American Crystal CEO to retire in 2016
MOORHEAD, Minn. - David Berg, president and CEO of American Crystal Sugar Co., will retire next year, according to sources. He broke the news to shareholders earlier this year and company spokesman Jeff Schweitzer confirmed Wednesday that Berg pl...
MOORHEAD, Minn. – David Berg, president and CEO of American Crystal Sugar Co., will retire next year, according to sources.
He broke the news to shareholders earlier this year and company spokesman Jeff Schweitzer confirmed Wednesday that Berg plans to retire in eight months.
But Schweitzer said in an email that the CEO doesn't want to talk about it publicly. "He is very much in charge of American Crystal Sugar Company and does not want to prematurely draw attention to the fact he will retire in the future."
Berg, 61, has been at the sugar beet cooperative's top posts since March 2007 when the board of directors voted to hire him. His tenure will rival or exceed that of his predecessor, James Horvath, who was at the helm for a record nine years.
David Kragnes, a Felton farmer who was board chairman when Berg was hired, said Berg has a gift for connecting and communicating with shareholders. "Farmers are used to being autonomous CEOs on their own farms so for them to get together and agree on something on how a business should move forward is sometimes a challenge. He was successful in bringing clarity to the needs and bringing clarity to the process and move American Crystal forward."
But Berg was also a central figure in one of the most divisive labor disputes in the co-op's history. Under his leadership, American Crystal locked out its workers for nearly two years. When they returned after grudgingly approving a labor contract, the company felt it necessary to warn them not to harass nonunion workers or the families of those workers.
The Bakery, Confectionary, Tobacco Workers and Grain Millers International Union was asked to comment for this story, but no one was immediately available Wednesday.
Berg began his career as a communicator. After graduating from Minnesota State University Moorhead, he went to work as a TV reporter at WDAY. While interviewing an official at North Dakota State University about grain transportation, he confessed that he'd rather be involved in agriculture than reporting about it. The official encouraged him to study agriculture economics at the university, which he did.
Berg began working for American Crystal as an economic research manager in 1987 and moved up the ranks to chief operations officer in 2004.
During his tenure. the cooperative saw ups and downs, often on events out of its control. In 2010, high sugar prices and high sugar content led to record payments of $73 a ton for co-op members. That was the year before the labor unrest. By 2013, payments had plummeted to $38 a ton because prices were low and sugar content was also low. American Crystal defaulted on a $71.2 million government loan that year, forfeiting sugar it put up as collateral.
This year's payment is estimated to be $45 a ton.
Throughout Berg's tenure, American Crystal faced other external problems such as proposals to end the sugar program, which the industry believes would destabilize sugar prices; imports from Mexico; and massive rail delays that forced the co-op to slow down production at some factories.
But American Crystal was best known to the public during Berg's tenure for an internal problem: unhappy workers. Unionized workers complained that the co-op was offering a contract that would more than double the maximum out-of-pocket costs of health care for families. The Baker's Union framed the issue as corporate greed undermining working families, pointing to high profits and high compensation for executives like Berg.
Berg said during the dispute that compensation waxes and wanes with the co-op's fortunes. His job, he said, is to protect shareholder values, and that included negotiating a contract that kept up with health care trends.
Kragnes said he thinks Berg will leave a healthy co-op behind. "I think he has helped take the company where the growers wanted to be and where the circumstances would allow it to go."
American Crystal, with headquarters in Moorhead, is owned by about 2,800 sugar beet growers in the Red River Valley, employing 1,400 full-time workers. It owns six beet-processing plants in the valley, including the one in Moorhead, and another plant in Montana through a subsidiary.