CHS Inc. reported net earnings attributable to CHS of $120 million on sales of $6.2 billion for the first quarter ending Nov. 30, 2009, versus the year-ago $137.3 million and $7.7 billion. Net income was $122.5 million, versus the year-ago $159.4 million.

The Ag Business segment, which includes crop nutrients, reported first-quarter income before income taxes of $91.7 million on sales of $3.74 billion for the quarter, up from the year-ago $19.8 million and $4.95 billion.

CHS said that while wholesale crop nutrient revenue was down in the first quarter, earnings were up by $39.5 million. Revenues from this unit dropped some $352.2 million, or 56 percent, during the quarter, to $281.1 million from the year-ago $633.6 million. Of the drop, some $309.4 million was due to decreased average fertilizer selling prices, while $43.1 million was due to decreased volumes. The average fertilizer price decline was a whopping $348 per ton, or 52 percent. Volumes were off only 7 percent.

The unit was in the plus column for the first quarter. CHS did not list actual operating income from CHS wholesale crop nutrients; however, once the cost of goods for the quarter is subtracted – $268.2 million from sales of $281.1 million – the result is $12.9 million. For the year-ago period, cost of sales were $656.2 million on sales of $633.6 million, for a negative $22.6 million. CHS also took a $56.8 million writedown on market adjustments for crop nutrients for the year-ago quarter, which was part of an overall $84.1 million adjustment (GM Jan. 19, 2009). CHS confirmed year-ago crop nutrient loss for the unit and attributed it mainly to the writedown.

CHS country operations earnings, which include grain elevators and retail centers, were up by $7.2 million in the first quarter. CHS cited higher grain volumes, acquisitions, and improved crop nutrient margins for this increase.

As of Nov. 30, 2009, CHS crop nutrient inventories were valued at $112.4 million, versus the year-ago $346.7 million. They were valued at $114.8 million as of Aug. 31, 2009. Also as of Nov. 30, CHS had 909,000 st of product under purchase contract and 804,000 st under sales contracts.

As of Dec. 31, 2009, CHS noted that Agriliance LLC had sold most of its assets, with no sales contracts pending. Major assets still to be sold included some in Florida associated with its ProSource One specialty agriculture business.

During the first quarter ending Nov. 30, CHS received $40 million as cash distribution from Agriliance as a return of capital, primarily from the sale of ag retail outlets. It received another $30 million in December 2009.

The CHS Processing segment saw a turnaround in the first quarter, with income before income taxes of $30.8 million, up from a year-ago loss of $52.7 million. Energy saw a huge drop, to $14.3 million from the year-ago $206.8 million.

The Shoshone-Bannock Tribes have filed a lawsuit in federal court against the U.S. Department of the Interior and the Bureau of Land Management to halt a government land swap with J.R. Simplot Co., which the tribes contend could lead to greater pollution and poor air quality.

The suit was filed Jan. 6 in Boise’s U.S. District Court. Simplot spokesman David Cuoio told Green Markets the company preferred not to comment.

In 2007, Interior and BLM approved the transaction, which would trade about 680 acres of Simplot-owned key mule deer winter range near Blackrock Canyon south of Pocatello for about 720 acres of BLM property in the Trail Creek area near Simplot’s Don phosphate fertilizer complex.

Simplot wants to use the land to expand its gypsum stack, formed after phosphate is removed from slurry pumped from the company’s Smoky Canyon Mine about 90 miles to the east of the Caribou-Targhee National Forest near Wyoming. In the past, company officials have said the Don plant’s long-term viability depends on the company’s ability to handle the gypsum.

The tribes argue federal regulations were not properly followed when the government approved the swap, and that increasing the gypsum stack would degrade air quality and pollute the nearby Portneuf River, which runs through the Fort Hall Indian Reservation.

The Simplot plant and the adjacent former FMC elemental phosphorus plant are on the U.S. Environmental Protection Agency’s (EPA) Michaud Flats Superfund site, so designated because of heavy metals, arsenic, and other industrial-related contaminants.

EPA says phosphogypsum is a radioactive waste product created when phosphate ore is processed. When it decays, phosphogypsum forms radon, a radioactive gas that can cause cancer.

In 2009, federal environmental regulators began pressuring Simplot to do more at its fertilizer plant to stem the flow of phosphates and other pollutants into groundwater and streams. The tribes say they have the right to sue because the Simplot property is next to their land and part of their aboriginal homelands.

Simplot acquired the 680 acres near Blackrock Canyon in the early 1990s. Much of the BLM’s Trail Creek acreage was charred in June 2007 by a wildfire. The BLM hosted a public scoping meeting for public comment about the land swap. BLM officials said the land exchange and environmental concerns are separate issues. They said BLM is commissioned to ensure the land it gets from Simplot is of equal value to, or more than, the Trail Creek area property.

Major fertilizer industry players last week were busy providing aid to the victims of the earthquake in Haiti. PotashCorp told Green Markets on Jan. 14 that it would be giving $500,000, with $250,000 going to CARE Canada and $250,000 to the Canadian Red Cross. A company spokesman said there was a possibility that the Canadian government would be matching company donations.

