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Tom Astrup, the company's president and chief executive officer of the Moorhead-based cooperative, was in Grand Forks, N.D., at factory district meetings on April 2, was not immediately available to elaborate. Growers said they received news of the 6 percent price improvement in a recent letter.
Co-op officials historically have increased price projection improvements this time of year based on the quality of the beets that went into storage as well as cold, favorable storage and processing conditions.
The stabilized sugar market and prolonged relatively poor prices for corn, soybeans and competing crops have helped boost stock share prices for the beet cooperative. Shareholders have the right and obligation to grow and deliver beets that are processed through the co-op's five factories. Typically, brokered sales occur from harvest through spring.
Jayson Menke, a broker for Acres & Shares LLC in Grand Forks, one of the three brokerage firms that handle Crystal shares, said that as of Monday, April 1, 3,808 shares had been brokered for an average price of $3,357.01 during the 2018/2019 trading season, so far.
That level compares to the previous 2017/2018 season in which 4,659 shares were brokered at an average of $2,940.23 per share, Menke says. He used publicly available data from his company and two others—FNC Ag Stock LLC and Red River Land Co. All are in Grand Forks.
"I'd say the prices were very strong throughout the year," added Nick Watson, an ag stock specialist sith FNC Ag Stock. "There was a day in early January where it got down to $3,150 for a day. The range hit $3,600 both at the end of September and the beginning of March, it hit that price again."
Watson and Menke said sales are winding down as planting approaches.
Barring an unforeseen market crash late this spring, Menke said this will only be the second season that shares have been brokered at more than $3,000 a share for an entire season. Menke, who has been in the brokerage business 16 years, started his new company in late 2018.
"This is an impressive statistic given the state of the rest of the farm economy," Menke said. The best trading seasons occurred when agriculture was financially clicking on all cylinders, Menke said.
This season is on-track as the third-highest average share price since beets started trading through brokerage firms in 1994.
The 2011/2012 share marketing season was the last time average brokered sales topped the $3,000 level. That year, 2,016 shares were brokered in the $3,500 to $4,000 range with an average price of $3,777.82.
In the 2012/2013 season, 3,121 shares traded at an average of $3,941.32 per share. That season started at $4,200 per share, peaked at $4,450 per share in the fall, but dropped off to $2,500.
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April 3, 2019 at 08:40AM
News and Notes from American Crystal General Agronomist, Tyler Grove
Pre-pile has gone well. We are in our third week. The first two weeks were dry so we stayed with our calendar really well, which is abnormal for us. Now, this week we have some new challenges with the rainfall, which was very welcomed.
Sugar content remains high at about 17.8%. That’s really high and that’s showing that the beets are a little on the dry side. We really did need that moisture, but the rain events will mess up our schedule a little bit this week.
Tonnage is tracking well. We’ve been missing this rain so we know it could end up where we want it to. Our estimates have not changed. Our ag staff estimate is at 30.8 tons/acre. We are going to hold that course until we see things change otherwise.
The hail damage in the Moorhead district over the weekend wasn’t widespread, but where it hit was pretty severe. We had about 2,800 acres that were damaged. That hail takes all of your leaves… all of your solar panels... right off the plant. It’s really a bad time of year for that to happen.
How Hail Damage Effects Sugar Content:
The beet wants to repair its solar panels so it pulls sugar reserves from the root as building materials. The sugar content will start dropping as the beet begins to put on new leaves.
American Crystal Sugar Co. share sales have traded well this winter, buoyed by favorable storage conditions, a boosted price projection, and comparisons to other commodity prices. Photo taken April 10, 2018, at Drayton, N.D. (Forum News Service/Agweek/Mikkel Pates)
GRAND FORKS, N.D. — American Crystal Sugar Co. stock share prices and trading ran steady to stronger in the trading season, which seems to be coming to a conclusion, says Jayson Menke, ag stock specialist at FNC Ag Stock LLC, in Grand Forks, N.D.
