ST. PAUL, MINNESOTA, US — CHS, Inc., the largest farmer-owned cooperative in the United States, and Ulen, Minnesota, US-based cooperative West Central Ag Services have signed a nonbinding letter of intent for West Central Ag to join CHS.

CHS said the transaction with West Central Ag Services aligns with strategic investments for CHS to grow the global agricultural supply chain while providing end-to-end value and enhanced market access for the cooperative system. Financial terms of the proposal announced May 15 were not disclosed. The companies have begun due diligence on the proposal, which is subject to necessary approvals.

West Central Ag was founded in 2000 and operates four grain, nine agronomy and one service shop locations with 132 full-time and 62-part time employees in northwest Minnesota. The cooperative reported $767.2 million in revenue and $41.2 million in profit in 2023 and has 22.5 million bushels of licensed grain storage. 

In 2009, West Central Ag formed a joined venture with CHS, which is called Central Plains Ag Services, to serve North Dakota farmers. 

“CHS and West Central Ag Services have a longstanding, strong relationship based on mutual trust and respect, as evidenced by our joint venture Central Plains Ag Services,” said Rick Dusek, executive vice president of ag retail, distribution and transportation at CHS. “Better connecting the global agriculture supply chain and investing in the speed and space of our assets provides better market access and creates more value for farmer owners.”

The proposal comes on the heels of CHS signing a letter of intent in mid-April to purchase eight grain assets in five states from Minneapolis, Minnesota, US-based global agribusiness Cargill.

CHS currently has 230 grain storage facilities, including 214 country elevators, and total licensed grain storage capacity of 403 million bushels, according to the Sosland Publishing Co.’s 2024 Grain & Milling Annual, making it the second-largest grain handling company in North America behind only ADM. In fiscal year 2023, CHS reported consolidated revenues of $45.6 billion and net income of $1.9 billion.

Duane Brendemuhl, board president and chair of West Central Ag, said the two cooperatives are aligned with a vision to advance the cooperative system by connecting producers to global markets.

“This proposed transaction provides an opportunity to bring more value to our farmer owners and compete more effectively with other local ag companies, while positioning us for the future success of a combined cooperative through efficient, globally connected supply chains,” Brendemuhl said.