Wetness can’t dry Sugar’s profits

The politicians cooperated with American Crystal Sugar this year.

Fall weather was another story.

The Moorhead-based cooperative, which held its annual meeting Thursday in Fargo, reported fiscal year 2008 net revenue of $1.23 billion, up from $1.22 billion in 2007 and $1 billion in 2006.

Fiscal year 2008 reflects sugar beets harvested in 2007 and processed this year.

American Crystal harvested 11.6 million tons in 2007, trailing only the record 11.9 million tons a year earlier, said David Berg, the cooperative’s president and chief executive officer.

The 2007 crop enjoyed a strong sugar content of 18.06 percent, Berg said.

The outlook for fiscal year 2009 was hurt by heavy rains this fall, Berg said.

“A major negative factor this year is mud that plagued harvest operations and is hampering factory processing results,” he said.

Berg and Mike Astrup, a Dilworth farmer and American Crystal chairman, pointed to success in Washington, D.C., where Congress this year completed a new five-year farm bill.

The legislation will “help keep the U.S. sugar industry and American Crystal moving forward,” Berg said.

President-elect Barack Obama has indicated his support for the sugar industry, he said.

Berg said American Crystal expects to plant about 400,000 to 425,000 acres of sugar beets in 2009.

The cooperative planted 421,000 acres this year, down from 500,000 acres in 2007.

Reducing acreage isn’t an easy decision, Astrup said.

But yields are rising because of new, improved sugar beet varieties, and the cooperative’s ability to process and sell sugar hasn’t kept pace, he and Berg said.

The cooperative has about 2,900 shareholders and 2,000 employees.

It operates processing plants in Moorhead, East Grand Forks, Minn.; Crookston, Minn.; Hillsboro, N.D.; Drayton, N.D.; and Sidney, Mont.

Wahpeton, N.D.-based Minn-Dak Farmers Cooperative, the region’s other sugar beet cooperative, will hold its annual meeting Tuesday, also at the Holiday Inn in Fargo.