American Crystal of Moorhead, Minn., is a farmer-owned cooperative in which members purchase shares, which offer the right and obligation to deliver beets. Shares typically are bought and sold from harvest until spring.
FNC Ag Stock is a subsidiary of Farmers National Company. It helps facilitate sales of agricultural stocks that are non-exchange listed, including ethanol and sugar beet shares, including American Crystal.
In the fall of 2017, the FNC Ag Stock's initial sale was in mid-September. Sales started at $2,725 per share. The last sale so far was in mid-March at $3,100 per share. FNC Ag Stock was involved in transfers of 2,000 shares with an average price of $2,943 per share, which is about average for recent years.
The earliest FNC Ag Stock has seen sales shut off has been the middle of March. Last year some shares were sold until May 9 or 10. The latest has been May 12.
"All transfers require board approval from American Crystal," Menke says. Current sugar prices are allowing producers to make money.
One factor strengthening prices was that the American Crystal board in March increased their gross beet payment projection from $46 per ton to $48 per ton for 2018 beets. Sugar price projections don't always happen this time of year. Favorable marketing and a cold spring that helps with beet storage were factors in the increase.
One wild card in this year's sales is that, starting in 2018, American Crystal is requiring that all parties in a limited partnership must sign a notarized personal guarantee to American Crystal.
Five years ago Crystal went from a strong beet payment to a weak payment, due to market shifts. In one-year limited partnerships, some growers told their shareholder limited partners they wanted to not plant beets. Beet co-ops need to cover about $500 to $600 in fixed costs.
"Things needed to be tightened so everyone knew their responsibility," Menke says of the rationale. "Limited partners — with how the co-op laws are written — need to be at risk. The personal guarantee was created to make sure that everybody has skin in the game."
The new requirement seemed to have only "limited" impact, he says.
Another factor buoying beet shares demand is that as beet yields have increased, co-op members have been allowed to plant a smaller percentage of share acres.
Originally, a share of beet stock equalled one acre of production. In 2012, farmers could plant up to 88 percent of their share numbers. In 2018, farmers will be allowed to plant 73 to 78 percent of their share numbers.
Consequently, some farmers seem to be buying shares to help increase their farm's acreage closer to their original producing capacity, but aren't necessarily looking to expand significantly. Also, other commodity prices have become weaker.
"It's not to say that farmers can't make money on other crops this year, but beets have kind of returned to their prominence in the Red River Valley," Menke says. "Beets have made a lot of farms (financially successful) over the last 30, 40 or 50 years."
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April 16, 2018 at 12:27PM
Perdue, in a meeting with The Forum Editorial Board, said he shares agriculture's anxiety over trade. At various points of his visit, the secretary relayed conversations he's had with Trump to try to impress upon the president how trade moves could impact rural America.
"I think agriculture's voice is reaching the White House," Perdue said.
Perdue visited Fargo on March 9 at the request of Sen. John Hoeven, R-N.D. Besides the visit with the editorial board, which included some Agweek staff, he toured the USDA Agricultural Research Service Red River Valley Agriculture Research Center in Fargo and American Crystal Sugar Co.'s sugar beet processing facility in Moorhead, Minn., attended a luncheon with North Dakota Collegiate Farm Bureau members and a roundtable discussion with North Dakota ag leaders alongside North Dakota's congressional delegation and governor.
The roundtable, which also included Hoeven, Sen. Heidi Heitkamp, D-N.D., Rep. Kevin Cramer, R-N.D., Gov. Doug Burgum and former Agriculture Secretary Ed Schafer, drew comments from most participants about trade — the importance of maintaining and expanding trade, issues of fair trade, and what would happen if the U.S. lost access to valuable markets like Canada, Mexico, China and Japan.
As the conversation moved, Hoeven asked presenters to keep their brief speaking time to topics that hadn't already come up. While that likely cut down on some trade conversations, plenty of participants aired their trade concerns.
Mark Martinson, president of the U.S. Durum Growers Association, stressed the importance of keeping the markets encompassed by TPP — an agreement that continued on with 11 countries after Trump pulled the U.S. out of it.
