Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Nov. 30, 2013 | Mar. 31, 2013 | |
Document and Entity Information [Abstract] | ' | ' | ' |
Entity Registrant Name | 'Lincolnway Energy, LLC | ' | ' |
Entity Central Index Key | '0001350420 | ' | ' |
Current Fiscal Year End Date | '--09-30 | ' | ' |
Entity Filer Category | 'Non-accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 42,049 | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $37,492,143 |
Balance_Sheets_Statement
Balance Sheets Statement (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
CURRENT ASSETS | ' | ' |
Cash and cash equivalents | $1,936,800 | $151,824 |
Derivative financial instruments (Notes 9 and 10) | 431,476 | 71,978 |
Trade and other accounts receivable (Note 8) | 5,300,204 | 9,276,324 |
Inventories (Note 3) | 5,342,199 | 5,922,936 |
Prepaid expenses and other | 325,880 | 325,361 |
Total current assets | 13,336,559 | 15,748,423 |
PROPERTY AND EQUIPMENT | ' | ' |
Land and land improvements | 6,944,305 | 6,949,062 |
Buildings and improvements | 1,625,531 | 1,604,305 |
Plant and process equipment | 79,559,692 | 79,580,097 |
Construction in progress | 1,185,662 | 21,226 |
Office furniture and equipment | 409,730 | 405,188 |
Property, plant and equipment gross | 89,724,920 | 88,559,878 |
Accumulated depreciation | -58,859,269 | -51,313,592 |
Property, plant and equipment, net | 30,865,651 | 37,246,286 |
OTHER ASSETS | ' | ' |
Restricted cash (Note 6) | 351,000 | 351,000 |
Financing costs, net of amortization of $340,453 and $305,384 | 131,508 | 166,577 |
Deposit | 117,910 | 298,350 |
Investments | 196,102 | 190,488 |
Other assets, noncurrent | 796,520 | 1,006,415 |
Assets | 44,998,730 | 54,001,124 |
CURRENT LIABILITIES | ' | ' |
Accounts payable | 2,313,615 | 1,018,976 |
Accounts payable, related party (Note 7) | 554,478 | 829,067 |
Current maturities of long-term debt (Note 5) | 52,049 | 50,968 |
Current settlement payable, related party (Note 7) | 425,000 | 425,000 |
Revolving credit loan (Note 4) | 0 | 200,000 |
Accrued expenses | 999,460 | 896,744 |
Total current liabilities | 4,344,602 | 3,420,755 |
NONCURRENT LIABILITIES | ' | ' |
Long-term debt, less current maturities (Note 5) | 135,004 | 3,424,053 |
Settlement payable, net of current amount, related party (Note 7) | 850,000 | 1,275,000 |
Deferred revenue | 1,000,000 | 0 |
Other | 450,000 | 450,000 |
Total noncurrent liabilities | 2,435,004 | 5,149,053 |
COMMITMENTS AND CONTINGENCY (Notes 6, 8 and 12) | ' | ' |
MEMBERS’ EQUITY (Note 2) | ' | ' |
Member contributions, 42,049 units issued and outstanding | 38,990,105 | 38,990,105 |
Retained earnings (deficit) | -770,981 | 6,441,211 |
Members' Equity | 38,219,124 | 45,431,316 |
Liabilities and Members' Equity | $44,998,730 | $54,001,124 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
OTHER ASSETS | ' | ' |
Financing costs, net of amortization of | $340,453 | $305,384 |
MEMBER'S EQUITY | ' | ' |
units issued and outstanding | 42,049 | 42,049 |
Statements_of_Operations
Statements of Operations (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Revenues (Notes 1 and 8) | $182,469,541 | $169,567,374 | $173,951,126 |
Cost of goods sold (Notes 7 and 8) | 186,301,560 | 171,827,633 | 169,817,362 |
Gross profit (loss) | -3,832,019 | -2,260,259 | 4,133,764 |
General and administrative expenses | 3,224,382 | 2,955,565 | 2,649,796 |
(Gain) loss on sale or disposal of property and equipment (Note 13) | 0 | 489,664 | 0 |
Contract settlement fee (Note 7) | 0 | 1,700,000 | 0 |
Operating income (loss) | -7,056,401 | -6,426,160 | 1,483,968 |
Other income (expense): | ' | ' | ' |
Interest income | 4,277 | 6,957 | 9,542 |
Interest expense | -160,068 | -237,565 | -593,461 |
Other nonoperating income and expense | -155,791 | -230,608 | -583,919 |
Net income (loss) | ($7,212,192) | ($6,656,768) | $900,049 |
Weighted average units outstanding | 42,049 | 42,049 | 42,049 |
Net income (loss) per unit - basic and diluted | ($171.52) | ($158.31) | $21.40 |
Statements_of_Members_Equity
Statements of Members' Equity (USD $) | Total | Member Contributions | Retained Earnings(Deficit) |
Balance at Sep. 30, 2010 | $52,239,260 | $38,990,105 | $13,249,155 |
Increase (Decrease) in Partners' Capital [Roll Forward] | ' | ' | ' |
Member distributions | 0 | ' | ' |
Net income (loss) | 900,049 | ' | 900,049 |
Balance at Sep. 30, 2011 | 53,139,309 | 38,990,105 | 14,149,204 |
Increase (Decrease) in Partners' Capital [Roll Forward] | ' | ' | ' |
Member distributions | -1,051,225 | ' | 1,051,225 |
Net income (loss) | -6,656,768 | ' | -6,656,768 |
Balance at Sep. 30, 2012 | 45,431,316 | 38,990,105 | 6,441,211 |
Increase (Decrease) in Partners' Capital [Roll Forward] | ' | ' | ' |
Member distributions | 0 | ' | ' |
Net income (loss) | -7,212,192 | ' | -7,212,192 |
Balance at Sep. 30, 2013 | $38,219,124 | $38,990,105 | ($770,981) |
Statements_of_Members_Equity_P
Statements of Members' Equity (Parenthetical) (USD $) | 12 Months Ended |
Sep. 30, 2012 | |
Distribution per unit | $25 |
Statement_of_Cash_Flows
Statement of Cash Flows (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' | ' |
Net income (loss) | ($7,212,192) | ($6,656,768) | $900,049 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ' | ' | ' |
Depreciation and amortization | 7,760,954 | 7,850,854 | 8,232,529 |
(Gain) loss on sale or disposal of property and equipment | 0 | -489,664 | 62,696 |
Contract settlement fee | 0 | 1,700,000 | 0 |
Changes in working capital components: | ' | ' | ' |
Trade and other accounts receivable | 3,976,120 | -1,234,801 | -2,161,480 |
Inventories | 580,737 | 427,608 | -2,399,465 |
Prepaid expenses and other | -519 | 3,520 | -30,244 |
Deposits | 180,440 | 178,087 | -476,437 |
Accounts payable | 1,239,248 | -340,860 | 86,760 |
Accounts payable, related party | -274,589 | -350,914 | 719,023 |
Settlement fee payable, related party | -425,000 | 0 | 0 |
Accrued expenses | 20,638 | 17,512 | -172,428 |
Deferred revenue | 1,000,000 | 0 | 0 |
Derivative financial instruments | -359,498 | 448,067 | 593,783 |
Net cash provided by operating activities | 6,486,339 | 1,552,641 | 5,354,786 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' | ' |
Purchase of property and equipment | -1,207,781 | -1,041,800 | -2,870,231 |
Proceeds from sale of property | 0 | 1,181,000 | 0 |
Purchase of investments | -5,614 | -7,518 | -12,877 |
Net cash provided by (used in) investing activities | -1,213,395 | 131,682 | -2,883,108 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' | ' |
Member distributions | 0 | 1,051,225 | 0 |
Net proceeds (payments) from revolving credit loan | -200,000 | 200,000 | 0 |
Proceeds from long-term borrowings | 1,700,000 | 24,170,000 | 1,000,000 |
Payments on long-term borrowings | -4,987,968 | -24,885,409 | -6,295,653 |
Net cash (used in) financing activities | -3,487,968 | -1,566,634 | -5,295,653 |
Net increase (decrease) in cash and cash equivalents | 1,784,976 | 117,689 | -2,823,975 |
CASH AND CASH EQUIVALENTS | ' | ' | ' |
Beginning | 151,824 | 34,135 | 2,858,110 |
Ending | 1,936,800 | 151,824 | 34,135 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ' | ' | ' |
Cash paid for interest including capitalized interest 2013 none; 2012 none; 2011 $42,073 | 123,191 | 231,132 | 645,013 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES | ' | ' | ' |
Construction in progress included in accounts payable | 55,392 | 0 | 184,776 |
Construction in progress included in accrued expenses | $82,078 | $0 | $69,228 |
Statement_of_Cash_Flows_Parent
Statement of Cash Flows (Parenthetical) (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
SUPPLEMENT DISCLOSURE OF CASH FLOW INFORMATION, cash paid for interest including capitalized interest | $0 | $0 | $42,073 |
Nature_of_Business_and_Signifi
