MINNEAPOLIS, MINNESOTA, U.S. — CHS Inc. is organizing its system to be strong and efficient, with an eye toward positioning its member cooperatives and producer-owners for long-term success, Carl Casale, president and chief executive officer of CHS, told attendees at the company’s annual meeting, held Dec. 1-2 at the Minneapolis Convention Center in Minneapolis, Minnesota, U.S.

Carl Casale, president and chief executive officer of CHS.

“Since 2011, we’ve laid a strong foundation for the future,” Casale said. “We’ve made tremendous investments to serve you at home and to connect you to the global marketplace. Now we’re using our new market reality to make us better. We’re making sure our system is stronger and that we are more efficient.”

The two-day event, which carried the theme of “The Essentials,” included a review of fiscal 2016 results and highlights, along with official company business. The annual meeting also featured nearly four dozen educational sessions intended to provide business insights that help producers and their cooperatives succeed.

During the meeting, Casale told participants that he remains optimistic about the outlook for U.S. agriculture based on global population growth and food demand projections through the end of the 21st century.

“Cycles will always be with us, but as farmers, ranchers and the cooperatives who serve them, we’ve got plenty of opportunity ahead,” he said.

Lower pre-tax earnings within the company’s Energy and Ag segments contributed to a 46% decline in earnings at CHS, Inc. in fiscal 2016. Net income in the year ended Aug. 31 was $424.2 million, which compared with $781 million in fiscal 2015. CHS said lower pre-tax earnings within the Energy and Ag segments partly was offset by increased pre-tax earnings in its Foods segment, and seven months of earnings from its Nitrogen Production segment. The Nitrogen Production segment was created following the February 2016 strategic investment CHS made in CF Industries Nitrogen, LLC.

Revenues for the fiscal year were $30.3 billion, down 12% from $34.6 billion for fiscal 2015, primarily due to lower prices for the commodity energy, grains and fertilizer products that comprise much of the company’s business.

In reviewing fiscal 2016 results, Tim Skidmore, executive vice-president and chief financial officer, said the cooperative “remains financially sound, with a strong balance sheet, and positioned for future growth opportunities.”

He said that during fiscal 2017, based on fiscal 2016 results, CHS will return an estimated $337 million in cash to its owners in the form of cash patronage, equity redemptions to eligible members and dividends on preferred stock.

David Bielenberg, CHS’s board chairman and a farmer from Silverton, Oregon, U.S., told members that in down economic cycles it’s important to “be open to possibilities we may have overlooked and to focus on what’s most important.”

“We also recognize that we don’t have to go it alone,” Bielenberg said. “We can count on our cooperatives and their trusted teams to be there when we need them.”

CHS achieved several milestones during fiscal 2016, including:

• The completion of the company’s $2.8 billion strategic investment in CF Industries Nitrogen, LLC. The investment will create long-term supplies of patronage-eligible nitrogen fertilizer for its owners.

• A new coker came on line at the CHS refinery at McPherson, Kansas, U.S., allowing the refinery to process a larger variety of crude oils and deliver better value to owners and customers by using the more cost-effective crude oil. During fiscal 2017, completion of expansion projects at McPherson will bring the combined production of that refinery and a second at Laurel, Montana, U.S., to 155,000 barrels per day, CHS said.

• CHS Country Operations helped producer-owners deliver more value through collaboration by combining operations of eight of its business units and by expanding partnerships with cooperatives in Kansas and Alberta, Canada.

• The CHS canola processing plant at Hallock, Minnesota, U.S., exceeded expectations in its first year, further linking farmer-owners to added value in food and food ingredients.

• CHS Business Solutions invested in partnerships that support member-owners, including gaining 100% ownership of Russell Consulting, which provides financial and marketing advice, and offering The Land As Your Legacy to engage farm families in business transition planning.