"We cannot lose ... all those markets," he said.
But Martinson also pointed out needed tweaks to NAFTA, which remains under renegotiation. U.S. durum only can be sold as feed-grade in Canada, while Canadian farmers have no such impediments to selling in the U.S., he explained.
Perdue said the feed-grade grain issue fits with the protectionist Canadian dairy provisions in things that need to change for truly free trade. And he expressed enthusiasm for Trump's comments that he may consider rejoining TPP.
The need for continued trade agreements continued to come up as the conversation moved around the table. Doyle Lentz, co-chair of the National Wheat and Barley Scab Initiative asked Perdue to support at least bilaterial agreements with the countries in TPP.
"We have to have trade," he said.
Larry Kinev, representing the U.S. Cattlemen's Association, also stressed the need for fair trade and said cattle producers, including cow-calf operators, backgrounders and feedlots, had suffered since NAFTA.
"We've lost thousands upon thousands of them since the NAFTA agreement," he said.
Dwight Keller, with the Independent Beef Association of North Dakota, asked Perdue to be cautious regarding beef trade with Brazil after the country was found to be allowing exports of poor quality and dangerous meat.
North Dakota was the 34th state Perdue has visited since taking over the USDA. He expressed an enjoyment for such trips, saying it helps to hear the concerns of producers across the country.
"I'm a strange guy, I actually enjoy these kinds of visits," he told the editorial board.
Perdue said he had been very anxious about the aluminum and steel imports the president has imposed when he first heard about them.
"And I still am to some degree," he said.
Perdue said the issue of potential retaliation from other countries certainly is an issue, and he pointed out that agriculture uses a good deal of steel, making it a two-fold problem.
However, he also said he was pleased the president had included some flexibility in the plan, taking Canada and Mexico out of the tariff conversation and opening the door for dialogue with the European Union about eliminating them for those countries, too.
Hoeven said even before the tariffs were publicly announced, Perdue was seeking solutions to potential problems, including possibly getting the Commodity Credit Corporation up and running to help provide protections for farmers.
"He's not only working on it on behalf of ag, he's anticipating it and coming up with solutions," Hoeven said.
Perdue also noted that wrapping up the NAFTA negotiations would relieve some anxiety in agriculture, as would moving forward on talks with other countries.
"The president is a really interesting negotiator," Perdue said, noting the way Trump has operated in his business life as well as so far in his presidency. "I think in some situations it's working, and we'll have to see how it results."
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March 19, 2018 at 10:03AM
By April Baumgarten | Forum News Service
That trend likely will continue this year, said Andy Swenson, a farm management specialist with the Extension Service.
"It may not be the highest performer, but it is a steady performer," he said of soybeans.
Farmers could see an average estimated return of $26 per acre on soybeans. That's slightly more than the $24.85 per acre return projected for counties in the north Red River Valley—Grand Forks, Walsh and Pembina. The return in the northeast region—Nelson, Ramsey, Cavalier and Towner counties—could average $55.85 per acre, according to the projected budgets.
U.S. soybeans have become more popular as demand across the world has increased. The U.S. is the largest soybean producer and second-leading exporter, with producers harvesting a predicted record of 4.38 billion bushels for the crop, according to the U.S. Department of Agriculture.
North Dakota and Minnesota ranked in the top 10 for soybean production last year, though North Dakota was projected to produce 249 million bushels in 2017, down slightly from 2016, according to the USDA's National Agricultural Statistics Service forecast released in November. Minnesota estimates put the state's 2017 production at 373 million, a 4 percent decrease from 2016, the USDA said.
Planting projections from the USDA aren't expected to be released until March 29, said Darin Jantzi, a North Dakota statistician for the USDA's National Agricultural Statistics Service.
Both states planted an estimated record high for soybean acres last year—North Dakota had 7.2 million acres while Minnesota planted 8.2 million acres, according to the USDA.
