CHS Seeds for Stewardship funds support Dale & Clayton Fire & Rescue

Chris Tews, Dale Fire; Matt McHugh, CHS Safety Leader and Robert Wilkins, Deputy Assistant Chief, Dale Fire Department

CHS Seeds for Stewardship funds are going back into the communities where CHS does business to protect local fire fighters and community members, build stronger rural communities and support ag education.

Through CHS Country Operations Seeds for Stewardship, Dale Fire & Rescue is receiving $2,800 and Clayton Fire Rescue is receiving $2,176 from CHS Larsen Cooperative. Dale Fire & Rescue will be using these funds to purchase a grain bin rescue system and Clayton Fire Rescue will be purchasing rescue saws.   

“CHS Larsen Cooperative has a close working relationship with both of these fire departments. From time to time we have the departments come to our locations to practice rescues and doing walk throughs with our staff; so, they have a better understanding of our business,” says David Neal, General Manager, CHS Larsen Cooperative. “Having this equipment will definitely help these departments provide an increased level of service to our communities and facilities in the area.”

Making the purchase of a grain bin rescue system will provide a centrally located resource that can be quickly deployed to help save lives in the community. There are several large farming operations that grow, harvest, transport, and store crops on site in Readfield. These bulk materials present unique challenges to emergency services and this equipment can help them do their job safely and more efficient than they can today. Dale Fire & Rescue also borders other farming communities who would benefit having a portable coffer dam and grain evacuation system readily available.

“Dale Fire & Rescue is looking forward to purchasing their coffer dam which is designed to keep grain from flowing against the entrapped victim and to create a space around the victim from which grain can be removed. We will be buying a kit that contains the coffer dam, the grain ejector, grates, and case.  This is portable system and we can quickly transport it to the surrounding departments if needed,” says Robert Wilkins, Deputy Assistant Chief, Dale Fire Department.  

Clayton Fire Rescue’s purchase of a rescue saw that cuts steel and a rescue saw that cuts wood will provide a quicker and safer response to many rescue situations. Both saws would be utilized for rescue and fire situations including but not limited to; grain bin rescue, person(s) entrapped in farm machinery, vehicle accidents, accessing fires in machine sheds and barns, removal of brush during wildland fires, and removal of trees and limbs from a natural disaster. The added equipment would provide needed lifesaving equipment to Clayton Fire Rescue and surrounding stations.

“Thank you to the CHS Seeds of Stewardship program for the generous donation of two rescue saws,” says Scott Rieckmann, Director of Public Safety. “The saws will greatly enhance our response to many types of emergency calls in our response area and neighboring communities.”

The CHS Country Operations Seeds for Stewardship matching grant program supports our commitment to create connections that empower agriculture and our rural communities. Through this program, local CHS ag retail business units are identifying organizations in the communities where we live and work who need support for safety, ag leadership, farmer health and well-being, and community engagement.  

Since 2017, CHS has donated more than $1.8 million in funds through CHS Seeds for Stewardship.

Scott Rieckmann, Director of Public Safety; Ryan Jones, CHS YieldPoint Coordinator and Tony Seelow, CHS YieldPoint Equipment Specialist & Fire Dept Member

The CHS Larsen Cooperative- ag retail business delivers agronomy, energy, grain and feed products and services to Wisconsin ag producers and other customers from eight locations in 22 counties. 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.

CHS Harvest for Hunger campaign raises $2,275 locally for food shelves

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 $2,375 and 3,992 pounds of food to distribute to local food shelves and pantries.

“We have seen increased demand for our local food shelves and food pantries over the past year due to the pandemic,” says David Neal, general manager, CHS Larsen Cooperative. “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.

Locally, funds were distributed to:

Freedom Food Pantry, $1,370

New London Community Cupboard, $1,370

Fundraising efforts included the sale of Little Caesars take-home pizza kits and food donations.

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.

The Difference Between Oil and Grease

Often when people think about lubricants, they only think about oil. But oil isn’t the only lubricant equipment owners need to keep their operation moving.

Grease plays a critical part in the health of their equipment and is an essential part for any well-rounded equipment maintenance plan. Grease provides different benefits to keep crucial components protected. To keep your customers’ operations moving and decrease downtime, here’s what you should know about the special role of grease.

How grease is different

Despite their physical differences, common ingredients are found in both oils and greases. The type of base oil, either classified as conventional or synthetic, determines how thermally stable the product is when exposed to extreme conditions. Specific chemical ingredients, also known as additives, are then added to provide each product with a specific slate of benefits.

The biggest difference setting grease apart from oil is its thickener. Grease is a thickened oil, not a thicker oil. The thickener within a grease acts as a sponge, holding the base oil and the additives together. This creates a grease’s semi-fluid or solid structure, as opposed to the syrup-like consistency of oil. This added thickener is crucial when it comes to the applications where grease is needed.