Nature of Business and Significant Accounting Policies | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Nature of Business and Significant Accounting Policies [Abstract] | ' | ||||||||||||
Business Description and Accounting Policies | ' | ||||||||||||
Nature of Business and Significant Accounting Policies | |||||||||||||
Principal business activity: Lincolnway Energy, LLC (the Company), located in Nevada, Iowa, was formed in May 2004 to pool investors to build a 50 million gallon annual production dry mill corn-based ethanol plant. The Company began making sales on May 30, 2006 and became operational during the quarter ended June 30, 2006. The Company is directly influenced by commodity markets and the agricultural and energy industries and, accordingly, its results of operations and financial condition may be significantly affected by cyclical market trends and the regulatory, political and economic conditions in these industries. | |||||||||||||
A summary of significant accounting policies follows: | |||||||||||||
Use of estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||||
Concentration of credit risk: The Company’s cash balances are maintained in bank deposit accounts which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts. | |||||||||||||
Cash and cash equivalents: For the purposes of reporting the statement of cash flows, the Company includes as cash equivalents all cash accounts and highly liquid debt instruments which are not subject to withdrawal restrictions or penalties. Certificates of deposit are considered investments as all have been purchased with maturities in excess of ninety days. Although the Company maintains its cash accounts in one bank, the Company believes it is not exposed to any significant credit risk on cash and cash equivalents. The Company has repurchase agreements with one bank, which totaled approximately $2,337,771 at September 30, 2013. In accordance with the terms of the repurchase agreements, the Company does not take possession of the related securities. The Company’s agreements also contain provisions to ensure that the market value of the underlying assets remain sufficient to protect the Company in the event of default by the banks by requiring that the underlying securities have a total market value of at least 100% of the bank’s total obligations under the agreements. | |||||||||||||
Trade accounts receivable: Trade accounts receivable are recorded at original invoice amounts less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considering customers financial condition, credit history and current economic conditions. Receivables are written off when deemed uncollectible. Recoveries of receivables written off are recorded when received. A receivable is considered past due if any portion of the receivable is outstanding more than 90 days. | |||||||||||||
Deferred revenue: Deferred revenue represents fees received under a service agreement in advance of services being performed. The related revenue is deferred and recognized as the services are performed over the term of the contract. | |||||||||||||
Inventories: Inventories are stated at the lower of cost or market using the first-in, first-out method. In the valuation of inventories and purchase and sale commitments, market is based on current replacement values except that it does not exceed net realizable values and is not less than net realizable values reduced by allowances for approximate normal profit margin. | |||||||||||||
Financing costs: Financing costs are recorded at cost and include expenditures directly related to securing debt financing. The Company is amortizing these costs using the effective interest method over the term of the agreement. The financing costs are included in interest expense on the statement of operations. | |||||||||||||
Property and equipment: Property and equipment is stated at cost. Construction in progress is comprised of costs related to the projects that are not completed. Depreciation is computed using the straight-line method over the following estimated useful lives: | |||||||||||||
Years | |||||||||||||
Land improvements | 20 | ||||||||||||
Buildings and improvements | 40 | ||||||||||||
Plant and process equipment | 5 – 20 | ||||||||||||
Office furniture and equipment | 3 – 7 | ||||||||||||
Maintenance and repairs are expensed as incurred; major improvements and betterments are capitalized. | |||||||||||||
Investments: The Company has investments in financial service cooperatives. These investments are carried at cost including allocated retained earnings of the cooperatives. | |||||||||||||
Derivative financial instruments: The Company periodically enters into derivative contracts to hedge the Company’s exposure to price risk related to forecasted corn needs, forward corn purchase contracts and ethanol sales. The Company does not typically enter into derivative instruments other than for hedging purposes. All the derivative contracts are recognized on the balance sheet at their fair market value. Although the Company believes its derivative positions are economic hedges, none have been designated as a hedge for accounting purposes. Accordingly, any realized or unrealized gain or loss related to corn derivatives is recorded in the statement of operations as a component of cost of goods sold. Any realized or unrealized gain or loss related to ethanol derivative instruments is recorded in the statement of operations as a component of revenue. The Company reports all contracts with the same counter party on a net basis on the balance sheet. | |||||||||||||
Deposit: The Internal Revenue Service (under Section 7519) requires partnerships that elect a fiscal year over a calendar year to make a deposit each year. The deposit is 25% of annual taxable net income, multiplied by the tax rate of 36% for the reporting fiscal year. | |||||||||||||
Revenue recognition: Revenue from the sale of the Company’s ethanol and distillers grains is recognized at the time title and all risks of ownership transfer to the customers. This generally occurs upon the loading of the product. For ethanol, title passes at the time the product crosses the loading flange in either a railcar or truck. For distiller’s grain, title passes upon the loading into trucks. For railcar shipments, this takes place when the railcar is filled and the marketer receives written notice that they have been loaded and are available for billing. Shipping and handling costs incurred by the Company for the sale of distiller’s grain are included in costs of goods sold. Ethanol revenue is reported free on board (FOB) and all shipping and handling costs are incurred by the ethanol marketer. For the years 2012 and 2011 freight for ethanol was included in costs of goods sold. Commissions for the marketing and sale of ethanol and distiller grains are included in costs of goods sold. | |||||||||||||
Revenue by product is as follows: | |||||||||||||
(Excludes hedging activity) | |||||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||||
Ethanol | $ | 133,228 | $ | 126,440 | $ | 139,536 | |||||||
Distiller's Grain | 45,047 | 38,564 | 31,716 | ||||||||||
Other | 4,182 | 4,570 | 3,826 | ||||||||||
Income taxes: The Company is organized as a partnership for federal and state income tax purposes and generally does not incur income taxes. Instead, the Company’s earnings and losses are included in the income tax returns of the members. Therefore, no provision or liability for federal or state income taxes has been included in these financial statements. Management has evaluated the Company's material tax positions and determined there were no uncertain tax positions that require adjustment to the financial statements. The Company does not currently anticipate significant changes in its uncertain tax positions over the next 12 months. Generally, the Company remains subject to income tax examinations by U.S. federal or state tax authorities for fiscal years 2010 and thereafter. | |||||||||||||
