American Crystal sugar beet payments will be down because of bad growing season, low sugarThanks to miserable weather, profits from this fall’s sugar beet harvest won’t be nearly as sweet for American Crystal Sugar growers as last year.
By: Craig McEwen, The Forum
FARGO — Thanks to miserable weather, profits from this fall’s sugar beet harvest won’t be nearly as sweet for American Crystal Sugar growers as last year.
At its annual meeting Thursday at the Fargo Holiday Inn, the Moorhead-based cooperative reported net revenues for fiscal year 2009 totaling $1.20 billion for the crop planted in 2008.
The crop produced 10.3 million tons of sugar beets, or 25.4 tons per acre, with 17.6 percent sugar content.
“It (2008) was a much better year agronomically,” said American Crystal President and CEO David Berg. “The weather was much better. Our crop results were much better and therefore our payment per ton was much better.”
The company’s 3,000 shareholders earned $51.58 per ton from their 2008 crop. “It was the second-largest payment in the history of the company,” Berg said.
That’s the good news.
The bad news is that shareholders will bank only an estimated $40 per ton for sugar beets harvested this fall, Berg said.
This year’s crop averaged 22 tons per acre, with lower than average sugar content of 16.7 percent.
Growers earned more than $1,300 per acre from the 2008 crop compared to less than $900 per acre this year, Berg said.
“It’s a significant drop in revenue that is always spread around the Red River Valley,” Berg said. “We really believe that we are one of the strongest economic engines here. This year there’s going to be less fuel in that economic engine, I’m afraid.” The short 2009 growing season and early October freeze retarded sugar development, resulting in the second-lowest sugar content in 25 years and ultimately less revenue, Berg said.
While the previous year was “nicely profitable,” the 2009 crop year was “break even” for American Crystal growers, he said.
Anyone who raises sugar beets understands that the first thing you have to have behind you is weather, Berg said.
“This year, weather didn’t cooperate at all. Just about everything that could go wrong did go wrong.”
Sending letters to growers outlining projected revenue declines was disappointing, said Francis Kritzberger, retiring chairman of the American Crystal board of directors.
Kritzberger, Hillsboro, N.D., said 2009 was the most difficult year he has seen as a sugar beet farmer.
“We understand as farmers that we get paid for the crop that we raise,” he said. “We as farmers understand weather. We’re hoping for better next year.”
American Crystal operates processing plants in Moorhead, East Grand Forks, Crookston, Hillsboro, N.D., Drayton, N.D., and Sidney, Mont.