INVER GROVE HEIGHTS, MINNESOTA, US — The coronavirus pandemic (COVID-19) significantly impacted Energy results for CHS, Inc., dragging first-quarter 2021 net income down to $69.7 million, which compared with $177.9 million a year ago.
Revenues for the quarter, which ended Nov. 30, 2020, increased to $8.7 billion from $7.6 billion in 2020.
Impacts in the Energy segment included exceptionally low crack spreads and other unfavorable market conditions in refined fuels driven primarily by COVID-19. CHS also saw a decrease in propane demand due to the warmer and drier fall weather.
The Energy segment sustained a loss of $67.17 million compared to earnings of $162.15 million a year ago.
Favorable weather conditions during fall harvest drove increased volumes and margins across much of CHS’ Ag segment. Improved relations between the US and foreign trading partners also drove increased volumes and margins for grain and oilseed.
“Our employees’ commitment throughout the first quarter allowed us to consistently deliver products and services to our owners and customers around the world,” said Jay Debertin, president and chief executive officer of CHS Inc. “A good growing season led to a good harvest season, and we saw commodity price rallies from spring and summer carry into fall. Those good weather conditions led to the highest volume fall fertilizer season we’ve seen since 2013 despite volatility in the nitrogen and phosphate markets.”
The Ag segment reported net income of $83 million, which compared with a loss of $13.9 million in the same quarter a year ago.
“Improved trade opportunities with China and improved trade activity in Europe and Africa helped drive first-quarter improvement in our global grain business,” Debertin said. “Our animal nutrition volumes also saw growth in the first quarter of fiscal year 2021.
“Throughout the remainder of our fiscal year, we will remain focused on our key priorities, including protecting the financial health of CHS, caring for those who depend on us and bringing efficiencies to how we run our businesses and deliver products.”