Earnings per unit: Basic and diluted earnings per unit have been computed on the basis of the weighted average number of units outstanding during each period presented. | |||||||||||||
Fair value of financial instruments: The carrying amounts of cash and cash equivalents, derivative financial instruments, trade and other accounts receivable, restricted cash, accounts payable and accrued expenses approximate fair value. The carrying amount of long-term debt approximates fair value because the interest rates are based on current rates offered to the Company for debt with similar terms and maturities. | |||||||||||||
Members_Equity
Members' Equity | 12 Months Ended |
Sep. 30, 2013 | |
Members' Equity [Abstract] | ' |
Members' Equity | ' |
Members' Equity | |
The Company was formed on May 19, 2004. It was initially capitalized by the issuance of 1,924 membership units totaling $962,000 to the founding members of the Company. The Company has one class of membership units. A majority of the Board of Directors owns a membership interest in the Company. The Company is authorized to issue up to 90,000 membership units without member approval. The membership approved an increase in authorized member units from 45,608 to 90,000 at the March 4, 2013 annual meeting. | |
Income and losses are allocated to all members based on their pro rata ownership interest. All unit transfers are effective the last day of the month. Units may be issued or transferred only to persons eligible to be members of the Company and only in compliance with the provisions of the operating agreement. | |
The Company is organized as an Iowa limited liability company. Members' liability is limited as specified in the Company's operating agreement and pursuant to the Iowa Limited Liability Company Act. The duration of the Company shall be perpetual unless dissolved as provided in the operating agreement. |
Inventories
Inventories | 12 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
Inventories consist of the following as of September 30, 2013 and 2012: | ||||||||
2013 | 2012 | |||||||
Raw materials, including corn, coal, chemicals and supplies | $ | 2,737,470 | $ | 2,048,130 | ||||
Work in process | 1,063,759 | 1,432,257 | ||||||
Ethanol and distillers grain | 1,540,970 | 2,442,549 | ||||||
Total | $ | 5,342,199 | $ | 5,922,936 | ||||
For the years ended September 30, 2013 and 2012, the Company recognized a reserve and resulting loss of none and $368,000, respectively, for a lower of cost or market inventory adjustment. |
Revolving_Credit_Loan
Revolving Credit Loan | 12 Months Ended |
Sep. 30, 2013 | |
Revolving Credit Loan [Abstract] | ' |
Revolving Credit Loan | ' |
Revolving Credit Loan | |
The Company entered into a new master loan agreement with a financial institution on August 21, 2012 and this agreement along with the following supplement was amended on April 17, 2013. One of the supplements of the agreement is a monitored revolving credit loan for up to $8,500,000. The amount available and outstanding under the loan cannot exceed the borrowing base as calculated per the agreement (approximately $5,200,000 as of September 30, 2013). The purpose of the loan is to finance inventory and receivables. The Company will pay interest monthly on the unpaid balance at a variable rate (adjusted on a weekly basis) based upon the one-month LIBOR index rate plus 3.75%. The Company will also pay a commitment fee on the average daily unused portion of the loan at the rate of .30% per annum, payable monthly. The term of the loan will expire, and the Company must pay all unpaid principal amounts outstanding under the loan, on June 1, 2014. The loan is secured by substantially all assets of the Company and subject to certain financial and nonfinancial covenants as defined in the master loan agreement. The outstanding balance as of September 30, 2013 and 2012 was none and $200,000, respectively. |
LongTerm_Debt
Long-Term Debt | 12 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Long-term Debt, Current and Noncurrent [Abstract] | ' | |||||||
Long-term Debt | ' | |||||||
Long-Term Debt | ||||||||
Long-term debt consists of the following as of September 30, 2013 and 2012 | ||||||||
2013 | 2012 | |||||||
Revolving term loan. (A) | $ | — | $ | 3,237,000 | ||||
Note payable to Iowa Department of Transportation. (B) | 187,053 | 238,021 | ||||||
187,053 | 3,475,021 | |||||||
Less current maturities | (52,049 | ) | (50,968 | ) | ||||
$ | 135,004 | $ | 3,424,053 | |||||
Maturities of long-term debt as of September 30, 2013 are as follows: | ||||||||
Years ending September 30: | ||||||||
2014 | $ | 52,049 | ||||||
2015 | 53,153 | |||||||
2016 | 54,281 | |||||||
2017 | 27,570 | |||||||
$ | 187,053 | |||||||
(A) | The Company entered into a new master loan agreement with a financial institution on August 21, 2012 and this agreement along with the following supplement was amended on April 17, 2013. One of the supplements of the agreement is a revolving term loan available for up to $11,000,000. The revolving term loan is to provide working capital to the Company and to finance construction projects related to conversion to natural gas. The Company will pay interest on the unpaid balance at a variable interest rate (adjusted on a weekly basis) based upon the one-month LIBOR index rate plus 4.00%. The Company will also pay a commitment fee on the average daily unused portion of the loan at the rate of .60% per annum, payable monthly. The loan is secured by substantially all assets of the Company and subject to certain financial and nonfinancial covenants as defined in the master loan agreement. The term of the loan will expire, and the Company must pay all unpaid principal amounts outstanding under the revolving term loan, on November 1, 2019. | |||||||
(B) | The Company entered into a $500,000 loan agreement with the Iowa Department of Transportation (IDOT) in February 2005. The proceeds were disbursed upon submission of paid invoices. Interest at 2.11% began accruing on January 1, 2007. Principal payments will be due semiannually through July 2016. The loan is secured by all rail track material constructed as part of the plant construction. The debt is subordinate to the above financial institution revolving term loan (A) and revolving credit loan (Note 4.) |
Lease_Commitments
Lease Commitments | 12 Months Ended | |||
Sep. 30, 2013 | ||||
Leases [Abstract] | ' | |||
Leases of Lessee Disclosure [Text Block] | ' | |||
Lease Commitments | ||||
The Company entered into a lease agreement with an unrelated third party to lease 90 hopper rail cars for the purpose of transporting distiller’s grain. The five-year term of the lease commenced March 2006 and ended March 2011. On March 26, 2011 the Company extended this lease with a rider. The rider calls for monthly payments of $56,700 plus applicable taxes. There was also an additional usage rental of 2.5 cents per mile for each car that exceeds 30,000 miles. The amendment that was made to the lease agreement on June 19, 2007, allowed the Company to purchase a certificate of deposit for $351,000 in lieu of the letter of credit that was required as partial security for the Company’s obligation under the lease. The Company has classified this certificate of deposit as restricted cash in other assets. The lease term on the rider is for three years commencing March 2011 and expiring March 2014. In conjunction with a change in the Company’s ethanol marketer, on September 21, 2009, the Company was assigned a lease that was previously between the Company’s previous ethanol marketer and an unrelated third party. The lease includes 100 tank rail cars for the purpose of transporting ethanol. The lease calls for monthly payments of $52,500 plus applicable taxes, beginning October 1, 2009. There is also an additional usage rental of 3 cents per mile for each car that exceeds 35,000 miles. The lease has an expiration date of September 2016. | ||||