How grease functions differently

At the most basic level, oil and grease both perform the same general function: to prevent metal-on-metal contact and protect equipment from wear. However, there are many ways components move and environments they endure inside equipment.

For intense friction and high-speed applications, an oil is typically the best choice. But other components that endure heavy loads or move vertically typically require a grease. Grease is engineered to stay in place and provide a longer lasting barrier between metal components, such as wheel-bearings.

Grease also acts as an excellent seal. Moving parts that are exposed to the elements are a welcome mat for dirt and debris waiting to contaminate equipment. Grease seals out harmful contaminants, keeping equipment protected for maximum performance and minimum downtime.

How grease maintenance works (not so) differently

Owner’s manuals almost always provide instruction on the oil maintenance routine recommended for a piece of equipment. However, few manuals offer guidance on grease maintenance, even though it’s a vital part of an overall maintenance routine.

Because of its significant role in keeping equipment protected, it is important to use a high-quality grease product. For guidance on the best grease for your customers’ equipment, visit the Cenex Equipment Look-up Tool.

CHS reports $273.6 million in fiscal 2021 third-quarter net income

Closeup of green soybean rows

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.”

FY2021 Quarter 3 CHS Inc. earnings statement by segment
*Earnings is defined as income (loss) before income taxes

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.

Keep your rural road safe

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.*

Nationwide logo

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.

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Bulk Fuel Storage Reminders

One important thing to remind all our customers to do during planting prep is to clean out dirt and other debris that has accumulated in your fuel tanks.  Debris can be pumped into equipment where it will cause build-up that leads to less-than-optimal performance and eventually can require expensive repairs. To reduce the risk, best practices call for fully cleaning out fuel tanks at least once per year and switching out filters each quarter.

Equally as important as getting rid of debris in tanks is keeping water out of the fuel supply. Fuel contaminated with water can cause decreased acceleration, loss of horsepower and, in some cases, engine damage that spells costly downtime. Water in the fuel also allows for microbial growth to form inside tanks that attack the fuel. Frosty springtime mornings add to risk with increased condensation.

Equipment today comes with water drain valves. As you prepare for a busy growing season, remember to use those valves to remove water from machinery, in addition to removing water from storage tanks regularly.

There is one extra-easy way to minimize water in equipment during the season, when you’re done working at the end of the day, take time to fill up the fuel tank. Condensation happens overnight — especially in spring weather — and reducing airspace by filling up tanks every day will reduce that risk.

For more information about bulk fuel storage or to learn more about the importance of Cenex premium diesel fuels, please contact your local sales representative. 

Nicolet Fire District Hosts Emergency Response Fire Training

The Nicolet Fire District, in partnership with the Wisconsin Propane Education & Research Council (WiPERC), is hosting an emergency response, live propane fire training on Wednesday, April 28, 2021 at 6:00 PM.   Approximately 50 fire fighters from the Nicolet Fire District, White Lake Fire Dept., Riverview Fire Dept. and the Doty Fire Dept. are expected to attend.  At times during the training, area residents may see flames shooting 20 feet or more into the air.  Local media and other observers are welcome to watch.

The training consists of classroom instruction on the physical properties of propane and a hands-on portion that includes five fire scenarios including a grill, forklift, bulk tank, and propane terminal piping props. All hands-on training is overseen by Wisconsin certified fire instructors, FIRE LLC and is conducted in accordance with NFPA 1403.The Doty Fire Dept. is providing local coordination and the location for the training.  WiPERC estimates the value of this training is $4,000 to $5,000 depending on the size of the group trained and the number of trainers required.  

Propane will be provided by CHS Larsen Cooperative, who is a WPGA member and participates in the propane industry check-off program, which provides the funding for this training.

The Wisconsin Propane Education & Research Council is the education foundation of the Wisconsin Propane Gas Association (WPGA). 

The training will be held at the Town of Doty Town Hall located at 14899 County Road T Mountain, WI  54149.

For more information on this program contact Emma Corning, WPGA/WiPERC Executive Director at emma@wipga.org or 608-210-3307.                

CHS Reports Fiscal 2021 Second-Quarter Results

CHS Inc., the nation’s leading agribusiness cooperative, today released results for its fiscal second quarter ended Feb. 28, 2021. The company reported a net loss of $38.2 million versus net income of $125.4 million in the same quarter in fiscal 2020. Significant year-over-year earnings increases in Ag and Nitrogen Production segments and Corporate and Other businesses were offset primarily by ongoing COVID-19 pandemic-related impacts in Energy.

“Improved trade relations between the United States and foreign trade partners combined with our operating efficiency initiatives led to record grain and oilseed volume increases and continued price gains, significantly improving our Ag segment earnings over the prior year,” said Jay Debertin, president and CEO of CHS Inc. “Additionally, favorable growing conditions and overall strength in agriculture, helped drive demand for crop inputs, including crop nutrients and crop protection products and services.