Costs on the rise
Spring wheat also should see an uptick in planting as projected returns for most of North Dakota are estimated between $14 and $20 per acre, but northwest North Dakota and north Red River Valley regions likely will see breakeven prices, Swenson said. The south valley, which includes Traill, Cass and Richland counties, could see a slight loss.
Farmers who plant corn this year likely will see a loss of $21 to $47 per acres, with Swenson predicting that producers will commit fewer acres to the crop. Corn has lost appeal with farmers in recent years, with U.S. producers harvesting an estimated 14.2 billion bushels last year, a 7 percent decline from 2016, the USDA said.
The crop could see a loss of $33.74 per acre in the north Red River Valley and a loss of $32.23 in the northeast region.
Projected total costs also are expected to be up about 2 to 5 percent from last year, Swenson said in a statement. He warned that the budgets do not take into account price and yield variability, as well as risk.
"The situation on the revenue side was mixed," he said. "Yields have increased noticeably in many instances but prices for several crops are lower."
The valley has the fewest types of crops that could produce positive returns. That's why he warned farmers this could be a challenging year.
The Extension Service doesn't conduct forecasts for sugar beets, but American Crystal Sugar Co. will allow 390,000 acres of beets to be planted this year, about 10,000 acres fewer than last year.
That's due in part to the large yields—early estimates said 2017 presented the second highest yield on record—and an estimated record high sugar count from this year's crop, said Brian Ingulsrud, vice president of agriculture for American Crystal.
The increasing yield is a continuing trend as genetics improve, he said.
On the weather side, conditions are trending toward a year with limited flooding but no drought, said Bill Barrett, meteorologist with the National Weather Service in Grand Forks.
"We're sitting pretty neutral," he said.
Farmers in the Red River Valley watch the world market closely to determine what they should grow, said Paule Sproule, owner of Sproule Farms in Grand Forks. The industry has made advances in genetics, giving producers in North Dakota and Minnesota options when it comes to choosing which crops to plant, he added.
"That's the beauty about North Dakota and part of Minnesota," he said, adding he is optimistic. "We can hold off on our final decision until just before planting."
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January 9, 2018 at 10:28AM
By Mike Spieker
FARGO, N.D. – American Crystal Sugar Company held its annual shareholders meeting December 7th in Fargo. Tom Astrup, the co-op’s president and CEO said the projected initial gross beet payment for the 2017 crop is $46 per ton.
That projected payment is higher than last year’s final payment of $42.45 per ton, mainly because the sugar content of the 2017 crop was higher than that of 2016.
The 2016 sugarbeet crop yielded a record average of 30.4 tons per acres, with an average sugar content of 17.02 percent, stated a release by American Crystal. Better than forecasted sugar prices and good operating results in 2016, including lower operating costs combined to raise the final payment over estimates made earlier in the year. The total shareholder payments for the 2016 crop reached $500 million.
While the 2017 crop didn’t quite reach last year’s record, shareholders still produced a solid 30.2 tons per acre. What may be more important, however, was the higher sugar content of this year’s crop, which came in at 18.11 percent.
So Far, So Good
Despite the warmer than average temperatures in the Red River Valley, Astrup says the sugarbeets are storing nicely. “So far, the weather has been almost ideal,” he said. “We’ve had cool weather in late October and November. Now we are receiving our first shot of winter, which has allowed us to turn on the fans to freeze those beets down.”
Red River Valley sugarbeet growers produced an overall tonnage record for American Crystal in 2017, coming in at 12 million tons grown on 400,000 acres. That mark broke the previous record set in 2006 at 11.91 million ton grown on 500,000 acres.
Astrup says he expects the processing campaign to run until the end of May at a few of American Crystal’s factories.
By Mike Spieker
FARGO, N.D. – American Crystal Sugar Company held their annual shareholders meeting Thursday at the Fargo Holiday Inn. Tom Astrup, president and CEO of American Crystal announced the expansion of the company’s Drayton, N.D factory.