On February 2, 2010, the Company entered into a lease agreement with an unrelated third party to lease an additional 30 ethanol tank rail cars. The one-year term of the lease ended on February 2011. On March 8, 2011 the Company extended this lease with two riders for 15 railcars each. Each rider calls for monthly payments of $9,750 plus applicable taxes. There was also an additional usage rental of 3 cents per mile for each car that exceeds 30,000 miles. The lease term on the riders is for three years commencing March 2011 and expiring March 2014. | ||||
The Company also leases office equipment and other equipment under operating leases that will expire at various dates through June 2015. | ||||
Approximate minimum lease payments under these operating leases for future years are as follows: | ||||
Years ending Sept 30: | ||||
2014 | $ | 1,075,000 | ||
2015 | 635,000 | |||
2016 | 630,000 | |||
$ | 2,340,000 | |||
Rent expense under the above operating leases totaled approximately, $1,816,000, $1,890,000 and $1,745,000 for the years ended September 30, 2013, 2012 and 2011, respectively. | ||||
RelatedParty_Transactions
Related-Party Transactions | 12 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
Related-Party Transactions | |
The Company entered into an agreement on January 24, 2006 with the Heart of Iowa Coop (HOIC), dba Key Cooperative, a member of the Company, to provide 100% of the requirement of corn for use in the operation of the ethanol plant. The agreement could be terminated before the end of the term by providing six months' notice of termination and paying the other party $2,000,000, reduced by $50,000 for each completed year of the agreement. | |
On April 10, 2012, the Company delivered notice to Key to terminate the Amended and Restated Grain Handling Agreement they held with Key. The termination of the agreement was six months from the date of notice, October 10, 2012. The Company recorded a termination cost of $1,700,000 as required under the agreement, which was expensed for the quarter ending June 30, 2012. Payments of $425,000 will be made annually over a four year period with interest at 3.25%, due on January 1 of each year. Interest expense paid to Key was $30,993, none and none for the years ended September 30, 2013, 2012 and 2011, respectively. | |
On January10, 2013, the Company began originating its own corn. | |
The Company purchased corn from Key totaling $85,648,581, $128,490,494 and $127,764,206 for the years ended September 30, 2013, 2012 and 2011, respectively. | |
As of September 30, 2013, the Company has a corn cash forward contract with Key that will be delivered in October 2013. The corn commitment is for $85,808. The Company also has a corn basis forward contract that will mature October 2013 and totals 51,000 bushels. The Company has made miscellaneous purchases from Key amounting to $76,068, $200,610 and $84,739 for the years ended September 30, 2013, 2012 and 2011, respectively. The 2012 purchases include $117,562 in grain storage fees. As of September 30, 2013 and 2012 the amount due to Key is $151,747 and $829,067, respectively. | |
For the years ended September 30, 2013, 2012 and 2011, the Company purchased corn totaling $6,523,278, none and none from Heartland Co-op, a member of the Company. The Company has a corn cash forward contract with Heartland Co-op that will be delivered in October 2013. The corn commitment is for $16,962. As of September 30, 2013 the amount due to Heartland Co-op is $67,687. | |
For the years ended September 30, 2013, 2012 and 2011, the Company purchased corn totaling $9,262,327, none and none from Mid Iowa Cooperative, a member of the Company. As of September 30, 2013, there is no amount due or corn commitments to Mid Iowa Cooperative. | |
The Company purchased corn from several other members totaling $4,982,894, none and none, respectively, for the years ended September 30, 2013, 2012 and 2011. As of September 30, 2013, the Company entered into several corn cash forward contracts with several members representing a corn commitment of $309,845. These contracts mature at various dates through March 2014. As of September 30, 2013 the amount due to other members is $334,415. | |
The Company is also purchasing propane and anhydrous ammonia from Innovative Ag Services (IAS), a member of the Company. Total purchases for the years ended September 30, 2013, 2012 and 2011 were $244,337, $170,878 and $16,402, respectively. As of September 30, 2013, the amount due to IAS is $629. |
Commitments_and_Major_Customer
Commitments and Major Customer and Subsequent Event | 12 Months Ended |
Sep. 30, 2013 | |
Commitments and Major Customer [Abstract] | ' |
Commitments and Major Customer and Subsequent Event | ' |
Commitments and Major Customers and Subsequent Event | |
On January 1, 2013 the Company entered into an agreement with an unrelated entity for marketing, selling and distributing all of the ethanol produced by the Company. Revenues with this customer were $99,214,531, none and none for the years ended September 30, 2013, 2012 and 2011. Trade accounts receivable of $3,413,190 and none was due from the customer as of September 30, 2013 and 2012, respectively. As of September 30, 2013, the Company has ethanol sales commitments with the unrelated entity of 14,273,500 gallons through March 2014. The sales price is approximately 8 cents under the monthly average OPIS-Chicago index price. | |
The Company had an agreement with an unrelated entity for marketing, selling and distributing all of the ethanol produced by the Company. This agreement ended December 31, 2012. Revenues with this customer were $34,012,975, $126,439,534 and $139,535,766 for the years ended September 30, 2013, 2012 and 2011, respectively. Trade accounts receivable of none and $6,778,356 was due from the customer as of September 30, 2013 and 2012 respectively. | |
The Company has entered into an agreement with an unrelated entity for marketing, selling and distributing the distiller’s grain as of October 1, 2007. Revenues with this customer were $45,047,371, $38,564,213 and $31,715,564 for the years ended September 30, 2013, 2012 and 2011, respectively. Trade accounts receivable of $1,435,105 and $2,064,496 was due from the customer as of September 30, 2013 and 2012, respectively. As of September 30, 2013, the Company has distiller’s grain sales commitments with the unrelated entity of approximately 52,590 tons for a total sales commitment of approximately $9,845,000 less marketing fees. Subsequent to year end, the Company and unrelated party mutually agreed to terminate the distiller's grain marketing agreement effective December 31, 2013. | |
The Company entered into an agreement on January 1, 2013 with an unrelated party to provide the coal supply for the ethanol plant. The agreement expires on January 1, 2015. The agreement is subject to a minimum purchase requirement. For the calendar year 2013 there is no outstanding commitment. For the calendar year 2014 the estimated purchase commitment totals $2,190,720. For the years ended September 30, 2013, 2012 and 2011, the Company has purchased coal of $7,720,923, $7,217,257 and $7,001,676 respectively. | |
The Company has entered into a variable contract with a supplier of denaturant. The variable contract is for a minimum purchase of 90,000 gallons at the average of the OPIS Conway In-Well Natural Gas price plus a specified basis per gallon. The term of the contract is from October 1, 2013 through October 31, 2013. The estimated future purchase commitment on this contract is approximately $196,470. | |
