April 23, 2024

CHS to acquire eight Cargill grain facilities across five US states

CHS Inc revealed plans to purchase eight Cargill grain facilities spread across five US states, Progressive Farmer reported.

The agreement, outlined as an intent-to-purchase arrangement, aims to enhance CHS's enterprise supply chain while offering market access and comprehensive value to stakeholders.

The targeted Cargill elevators span locations in Pipestone and Maynard, Minnesota; Morris and Seneca, Illinois; Holdrege, Nebraska; Cheyenne Wells and Byers, Colorado; and Parker, South Dakota. This acquisition is expected to contribute approximately 15.5 million bushels of grain storage capacity to CHS Inc.'s operations.

Pending regulatory approvals, the transaction is tentatively set to conclude in early June 2024, as outlined by CHS. However, financial terms associated with the deal remain undisclosed by both companies.

Rick Dusek, executive vice president of ag retail distribution and transportation for CHS, underscored the significance of local assets tailored to meet the evolving needs of farmer-owners, emphasising CHS's commitment to efficient supply chain connectivity and global market access.

In response, Cargill highlighted the shared values, strategic alignment, and effective business model underpinning its partnership with CHS, identifying CHS as the ideal partner for the sale.

As one of the leading grain-handling companies in North America, CHS Inc. ranks second on Sosland Publishing Co.'s 2022 Top 10 list of grain majors. As of 2022, CHS owned 231 licensed grain storage facilities with a total capacity of 403 million bushels (mb). Meanwhile, Cargill, positioned at No 4 on the list, boasted 348 mb of storage across 196 facilities.

According to the 2024 Grain and Milling Annual published by Sosland, the capacities of the facilities involved in the transaction range from 125,000 bushels at Morris to 3.248 million bushels at Cheyenne Wells.

-      Progressive Farmer