The project is expected to increase the factory’s output by 30% and increase output five to seven percent companywide. American Crystal spent between $20 million and $25 million on the expansion during the summer of 2017. The estimated total of the four-year project is estimated to be around $100 million.
In 2017, American Crystal shareholders produced a record 12 million ton crop on just 400,000 acres – 100,000 less than 10 years ago. With the higher yields, American Crystal is looking to “take advantage of the yield increases” by increasing their processing capacity, says Astrup.
“It probably doesn’t mean there will be more acres of sugarbeets,” said Astrup on the expansion at the Drayton factory. “What is probably means is if yields continue to increase, acres won’t decline as much as they have in the past.”
Of the company’s five plants, Astrup explains why Drayton was selected for the expansion – “It’s economics,” he said. “We have more beets grown in the Drayton factory district than we can process there.” As a result, excess sugarbeets are trucked south to other factories for processing. The Drayton expansion will significantly reduce those freight costs.
Before the expansion, Drayton averaged a 6,900 ton/day capacity. When completed, the factory is expected to be operated at 9,000 ton/day.
The theme of American Crystal Sugar Company's 2017 annual meeting was "We Grow." This video was featured during the annual meeting last week in Fargo.
Curt Knutson elected chairman of American Crystal Sugar Company's Board of Directors
MOORHEAD, MINN. – December 8, 2017 – Curt Knutson, Fisher, Minn. was elected chairman at American Crystal Sugar Company’s Board of Directors reorganization meeting following the cooperative’s annual meeting held on December 7, 2017 at the Fargo Holiday Inn. Knutson was previously vice chairman and has been a director representing the Crookston Factory District since 2007. He has been a sugarbeet grower for 45 years. He also served on the boards of United Sugars and Midwest Agri-Commodities.
At the same meeting, David Mueller was elected vice chairman. Mueller was elected as a director in 2009 and represents the Hillsboro Factory District. He has been a sugarbeet grower near Cummings, North Dakota since 1985 and previously served on the Executive Committee of the Red River Valley Sugarbeet Growers Association Board.
American Crystal also welcomed three new directors to its Board following elections held in November.
Ernie Dusek joined the Board representing the Drayton Factory District. He raises sugarbeets and has farmed south of Grafton, ND. He previously served on the Board of the Red River Valley Sugarbeet Growers Association.
Mark Nelson joined the Board representing the East Grand Forks Factory District. He raises sugarbeets and has farmed near Oslo, Minn. He was most recently on the Executive Committee of the Red River Valley Sugarbeet Growers Association and served as their Minnesota Legislative Liaison.
Cindy Pulskamp joined the Board representing the Hillsboro Factory District. She is part of a family farm north of Hillsboro, ND that has been growing sugarbeets since 1958. She most recently served on the Executive Committee of the Red River Valley Sugarbeet Growers Association as Secretary.
Three Directors also exited American Crystal’s Board after reaching their term limit of four consecutive three year terms.
Robert Green served as the Board’s chairman for the past six years. He has been a director since 2005 representing the Drayton Factory District. He farms sugarbeets near St. Thomas, ND. He also served on the boards of United Sugars and Midwest Agri-Commodities.
John Brainard represented the Hillsboro Factory District as a director since 2005. He has grown sugarbeets since 1998 and was previously on the executive committee of the Red River Valley Sugarbeet Growers Association.
Brian Erickson has been a director since 2005 representing the East Grand Forks Factory District. He has been a sugarbeet grower for over 30 years. He also served on the boards of United Sugars and Midwest Agri-Commodities.
American Crystal Sugar Company is an agricultural cooperative owned by 2,650 shareholders in the Red River Valley involved in the growing and processing of sugarbeets. American Crystal is the largest beet sugar producer in the United States. American Crystal operates sugar factories at East Grand Forks, Crookston and Moorhead, Minnesota, Drayton and Hillsboro, North Dakota, and Sidney, Montana. Its corporate headquarters and technical services center are located in Moorhead.
Younggren re-elected to third term as Red River Valley Sugarbeet Growers Association President