As of September 30, 2013, the Company had purchase commitments for corn cash forward contracts with various unrelated parties, at a corn commitment total of approximately, $1,130,625. These contracts mature at various dates through March 2014. | |
On April 17, 2013, the Company entered into a Main Extension and Gas Transportation Agreement with an unrelated party. The agreement is part of the Company's long-term plan to convert the energy source for its ethanol plant from coal to natural gas. The unrelated party will construct and own a pipeline that will be utilized to transport natural gas to the Company's ethanol plant. The total estimated cost of the construction of the gas pipeline to the Company is $3.6 million. The Company will pay that amount to the unrelated party through a monthly fee that is payable over a 10 year term of the Agreement. Completion of the pipeline is estimated to be the first quarter of calendar year 2015. | |
The Company also assigned a $3.1 million irrevocable standby letter of credit to the unrelated party to stand as security for the Company's obligation under the Agreement. The letter of credit will be reduced over time as the Company makes it payment under the Agreement. | |
Risk_Management
Risk Management | 12 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Risk Management [Abstract] | ' | |||||||||||
Derivative Instruments and Hedging Activities Disclosure | ' | |||||||||||
Risk Management | ||||||||||||
The Company’s activities expose it to a variety of market risks, including the effects of changes in commodity prices. These financial exposures are monitored and managed by the Company as an integral part of its overall risk management program. The Company’s risk management program focuses on the unpredictability of commodity markets and seeks to reduce the potentially adverse effects that the volatility of these markets may have on its operating results. | ||||||||||||
The Company maintains a risk management strategy that uses derivative instruments to minimize significant, unanticipated earnings fluctuations caused by market fluctuations. The Company’s specific goal is to protect the Company from large moves in the commodity costs. | ||||||||||||
To reduce price risk caused by market fluctuations, the Company generally follows a policy of using exchange-traded futures and options contracts to minimize its net position of merchandisable agricultural commodity inventories and forward purchases and sales contracts. | ||||||||||||
Exchange traded futures and options contracts are designated as non-hedge derivatives and are valued at market price with changes in market price recorded in operating income through cost of goods sold for corn derivatives and through revenue for ethanol derivatives. | ||||||||||||
Derivatives not designated as hedging instruments as of September 30, 2013 and 2012 are as follows: | ||||||||||||
2013 | 2012 | |||||||||||
Derivative assets - primarily corn contracts | $ | 193,060 | $ | 134,050 | ||||||||
Derivative liabilities - corn contracts | (394,699 | ) | — | |||||||||
Cash held by (due to) broker | 633,115 | (62,072 | ) | |||||||||
Total | $ | 431,476 | $ | 71,978 | ||||||||
The effects on operating income from derivative activities is as follows for the years ending September 30, are as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Increase (decrease) in revenue due to derivatives related to ethanol sales: | ||||||||||||
Realized | $ | — | $ | (7,308 | ) | $ | (2,655,034 | ) | ||||
Unrealized | 12,550 | — | 1,528,367 | |||||||||
Total effect on revenue | 12,550 | (7,308 | ) | (1,126,667 | ) | |||||||
(Increase) decrease in cost of goods sold due to derivatives related to corn costs: | ||||||||||||
Realized | 1,255,616 | (1,134,488 | ) | (2,946,138 | ) | |||||||
Unrealized | (214,189 | ) | 134,050 | (44,125 | ) | |||||||
Total effect on cost of goods sold | 1,041,427 | (1,000,438 | ) | (2,990,263 | ) | |||||||
Total (decrease) increase to operating income due to derivative activities | $ | 1,053,977 | $ | (1,007,746 | ) | $ | (4,116,930 | ) | ||||
Unrealized gains and losses on forward contracts, in which delivery has not occurred, are deemed “normal purchases and normal sales”, and therefore are not marked to market in the Company’s financial statements, but are subject to a lower of cost or market assessment. |
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Fair Value Measurements | ' | |||||||||||||||
Fair Value Measurements | ||||||||||||||||
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various methods including market, income and cost approaches. Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market-corroborated, or generally unobservable inputs. The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Based on the observability of the inputs used in the valuation techniques, the Company is required to provide the following information according to the fair value hierarchy. The fair value hierarchy ranks the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories: | ||||||||||||||||
Level 1 Valuations for assets and liabilities traded in active markets from readily available pricing sources for market transactions involving identical assets or liabilities. | ||||||||||||||||
Level 2Valuations for assets and liabilities traded in less active dealer or broker markets. Valuations are obtained from third-party pricing services for identical or similar assets or liabilities. | ||||||||||||||||
Level 3Valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities. | ||||||||||||||||
A description of the valuation methodologies used for instruments measured at fair value, including the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to all of the Company’s financial assets and financial liabilities carried at fair value. | ||||||||||||||||
Derivative financial instruments: Commodity futures and exchange-traded commodity options contracts are reported at fair value utilizing Level 1 inputs. For these contracts, the Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes and live trading levels from the CME and NYMEX markets. The fair value measurements consider observable data that may include dealer quotes and live trading levels from the over-the-counter markets. | ||||||||||||||||
The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2013 and 2012, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: | ||||||||||||||||
2013 | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets, derivative financial instruments | $ | 193,060 | $ | 193,060 | $ | — | $ | — | ||||||||
Liabilities, derivative financial instruments | $ | 394,699 | $ | 394,699 | ||||||||||||
2012 | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets, derivative financial instruments | $ | 134,050 | $ | 134,050 | $ | — | $ | — | ||||||||
Employee_Benefit_Plan
Employee Benefit Plan | 12 Months Ended |
Sep. 30, 2013 | |
Compensation and Retirement Disclosure [Abstract] | ' |
Employee Benefit Plan | ' |
Employee Benefit Plan | |
The Company adopted a 401(k) plan covering substantially all employees effective February 1, 2006. The Company provides matching contributions of 50% for up to 6% of employee compensation. Company contributions and plan expenses for the years ended September 30, 2013, 2012 and 2011 totaled $58,310, $72,360 and $65,495, respectively. |
Contingency
Contingency | 12 Months Ended |
Sep. 30, 2013 | |
Contingency [Abstract] | ' |
Legal Matters and Contingencies | ' |
Contingency | |
