Weather Forecast



North Central Farmers Elevator, Wheat Growers to merge

ABERDEEN, S.D. — The member-owners of North Central Farmers Elevator of Ipswich, S.D., and South Dakota Wheat Growers of Aberdeen, S.D., on Sept. 28 finished a vote to approve the unification of the two cooperatives.

The North Central Farmers Elevator members voted for the proposed unification 911-657, or 58 percent, and "Wheat Growers" members voted for the proposed unification,1598-954, with a 63 percent majority, according to a joint news release.

With this vote, the new cooperative is expected to begin operations effective Feb. 1, 2018. Until then, the cooperatives will operate independently. The co-ops now will focus on integration, including identifying a new corporate name.


"We listened to our members and it was based on their comments that we brought this to a vote of the membership," said Rick Osterday, North Central Farmers Elevator Board President. "We're pleased that they concluded that the unification of both cooperatives can bring additional value to members and ensure the long-term relevance and viability of a unified cooperative. We want to thank them for their support and participation in this important part of cooperative governance."

"This is a merger of two financially strong, legacy-rich cooperatives," said Wheat Growers Board President Hal Clemensen. "Our mission now is to seize this opportunity to build a new, even stronger cooperative better able to serve our member-owners. As we go forward, we will create new efficiencies, take advantage of new technologies and continue to build a strong employee team — all in order to create more value for our members."

The member voting period began Aug. 29 and followed a series of member information meetings since Aug. 21. Members cast their ballots through Sept. 28, for separate final meetings and forums. All ballots submitted were verified by Eide Bailly, the third-party audit firm administering the vote.

Tout savings

The co-ops had said the two entities could save $12.7 million annually over the coming four years, for a savings of $50.8 million over four years.

Greg Smith, a spokesman for Wheat Growers, told Agweek that potential savings had increased from the four-year estimate of $44 million that was made two years ago, when a merger was proposed. The annual savings for different units was $4.6 million for agronomy, $3.7 million for grain, $2.9 million for operations, $800,000 for energy and $700,000 for administration.

Smith said some critics of the move had indicated they didn't think bigger was necessarily bette, and that they wanted the competition between the two cooperatives. But Smith said the proponents argued that larger entities offer efficiencies and advantages in ordering transportation. He added that the real competition is between the co-op and larger entities like ADM or Cargill that operate internationally.

North Central Farmers Elevator is a full-service, farmer-owned cooperative, established in 1915 and headquartered in Ipswich, with 22 locations serving more than 2,400 member-owners in north central South Dakota and south central North Dakota.

South Dakota Wheat Growers is an innovative grain and agronomy cooperative established in 1923 and today serving more than 5,100 active member-owners in eastern North Dakota and South Dakota.