to complete, integrate and benefit from acquisitions, strategic alliances, joint ventures, divestitures and other nonordinary course-of-business events; security breaches or other disruptions to our information technology systems or assets; the impact of our environmental, social and governance practices; the impairment of long-lived assets; and other factors affecting our businesses generally. Any forward-looking statements made by CHS in this document are based only on information currently available to CHS and speak only as of the date on which the statement is made. CHS undertakes no obligation to update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise except as required by applicable law.
Summer is right around the corner, and the 2021 Summer Grease for Gift Cards promotion will soon kickoff to reward customers for buying Cenex® grease. From June 15 through August 14, 2021, customers can earn a $15 VISA® gift card for every 4-10 pack or 35# pail, OR a $50 VISA gift card for every 120# keg of qualifying products purchased.
Qualifying products include:
Corn Head Grease
HD Moly Xtreme
Blue Gard® 500+™
Red Protect XT®
Fluid Gear Grease
Once the program begins:
Customers will be provided a Summer Grease for Gift Cards Redemption Form at time of Cenex grease purchase.
Customers, or dealer on behalf of the customer, must complete the redemption form, attach the qualifying sales receipt(s) or invoices, and mail it to CHS post-marked no later than September 16, 2021.
Contact your local certified energy specialist, Dan Revering, with any questions via email at firstname.lastname@example.org or phone at 218-205-7796.
June is National Safety Month. CHS and Nationwide are proud to share a partnership focused on safety. The following information is provided by Nationwide, the #1 farm and ranch writer in the U.S.*
Safely navigating large agricultural equipment over rural roads to and from the fields is a challenge for even the best drivers. Nationwide reminds farmers to consider the following rules on the safe operation of equipment to help reduce the risk of motor vehicle collisions.
HERMAN, MN. (June 11, 2021) – Over the past year, it has become even more clear that local food shelves and pantries play an important role in communities. The CHS Harvest for Hunger campaign has supported those local organizations in their fight against hunger since 2011. This year, local efforts helped raise more than $20,000 to distribute to local food shelves, pantries and local organizations.
“We have seen increased demand for our local food shelves and food pantries over the past year due to the pandemic,” says Jerry Kramer, general manager, CHS. “Our employees, farmers and communities put cooperative spirit into action to help support these essential organizations in their efforts to feed those in need in our communities through our CHS Harvest for Hunger campaign.”
CHS Harvest for Hunger is organized by CHS Country Operations, the ag retail division of CHS. During March, CHS employees from locations across the United States worked with farmers, ranchers, community organizations and schools to raise $509,184 and 114,746 pounds of food to be distributed to food shelves, pantries and community organizations.
The funds for this program were collected from local producers who generously donated grain to CHS. The cash from those donated bushels was then used as the official donation to our local food shelves, pantries, and local organizations.
With this year’s total, CHS has now raised more than $6.8 million and nearly 3.9 million pounds of food since the campaign was first launched in 2011.
CHS, based in Herman, ag retail business delivers agronomy, energy, and grain products and services to Minnesota and South Dakota ag producers and other customers from eleven locations. It is part of CHS Inc., (www.chsinc.com) a leading global agribusiness owned by farmers, ranchers and cooperatives across the United States. Diversified in energy, agronomy, grains and foods, CHS is committed to creating connections to empower agriculture, helping its farmer-owners, customers and other stakeholders grow their businesses through its domestic and global operations. CHS supplies energy, crop nutrients, seed, crop protection products, grain marketing services, production and agricultural services, animal nutrition products, foods and food ingredients, and risk management services. The company operates petroleum refineries and pipelines and manufactures, markets and distributes Cenex® brand refined fuels, lubricants, propane and renewable energy products.
Jacob Gillespie is a junior at South Dakota State University and is currently majoring in Precision Agriculture and Agronomy. He grew up an a farm outside of Clinton, MN and has worked at Bauers Countryside Ag as well as the Soil and Water Conservation Department. He hopes to one day pursue a career in wild rice agronomy in Northern Minnesota.
Jessica Fenhaus attended Lake Area Technical College for two years and has received her Associates of Science Degree in Ag Business. She plans on continuing her education at South Dakota State University this fall, majoring in Agronomy. Although this is her first summer working for CHS, she has had previous experience working at Wilbur Ellis and on the farm with her dad.
In her internship, she has already learned so much. As summer comes, she is ready to get more involved in scouting and learning as much as she can from the agronomists in her area. She enjoys getting to go to the different locations and seeing the different methods and aspects of the business and farming sides.
Karmen Sperr grew up in Donnelly, MN on her family’s farm where they grow corn, soybeans, and wheat and they also raise pigs. Karmen graduated from Morris Area in High School in 2020 where she was actively involved in FFA. She was also very involved in the Stevens County 4-H program for 13 years. FFA and 4-H are really what drove her passion for agriculture and her decision to major in Agricultural Communications and Agricultural Leadership with a minor in Animal Science at South Dakota State University. In college, Karmen is involved in the Sigma Alpha Sorority, Collegiate Farm Bureau, Swine Club, Prexy Council, Little International, Student’s Association Senate, and the CAFES Ambassador Program. Karmen enjoys many aspects of the ag industry and hopes to one day be an advocate for the industry by working for a commodity group in the Midwest.
Karmen is very excited for her internship this summer and she is excited to see what she can learn in her experiences to strengthen her knowledge about the ag industry.
Moriah Tamilin is currently double majoring in Biology and Chemistry at the University of Central Florida, and she is looking to switch to a more agriculture-focused program in the fall semester. Her experience lies in Horticulture and Landscaping, but she has been given an incredible introduction to the Ag industry through CHS. She says that “the learning opportunity the CHS has granted in this internship has been both overwhelming and fulfilling.”
Moriah is passionate about learning more regarding soil science and soil health. She is particularly fascinated in exploring the efficacy of bioremediation methods. Though it may be years away, she is curious in how bioremediation methods will be made accessible to growers with a limited ability to invest.
As CHS continues to strategically align our cooperative, we are advancing an integrated, enterprise product line and supply chain to bring one consistent approach to our customers and farmer-owners. To accomplish this, the producer boards and management teams of CHS Prairie Lakes and CHS based in Herman, Minnesota have made the decision to consolidate the two business units within CHS.
The two CHS business units have complimentary locations and other operational efficiencies and jointly leveraging our business, assets, products and services will create value for our owners while improving services and offerings to better serve customers. The energy teams began working together this year and have discovered significant opportunities for growth and improved customer service through this partnership. We look forward to scaling that success to other core areas.
Tentative plan is to finalize consolidation by fiscal year end on Aug. 31, 2021. Carl Younce, interim general manager of CHS Prairie Lakes, will continue through the end of May. At that time, Jerry Kramer, current general manager of CHS in Herman, will take over management responsibilities for both business units and serve as the general manager of the combined business. Our goal is to determine the rest of the senior leadership team for the new consolidated business unit by the end of fiscal year 2021.
This consolidation allows us to deliver on Country Operations strategy by streamlining our services and offerings while capitalizing on economies of scale and more efficient use of assets and resources across the expanded geographical territory.
As our customers and owners, you should see little change in how you interact with CHS on a day-to-day business as we will be offering all the same products and services you expect and need from us.
Our focus continues to be on delivering solutions to you that make it easy, helpful and rewarding to do business with CHS.
Thank you for your support, Steven Deal, Chair, CHS based in Herman, Minnesota & Brian Jergenson, Chair, CHS Prairie Lakes