In May 2010, a lawsuit was filed against the Company and approximately twenty other ethanol plants, design firms and equipment manufacturers by an unrelated party claiming the Company’s operation of the corn oil extraction system is infringing at least one patent and that all parties have engaged in willful infringement. The plaintiff seeks injunctive relief, an award of damages with interest and any other remedies available under certain patent statutes or otherwise under law. The Company is currently defending the lawsuit with legal counsel and has asserted various defenses including that it does not infringe; that the patents are invalid; and/or that the patents are unenforceable. The Company is unable to determine at this time if the lawsuit will have a material adverse affect on the Company. |
Sale_of_Property
Sale of Property | 12 Months Ended |
Sep. 30, 2013 | |
Sale of Property [Abstract] | ' |
Sale of Property | ' |
Sale of Property | |
On October 5, 2011, the Company completed the sale of a land parcel adjacent to its primary site for a sales price of $1,181,000. A gain of $496,098 was recognized for the sale of property for the year ended September 30, 2012. | |
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Nature_of_Business_and_Signifi1
Nature of Business and Significant Accounting Policies (Policies) | 12 Months Ended | |
Sep. 30, 2013 | ||
Nature of Business and Significant Accounting Policies [Abstract] | ' | |
Use of estimates | ' | |
Use of estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | ||
Concentration of credit risk | ' | |
Concentration of credit risk: The Company’s cash balances are maintained in bank deposit accounts which at times may exceed federally insured limits. The Company has not experienced any losses in such accounts. | ||
Cash and cash equivalents | ' | |
Cash and cash equivalents: For the purposes of reporting the statement of cash flows, the Company includes as cash equivalents all cash accounts and highly liquid debt instruments which are not subject to withdrawal restrictions or penalties. Certificates of deposit are considered investments as all have been purchased with maturities in excess of ninety days. Although the Company maintains its cash accounts in one bank, the Company believes it is not exposed to any significant credit risk on cash and cash equivalents. The Company has repurchase agreements with one bank, which totaled approximately $2,337,771 at September 30, 2013. In accordance with the terms of the repurchase agreements, the Company does not take possession of the related securities. The Company’s agreements also contain provisions to ensure that the market value of the underlying assets remain sufficient to protect the Company in the event of default by the banks by requiring that the underlying securities have a total market value of at least 100% of the bank’s total obligations under the agreements. | ||
Trade accounts receivable | ' | |
Trade accounts receivable: Trade accounts receivable are recorded at original invoice amounts less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis. Management determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considering customers financial condition, credit history and current economic conditions. Receivables are written off when deemed uncollectible. Recoveries of receivables written off are recorded when received. A receivable is considered past due if any portion of the receivable is outstanding more than 90 days. | ||
Inventories | ' | |
Inventories: Inventories are stated at the lower of cost or market using the first-in, first-out method. In the valuation of inventories and purchase and sale commitments, market is based on current replacement values except that it does not exceed net realizable values and is not less than net realizable values reduced by allowances for approximate normal profit margin. | ||
Financing costs | ' | |
Financing costs: Financing costs are recorded at cost and include expenditures directly related to securing debt financing. The Company is amortizing these costs using the effective interest method over the term of the agreement. The financing costs are included in interest expense on the statement of operations. | ||
Property and equipment | ' | |
Property and equipment: Property and equipment is stated at cost. Construction in progress is comprised of costs related to the projects that are not completed. Depreciation is computed using the straight-line method over the following estimated useful lives: | ||
Years | ||
Land improvements | 20 | |
Buildings and improvements | 40 | |
Plant and process equipment | 5 – 20 | |
Office furniture and equipment | 3 – 7 | |
Maintenance and repairs are expensed as incurred; major improvements and betterments are capitalized. | ||
Investments | ' | |
Investments: The Company has investments in financial service cooperatives. These investments are carried at cost including allocated retained earnings of the cooperatives. | ||
Derivative financial instruments | ' | |
Derivative financial instruments: The Company periodically enters into derivative contracts to hedge the Company’s exposure to price risk related to forecasted corn needs, forward corn purchase contracts and ethanol sales. The Company does not typically enter into derivative instruments other than for hedging purposes. All the derivative contracts are recognized on the balance sheet at their fair market value. Although the Company believes its derivative positions are economic hedges, none have been designated as a hedge for accounting purposes. Accordingly, any realized or unrealized gain or loss related to corn derivatives is recorded in the statement of operations as a component of cost of goods sold. Any realized or unrealized gain or loss related to ethanol derivative instruments is recorded in the statement of operations as a component of revenue. The Company reports all contracts with the same counter party on a net basis on the balance sheet. | ||
Deposit | ' | |
Deposit: The Internal Revenue Service (under Section 7519) requires partnerships that elect a fiscal year over a calendar year to make a deposit each year. The deposit is 25% of annual taxable net income, multiplied by the tax rate of 36% for the reporting fiscal year. | ||
Revenue recognition | ' | |
Revenue recognition: Revenue from the sale of the Company’s ethanol and distillers grains is recognized at the time title and all risks of ownership transfer to the customers. This generally occurs upon the loading of the product. For ethanol, title passes at the time the product crosses the loading flange in either a railcar or truck. For distiller’s grain, title passes upon the loading into trucks. For railcar shipments, this takes place when the railcar is filled and the marketer receives written notice that they have been loaded and are available for billing. Shipping and handling costs incurred by the Company for the sale of distiller’s grain are included in costs of goods sold. Ethanol revenue is reported free on board (FOB) and all shipping and handling costs are incurred by the ethanol marketer. For the years 2012 and 2011 freight for ethanol was included in costs of goods sold. Commissions for the marketing and sale of ethanol and distiller grains are included in costs of goods sold. | ||
Income taxes | ' | |
Income taxes: The Company is organized as a partnership for federal and state income tax purposes and generally does not incur income taxes. Instead, the Company’s earnings and losses are included in the income tax returns of the members. Therefore, no provision or liability for federal or state income taxes has been included in these financial statements. Management has evaluated the Company's material tax positions and determined there were no uncertain tax positions that require adjustment to the financial statements. The Company does not currently anticipate significant changes in its uncertain tax positions over the next 12 months. Generally, the Company remains subject to income tax examinations by U.S. federal or state tax authorities for fiscal years 2010 and thereafter. | ||
Earnings per unit | ' | |
