CHS, Consumer Supply form livestock feed venture

by World Grain Staff
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ST. PAUL, MINNESOTA, U.S. — CHS Inc. and Iowa-based Consumers Supply Distributing Co., announced on Feb. 13 that they will form a livestock and pet food manufacturing and wholesale distribution company.

The new entity will be called Consumers Supply Distributing, LLC, and will be based at Sioux City, Iowa, U.S.  It will offer the CHS Payback livestock and Equis horse feed brands, along with the broad range of livestock and companion animal products currently carried by Consumers Supply Distributing, including its Running Horse brand equine feed and Ranchers Choice and Country Vet brand pet foods and treats.

"This is an outstanding opportunity to combine two strong, high quality feed organizations to meet the livestock and companion animal nutrition needs of our current customers, as well as position this business for growth," said Rod Paulson, general manager, CHS Nutrition.

David Patee, owner and operator of Consumers Supply Distributing, said partnering with CHS "allows us to expand our business with an established feed company with a growing presence throughout the central and northwest U.S."

Patee will serve as the new limited liability company's manager.

Paulson said the new entity allows CHS to enter the pet food manufacturing sector and to gain greater distribution efficiencies and economies of scale. CHS Nutrition currently operates 11 feed manufacturing plants — along with a premix plant in Shenandoah, Iowa, U.S., and a liquid feed plant Marshall, Minnesota, U.S. — which serve the ration needs of all livestock species through its Payback and Equis brands. It also provides feed formulation and livestock leasing and risk management services. CHS will retain feed manufacturing and distribution operations independent of the new entity.

Consumers Supply Co., a wholesale distributor of agricultural and animal nutrition products since 1956, serves the livestock industry with feed ingredients, amino acids, pharmaceuticals, premixes and specialty products. It operates out of more than 310,000-square-feet of storage space at Sioux City and Cedar Rapids, Iowa, U.S. It also operates a fleet of 53 semi tractors and 100 vans that provide weekly delivery service to 1,000 customers, including local cooperatives, feed manufacturers, farm store chains and large integrators.

CHS Nutrition, which will remain separate from the newly formed entity, will pay cash for its 50% ownership of the LLC. Consumers Supply Distributing will contribute its assets at its two Iowa locations. The LLC will have a six-person board of directors, with three representatives from each of the owners.



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