The Mosaic Co. said on Jan. 15 that it will provide a $500,000 contribution, which will include both immediate and long-term assistance, supporting emergency medical services, triage, and mobile communications. Mosaic will contribute $125,000 to each of the following four organizations: Canadian Red Cross, American Refugee Committee, American Red Cross, and International Red Cross. The company also said it will match contributions for each of its 7,400 global employees to relief organizations working to rebuild Haiti.

“As a global company whose mission is to help the world grow the food it needs, our employees everywhere share a great concern for the Haitian people,” said Jim Prokopanko, Mosaic’s president and CEO. “We are partnering with relief organizations that are making an immediate impact, as well as providing a long-term commitment to rebuilding Haiti.”

Cargill Inc., which owns about two-thirds of Mosaic, said it was making an initial corporate donation of $50,000 that will be directed to long-time Cargill partners CARE and the World Food Programme, which have significant operations in the country.

In the Twin Cities, Cargill volunteers at its headquarters facility will be packaging 20,000 meals on Jan. 18 for the nonprofit Kids Against Hunger, which will be sent directly to people in Haiti. Cargill volunteers will be packaging an additional 30,000 meals over the next month.

While Cargill said it has no facilities in Haiti, it does have customers in the country.

Agrium Inc. said it would be supporting relief efforts by funding food through an organization called Friends of the World Food Program. Agrium has donated $20,000.

Industry players also made major donations to tsunami relief efforts some five years ago (GM Jan. 17, 2005).

The USDA on Jan. 12 projected U.S. corn production for 2009 at a record 13.2 billion bushels, up from the 12.9 billion bushels projected in their previous forecast, and 1 percent above the previous record of 13.0 billion bushels set in 2007.

Corn exports were projected at 2.1 billion bushels, unchanged from last month and up from the estimated 1.9 billion bushels exported in 2008/2009. USDA’s 2009 crop production summary estimated U.S. corn yield at a record 165.2 bushels/acre in 2009, up 2.3 bushels from the November forecast, and 4.9 bushels above the previous record of 160.3 bu/a set in 2004.

USDA said soybean production in 2009 also set a record at 3.36 billion bushels, up 1 percent from the Nov. 1 forecast and up 13 percent from 2008. The average soybean yield was estimated at a record high 44 bu/a, 0.7 bushel above the November forecast and 4.3 bushels above 2008’s yield. Harvested soybean area was up 2 percent from 2008, to a record 76.4 million acres.

The record corn and soybean projections came in spite of what USDA noted were below-normal temperatures across much of the Cornbelt in July and the “wet field conditions and high moisture levels” that growers battled throughout the fall harvest season.

The bullish estimates stunned the commodity markets and most analysts, and caused crop prices to plummet in the wake of the report’s release. Many analysts had predicted drops in production due to the wet fall and the acreage that remains unharvested as a result. Some analysts just prior to the Jan. 12 crop production report said the recent heavy snows in the Midwest could cause as much as 100 million bushels of the 2009 corn crop to be lost.

Regionally, USDA said estimated corn yields were at record high levels across much of the Cornbelt, Great Plains, and Ohio Valley. The mild temperatures through much of the growing season, combined with adequate soil moisture, provided favorable growing conditions and grain development. Record yields were also estimated for much of the upper Rocky Mountain Region, as well as the Pacific Northwest. Yields were estimated lower in the Delta, however, due to delayed spring planting and excessive moisture during harvest.

Soybean yields were up or unchanged from last year in all states except Arkansas, Illinois, Mississippi, New York, and South Carolina. Despite the soybean crop developing at a slower pace than normal for most of the growing season, USDA said conditions were generally good as most growing regions received ample moisture. The largest yield increases occurred in Delaware, Kentucky, Maryland, New Jersey, Ohio, and Tennessee, where yields jumped by more than 10 bushels from last year, when extreme heat late in the 2008 growing season reduced yields. New record high yields were set in Alabama, Georgia, Kansas, Kentucky, Nebraska, Ohio, and Tennessee.

As for other crops, all cotton production was estimated at 12.4 million 480-pound bales, down 2 percent from the previous forecast and down 3 percent from 2008. The U.S. cotton yield was estimated at 774 pounds/acre, down 8 pounds from the Dec. 1 forecast and down 39 pounds from last year. Harvested cotton area, at 7.69 million acres, was down less than 1 percent from December, but up 2 percent from last year.

Rice production in 2009 was estimated at 220 million cwt, up 1 percent from the previous forecast and up 8 percent from 2008. Total area planted to rice was estimated at 3.14 million acres, up 5 percent from 2008. The area harvested, at 3.10 million acres, was up slightly from the previous forecast and up 4 percent from 2008. The average yield for all U.S. rice was estimated at 7,085 pounds/acre, up 47 pounds from the previous forecast, and 239 pounds above the 2008 yield.

All wheat production totaled 2.22 billion bushels in 2009, down 11 percent from 2008. Grain area was pegged at 49.9 million acres, down 10 percent from last year. The average U.S. wheat yield was 44.4 bu/a, down 0.5 bushel from last year.

Sorghum grain production in 2009 was estimated at 383 million bushels, up 5 percent from the Nov. 1 forecast, but 19 percent below 2008. Total area planted was estimated at 6.63 million acres, down 20 percent from last year and the third lowest acreage total on record. Total area harvested for grain, at 5.52 million acres, was down 24 percent from 2008. Average grain yield, at 69.4 bu/a, was up 5.4 bushels from the previous forecast and up 4.4 bushels from 2008.