Earnings per unit: Basic and diluted earnings per unit have been computed on the basis of the weighted average number of units outstanding during each period presented. | ||
Fair value of financial instruments | ' | |
Fair value of financial instruments: The carrying amounts of cash and cash equivalents, derivative financial instruments, trade and other accounts receivable, restricted cash, accounts payable and accrued expenses approximate fair value. The carrying amount of long-term debt approximates fair value because the interest rates are based on current rates offered to the Company for debt with similar terms and maturities. |
Nature_of_Business_and_Signifi2
Nature of Business and Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Nature of Business and Significant Accounting Policies [Abstract] | ' | ||||||||||||
Schedule of Property and Equipment, Estimated Useful Lives | ' | ||||||||||||
Depreciation is computed using the straight-line method over the following estimated useful lives: | |||||||||||||
Years | |||||||||||||
Land improvements | 20 | ||||||||||||
Buildings and improvements | 40 | ||||||||||||
Plant and process equipment | 5 – 20 | ||||||||||||
Office furniture and equipment | 3 – 7 | ||||||||||||
Schedule of Revenue by Product | ' | ||||||||||||
Revenue by product is as follows: | |||||||||||||
(Excludes hedging activity) | |||||||||||||
(In thousands) | 2013 | 2012 | 2011 | ||||||||||
Ethanol | $ | 133,228 | $ | 126,440 | $ | 139,536 | |||||||
Distiller's Grain | 45,047 | 38,564 | 31,716 | ||||||||||
Other | 4,182 | 4,570 | 3,826 | ||||||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Schedule of Inventory, Current | ' | |||||||
Inventories consist of the following as of September 30, 2013 and 2012: | ||||||||
2013 | 2012 | |||||||
Raw materials, including corn, coal, chemicals and supplies | $ | 2,737,470 | $ | 2,048,130 | ||||
Work in process | 1,063,759 | 1,432,257 | ||||||
Ethanol and distillers grain | 1,540,970 | 2,442,549 | ||||||
Total | $ | 5,342,199 | $ | 5,922,936 | ||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 12 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Long-term Debt, Current and Noncurrent [Abstract] | ' | |||||||
Schedule of Long-term Debt Instruments | ' | |||||||
(A) | The Company entered into a new master loan agreement with a financial institution on August 21, 2012 and this agreement along with the following supplement was amended on April 17, 2013. One of the supplements of the agreement is a revolving term loan available for up to $11,000,000. The revolving term loan is to provide working capital to the Company and to finance construction projects related to conversion to natural gas. The Company will pay interest on the unpaid balance at a variable interest rate (adjusted on a weekly basis) based upon the one-month LIBOR index rate plus 4.00%. The Company will also pay a commitment fee on the average daily unused portion of the loan at the rate of .60% per annum, payable monthly. The loan is secured by substantially all assets of the Company and subject to certain financial and nonfinancial covenants as defined in the master loan agreement. The term of the loan will expire, and the Company must pay all unpaid principal amounts outstanding under the revolving term loan, on November 1, 2019. | |||||||
(B) | The Company entered into a $500,000 loan agreement with the Iowa Department of Transportation (IDOT) in February 2005. The proceeds were disbursed upon submission of paid invoices. Interest at 2.11% began accruing on January 1, 2007. Principal payments will be due semiannually through July 2016. The loan is secured by all rail track material constructed as part of the plant construction. The debt is subordinate to the above financial institution revolving term loan (A) and revolving credit loan (Note 4.) | |||||||
Long-term debt consists of the following as of September 30, 2013 and 2012 | ||||||||
2013 | 2012 | |||||||
Revolving term loan. (A) | $ | — | $ | 3,237,000 | ||||
Note payable to Iowa Department of Transportation. (B) | 187,053 | 238,021 | ||||||
187,053 | 3,475,021 | |||||||
Less current maturities | (52,049 | ) | (50,968 | ) | ||||
$ | 135,004 | $ | 3,424,053 | |||||
Schedule of Maturities of Long-term Debt | ' | |||||||
Maturities of long-term debt as of September 30, 2013 are as follows: | ||||||||
Years ending September 30: | ||||||||
2014 | $ | 52,049 | ||||||
2015 | 53,153 | |||||||
2016 | 54,281 | |||||||
2017 | 27,570 | |||||||
$ | 187,053 | |||||||
Lease_Commitments_Lease_Commit
Lease Commitments Lease Commitments (Tables) | 12 Months Ended | |||
Sep. 30, 2013 | ||||
Leases [Abstract] | ' | |||
Schedule of Future Minimum Rental Payments for Operating Leases | ' | |||
Approximate minimum lease payments under these operating leases for future years are as follows: | ||||
Years ending Sept 30: | ||||
2014 | $ | 1,075,000 | ||
2015 | 635,000 | |||
2016 | 630,000 | |||
$ | 2,340,000 | |||
Risk_Management_Tables
Risk Management (Tables) | 12 Months Ended | |||||||||||
Sep. 30, 2013 | ||||||||||||
Risk Management [Abstract] | ' | |||||||||||
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | ' | |||||||||||
Derivatives not designated as hedging instruments as of September 30, 2013 and 2012 are as follows: | ||||||||||||
2013 | 2012 | |||||||||||
Derivative assets - primarily corn contracts | $ | 193,060 | $ | 134,050 | ||||||||
Derivative liabilities - corn contracts | (394,699 | ) | — | |||||||||
Cash held by (due to) broker | 633,115 | (62,072 | ) | |||||||||
Total | $ | 431,476 | $ | 71,978 | ||||||||
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | ' | |||||||||||
The effects on operating income from derivative activities is as follows for the years ending September 30, are as follows: | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Increase (decrease) in revenue due to derivatives related to ethanol sales: | ||||||||||||
Realized | $ | — | $ | (7,308 | ) | $ | (2,655,034 | ) | ||||
Unrealized | 12,550 | — | 1,528,367 | |||||||||
Total effect on revenue | 12,550 | (7,308 | ) | (1,126,667 | ) | |||||||
(Increase) decrease in cost of goods sold due to derivatives related to corn costs: | ||||||||||||
Realized | 1,255,616 | (1,134,488 | ) | (2,946,138 | ) | |||||||
Unrealized | (214,189 | ) | 134,050 | (44,125 | ) | |||||||
Total effect on cost of goods sold | 1,041,427 | (1,000,438 | ) | (2,990,263 | ) | |||||||
Total (decrease) increase to operating income due to derivative activities | $ | 1,053,977 | $ | (1,007,746 | ) | $ | (4,116,930 | ) | ||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | ' | |||||||||||||||
The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2013 and 2012, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: | ||||||||||||||||
2013 | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets, derivative financial instruments | $ | 193,060 | $ | 193,060 | $ | — | $ | — | ||||||||
Liabilities, derivative financial instruments | $ | 394,699 | $ | 394,699 | ||||||||||||
2012 | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets, derivative financial instruments | $ | 134,050 | $ | 134,050 | $ | — | $ | — | ||||||||
Nature_of_Business_and_Signifi3
Nature of Business and Significant Accounting Policies Textuals (Details) (USD $) | 12 Months Ended |
Sep. 30, 2013 | |
gal | |
D | |
Product Information [Line Items] | ' |
Annual ethanol production | 50,000,000 |
Securities sold under agreements to repurchase | $2,337,771 |
Number of days outstanding for a past due trade receivables | 90 |
Nature_of_Business_and_Signifi4
Nature of Business and Significant Accounting Policies Property and Equipment (Details) | 12 Months Ended |
Sep. 30, 2013 | |
Land improvements [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '20 years |
