CHS Big Sky met with the local patrons on Friday, February 21, at the Big Sandy City Hall. Howard Hammond, a board member and a former Big Sandy resident started the meeting with a statement. He has spent two weeks educating himself further, reviewing, and visiting with CHS personal. He wasn't necessarily proud of how we were informed, but he was comfortable with the accuracy of the financials being presented that morning. In his opinion, CHS has one of the best audit processes, and we can trust the information that we were given. "There is no chance of foul play or cooking of the books. The one thing I am sure of is the numbers you will see today are what happened. I know it isn't good news. The elevator in Big Sandy is a good elevator; it's just in a bad location. ( because of railway services)" He researched what we could do to make the Big Sandy Elevator, which is 50 miles from five shuttle loading facilities, profitable. "There isn't any way to make it profitable. We are here to listen, and we will take into consideration everything you have to say."
Keith Schumacher, General Manager, presented the numbers. "Thank you for coming today. As owners, you have a voice in your cooperative." He explained he grew up on a family farm that his brother has taken over the operation. Keith joined CHS in 1996.
He went on to say giving the impact of closing the elevator, according to Keith, they had a significant discussion before any action was taken. Three reasons determined the action taken by the board. They were: The Big Sandy grain facility has struggled to be profitable. Two, the ongoing agriculture business environment faces significant financial challenges, and three we need to find efficiency and make necessary changes.
This is not the first elevator closed. Keith then showed a map of all the shuttle facilities. highlighting the ones built in the last five years.
To give some background, he gave the history of the Big Sandy elevator. Burlington Northern quit train services to Big Sandy in 2003. It was also the start of the 110-car train. Starting in 2012, the financials began to become a challenge, because the financial support, the transision payments, from BN stopped.
Two of the last three years, the elevator financials have been at a loss. Last year in 2019, there was a loss of $500,000.
Mark Gasvoda read a letter written by a group of farmers that got together and which they sent to the board. "They questioned both the numbers and the wisdom of this action. It may be pure economics to some, but you know it isn't that simple."
"The hardship of this closure is personal."
"Two to four million bushels a year go through the elevator. Why is your price 20 cents behind your competition?"
"We ask you to take a hard look at management and merchandizing. Is there a failure there, rather than take it out on the patrons. We ask for an external audit for clarity, of 2017, 2018, 2019, and 2020. We also ask for a profit loss statement for all years concerned and give it to the patrons to review. As a member-owner of the cooperative, we believe it is our right to see these financial statements."
"The managers and patrons may not have the same values."
"The extra 100 miles, equipment's needs, and the logistics are all matters of concern." Mark ended by saying, "Thank you for giving us your time, and we believe we can find solutions."
There was a petition, presented to the board members as well. It had been signed by several farmers which read, " We the undersigned, state that if CHS Big Sky closes the elevator in Big Sandy, we feel you are not supporting our community. Therefore, we will not support CHS Big Sky, and that can also apply agronomy."
There was also a petition asking for the removal of Keith Schumacher from management.
The rest of the time was spent making comments and asking questions.
"Not everybody has two semi trucks. Big Sandy is in the middle of the best wheat in the state, and the closure of the elevator leaves us without an elevator. Hard to believe. It's bad for Big Sandy. It's bad for the growers here."
"I don't have the money to buy a truck or a semi. Nor do I have the time to drive further distance."
"There is more than one way to look at your numbers!"
Hammond believes that if you pay a truck driver, you do have the potential to make money by bypassing the elevators.
"The farthest we drive is 76 miles currently. It's late (to give us this news) in the game, no
bins, no equipment."
"This is about loyalty. This is about respect. Respect would be to have this meeting before you made this decision. This is
about pride. My family, every year for 100 plus years, every bit of the grain has come to this elevator. Shout out to Shane, Sue, and Chris. You should be proud of them. Do the right thing to vote to be loyal, respectful, and prideful to this community."
"Havre benefits by the protein from this community, giving it blending abilities."
"Have you considered how the loss of grain will affect your bottom line?"
Not just farmers were at the meeting. Business owners were also present. "This isn't going to help this town one bit."
At one point, a farmer told the board if they continue to close the elevator, he would not sell grain to nor buy any supplies from CHS. He received applause.
"Corporate wants everything within 40 miles to go to the hub."
"Your price isn't even in the market."
A CHS board member mentioned the changes in the farming industry. "The market is changing driving changes in the farming business. We do want to honor the past, but the past can't dictate where the future is going. It's the economics of the whole industry of agriculture that drives the direction. We will honor the past, whatever the decision, it doesn't drive the future it adapts to the future. There are some tough changes in agriculture. We are trying to adapt to what is coming. You have made good comments, you've been professional. We aren't happy about it, but I don't think we can change the industry. I hope we can earn some of it (your business) back."
"Will this affect what you will be able to offer at Kershaw?"
In response, CHS told the patrons that in the future, they would be merchandizing grain from five states, Washington, Oregon, Idaho, Montana, and South Dakoda, all together.
As everyone was leaving, I asked if they would like to comment on the meeting.
"No, I better not."
"I'm just trying to survive."
"I'll keep them to myself."
"I don't think you'll like my language."
"I like your glasses." We laughed together.
"I'm glad the board came to listen to us."
"I feel sorry for the people who will lose their jobs. We never talked about who they will sell the elevator to. To a farmer who wants it for storage, or to another business. Makes a big difference."
"I can see their side of it too."
"I think it was all said and done before I got here before I got my letter, that wasn't even sealed."
"I'm glad they showed up, don't think it will change anything."
"I'd like to ask, are you guys going to sleep tonight."
"I'm retired, so I should keep my mouth shut, but meat concentration and grain concentration is the wrong direction to go."
"No one would like to see it in print. CHS is a lot bigger than it used to be."
"No one likes to hear they are the scrawny cow in the heard."
"Handwriting is on the wall."
"I want to thank everyone for coming and being so professionals. It was nice the board came down and met us face to face. Very proud of our community. It's highly emotional, and everyone remained professional."
Howard Hammond ended by saying, "I feel for the people of Big Sandy. I've been through this myself twice. There isn't one person on the board that wanted to do this."