“Our Energy segment, while showing improvement over the previous quarter, continues to experience unfavorable refined fuels market conditions related to the COVID-19 pandemic and exceptionally higher costs for renewable energy credits. These factors resulted in volume and margin declines that significantly reduced earnings compared to the prior year.”

Fiscal 2021 second-quarter results reflect: 

  • Revenues of $8.3 billion versus $6.6 billion in fiscal 2020 second quarter, a 26.1% increase. 
  • Energy segment impacts that include:  
    • Continued low refining margins stemming from COVID-19-impacts on global energy demand.
    • Exceptionally high costs of renewable energy credits, which decreased margins.
    • Decreased propane margins and volumes due to warm winter weather conditions across the CHS trade territory during most of the fiscal 2021 second quarter.
    • Modest improvements over fiscal 2021 first quarter as volumes and margins began to rebound. 
  • Ag segment impacts that include:  
    • Favorable weather conditions and improved relations between the U.S. and foreign trade partners, including China, that increased volumes of grain and oilseed commodities as well as feed and farm supplies.
    • Higher margins for certain agricultural products, including processing and food ingredients, which improved because of soybean crush strength.
  • Enterprisewide initiatives that include:  
    • Focused cost-reduction initiatives launched in fiscal 2021 that helped reduce marketing, general and administrative costs.
    • COVID-19-related working arrangements and increased hygiene and infection-control processes to mitigate risk and support business continuity – all CHS operations were deemed to be essential infrastructure industries by federal and state governments.

For the six-month period ending Feb. 28, 2021, CHS reported net income of $31.4 million versus $303.3 million for the same period in fiscal 2020. Revenues for the first six months of fiscal 2021 rose to $17.0 billion, a $2.8 billion, or 19.8%, increase from $14.2 billion in the same period the previous year.

“I am encouraged by the resilience of our employees and their commitment to owners in what continues to be a challenging operating environment,” said Debertin. “We are cautiously optimistic about the rollout of COVID-19 vaccines and other progress being made in response to the pandemic in the U.S. and around the world and the potential impact on our domestic and global businesses.

“As we look ahead to the second half of fiscal 2021, we remain committed to protecting the financial health of CHS, adding efficiency throughout our enterprise to benefit owners and customers, and caring for those who depend on us as we continue creating connections to empower agriculture.”

CHS income chart

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 Report 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, 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. 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.

Take a Critical Look at Your Open Silage Today

By now, you’ve opened up your new crop silage. This is a good time to assess both the silage — and the management decisions that got it there. Deciding what went right, and what went wrong, is helpful to ensuring an even better 2021 silage season.

Most silage challenges fall into one of two categories: dry matter (DM) loss or aerobic instability.

DM loss, or “shrink,” results in less available, and less high-quality, feedstuffs. This can occur due to many management factors but can be addressed by:

  • Harvesting at the right moisture and stage of maturity
  • Cutting at the correct length and with adequate processing (if necessary)
  • Using a proven inoculant to fit your needs
  • Packing tightly
  • Sealing the storage structure

Aerobic instability — often seen as heating — contributes to silage losses by leaving producers with spoiled feed that must be thrown out. In addition, heating normally reduces the forage’s nutritive value. Aerobic spoilage is caused by yeast growth in the majority of the cases. Yeasts need oxygen to grow, making the above management missteps likely suspects when there is heating, especially inadequate packing and sealing. Silages with high population of yeasts have lower nutrient digestibility (fiber, DM), and this leads to reduced animal intakes and performance.

At feedout, when silage is again exposed to air, spoilage yeasts “wake-up” and can grow rapidly, causing heating and spoilage. At this stage, common management practices can help reduce losses, including:

  • Keeping the silage surface tight and clean
  • Not removing silage too far ahead of feeding and leaving it sitting in loose piles, and/or
  • Feeding out at the correct rate

Inoculant choices can help address both DM loss and aerobic spoilage. For example, elite lactic acid bacteria and enzymes, like those found in MAGNIVA® Titanium forage inoculant, can maximize dry matter, nutrient retention and improve aerobic stability to deliver stable, high quality and palatable feed.

Forage inoculants including Lactobacillus buchneri NCIMB 40788 will be more resistant to heating and spoilage as this organism dramatically reduces yeast levels. L. buchneri 40788 applied at a minimum of 400,000 CFU per gram of silage, or 600,000 CFU per gram of high-moisture corn (HMC), has been uniquely reviewed by the FDA and allowed to claim improved aerobic stability.

By taking a critical look at this year’s silage, producers will be on their way to even better silage results next year.

Written by Renato J. Schmidt, Ph.D., Forage Products Specialist, Lallemand Animal Nutrition North America

© 2021 CHS Inc.