Buildings and improvements [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '40 years |
Plant and process equipment [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '5 years |
Plant and process equipment [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '20 years |
Office furniture and equipment [Member] | Minimum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '3 years |
Office furniture and equipment [Member] | Maximum [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Property and equipment, useful life | '7 years |
Nature_of_Business_and_Signifi5
Nature of Business and Significant Accounting Policies Revenue by Product (Details) (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Revenue from External Customer [Line Items] | ' | ' | ' |
Revenues (Notes 1 and 8) | $182,469,541 | $169,567,374 | $173,951,126 |
Ethanol [Member] | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' |
Revenues (Notes 1 and 8) | 133,228,000 | 126,440,000 | 139,536,000 |
Distiller's Grain [Member] | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' |
Revenues (Notes 1 and 8) | 45,047,000 | 38,564,000 | 31,716,000 |
Other [Member] | ' | ' | ' |
Revenue from External Customer [Line Items] | ' | ' | ' |
Revenues (Notes 1 and 8) | $4,182,000 | $4,570,000 | $3,826,000 |
Members_Equity_Details
Members' Equity (Details) (USD $) | 0 Months Ended | 5 Months Ended | 7 Months Ended |
20-May-04 | Mar. 03, 2013 | Sep. 30, 2013 | |
Capital Unit [Line Items] | ' | ' | ' |
Sale of membership units (in units) | 1,924 | ' | ' |
Sale of membership units | $962,000 | ' | ' |
Authorized of membership units without member approval (in units) | ' | 45,608 | 90,000 |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
Inventory Disclosure [Abstract] | ' | ' |
Raw materials, including corn, coal, chemicals and supplies | $2,737,470 | $2,048,130 |
Work in process | 1,063,759 | 1,432,257 |
Ethanol and distillers grain | 1,540,970 | 2,442,549 |
Inventory total | 5,342,199 | 5,922,936 |
Inventory valuation reserves | $0 | $368,000 |
Revolving_Credit_Loan_Details
Revolving Credit Loan (Details) (USD $) | 0 Months Ended | |||
Nov. 08, 2012 | Aug. 20, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Line of Credit Facility [Line Items] | ' | ' | ' | ' |
Description of variable rate basis | 'LIBOR | ' | ' | ' |
Basis spread on variable rate | 4.00% | ' | ' | ' |
Line of credit facility, unused capacity, commitment fee percentage | ' | 0.60% | ' | ' |
Line of credit facility, amount outstanding | ' | ' | $0 | $200,000 |
Revolving Credit Loan [Member] | ' | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' | ' |
Line of credit facility, maximum borrowing capacity | ' | 8,500,000 | ' | ' |
Line of credit facility, current borrowing capacity | ' | 5,200,000 | ' | ' |
Description of variable rate basis | ' | 'LIBOR | ' | ' |
Basis spread on variable rate | ' | 3.75% | ' | ' |
Line of credit facility, unused capacity, commitment fee percentage | ' | 0.30% | ' | ' |
Line of credit facility, amount outstanding | ' | ' | $0 | $200,000 |
LongTerm_Debt_Details
Long-Term Debt (Details) (USD $) | 0 Months Ended | |||
Nov. 08, 2012 | Aug. 20, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Revolving term loan | $11,000,000 | ' | $0 | $3,237,000 |
Note payable to Iowa Department of Transportation | ' | ' | 187,053 | 238,021 |
Long-term debt, total | ' | ' | 187,053 | 3,475,021 |
Less current maturities | ' | ' | -52,049 | -50,968 |
Long-term debt, less current maturities | ' | ' | 135,004 | 3,424,053 |
Maturities of Long-term Debt [Abstract] | ' | ' | ' | ' |
2013 | ' | ' | 52,049 | ' |
2014 | ' | ' | 53,153 | ' |
2015 | ' | ' | 54,281 | ' |
2016 | ' | ' | 27,570 | ' |
Description of variable rate basis | 'LIBOR | ' | ' | ' |
Basis spread on variable rate | 4.00% | ' | ' | ' |
Line of credit facility, unused capacity, commitment fee percentage | ' | 0.60% | ' | ' |
Railroad revolving loan fund | ' | ' | $500,000 | ' |
Debt instrument, interest rate, stated percentage | ' | ' | 2.11% | ' |
Lease_Commitments_Details
Lease Commitments (Details) (USD $) | 12 Months Ended | ||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Jun. 19, 2007 | Sep. 30, 2013 | Mar. 26, 2011 | Mar. 08, 2011 | Feb. 02, 2010 | Sep. 21, 2009 | |
Hopper Rail Cars [Member] | Hopper Rail Cars [Member] | Tank Rail Cars [Member] | Tank Rail Cars [Member] | Tank Rail Cars [Member] | |||||
cars | mi | cars | cars | cars | |||||
mi | mi | ||||||||
Operating Leased Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of vehicles | ' | ' | ' | ' | 90 | ' | 15 | 30 | 100 |
Monthly lease payments | ' | ' | ' | ' | ' | $56,700 | $9,750 | ' | $52,500 |
Restricted cash | 351,000 | 351,000 | ' | 351,000 | ' | ' | ' | ' | ' |
Additional Rental Payments, Over Mileage Threshold | ' | ' | ' | ' | ' | 0.025 | 0.03 | ' | 0.03 |
Additional Rental Payments, Mileage Threshold | ' | ' | ' | ' | ' | 30,000 | 30,000 | ' | 35,000 |
Operating leases, rent expense | $1,816,000 | $1,890,000 | $1,745,000 | ' | ' | ' | ' | ' | ' |
Lease_Commitments_Fufutre_Oper
Lease Commitments Fufutre Operating Lease Commitments (Details) (USD $) | Sep. 30, 2013 |
Leases [Abstract] | ' |
2014 | $1,075,000 |
2015 | 635,000 |
2016 | 630,000 |
Total minimum lease payments, operating leases | $2,340,000 |
RelatedParty_Transactions_Deta
Related-Party Transactions (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
bu | ||||
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Contract settlement fee | ' | $0 | $1,700,000 | $0 |
Key Coop [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Related party transaction, description of transaction | ' | 100.00% | ' | ' |
Loss on contract termination | ' | 2,000,000 | ' | ' |
Reduction in termination fee | ' | 50,000 | ' | ' |
Contract settlement fee | 1,700,000 | ' | ' | ' |
Payment for contract settlement | 425,000 | ' | ' | ' |
Duration of contract (in years) | '4 years | ' | ' | ' |
Legal settlement, interest rate | 3.25% | ' | ' | ' |
Interest expense, related party | ' | ' | 30,993 | 0 |
Purchases from related party | ' | 85,648,581 | 128,490,494 | 127,764,206 |
Purchase commitment, remaining minimum amount committed | ' | 85,808 | ' | ' |
Corn basis forward contract | ' | 51,000 | ' | ' |
Related party transaction, amounts of transaction | ' | 76,068 | 200,610 | 84,739 |
Grain storage fees | ' | 117,562 | ' | ' |
Accounts payable, related parties, current | ' | 151,747 | 829,067 | ' |
Heartland [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Purchases from related party | ' | 6,523,278 | 0 | 0 |
Purchase commitment, remaining minimum amount committed | ' | 16,962 | ' | ' |
Accounts payable, related parties, current | ' | 67,687 | ' | ' |
Mid Iowa Cooperative [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Purchases from related party | ' | 9,262,327 | 0 | 0 |
Other Members [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Purchases from related party | ' | 4,982,894 | 0 | 0 |
Purchase commitment, remaining minimum amount committed | ' | 309,845 | ' | ' |
Accounts payable, related parties, current | ' | 334,415 | ' | ' |
Innovative Ag Services [Member] | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' |
Purchases from related party | ' | 244,337 | 170,878 | 16,402 |
Accounts payable, related parties, current | ' | $629 | ' | ' |
Commitments_and_Major_Customer1
Commitments and Major Customer and Subsequent Event (Details) (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Revenue, Major Customer [Line Items] | ' | ' | ' |
Revenues | $182,469,541 | $169,567,374 | $173,951,126 |
Ethanol Customer Two [Member] | ' | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' | ' |
Revenues | 99,214,531 | 0 | 0 |
Ethanol receivable | 3,413,190 | 0 | ' |
Sales commitments (in gallons or tons) | 14,273,500 | ' | ' |
Future sales commitment, price under OPIS index | 0.08 | ' | ' |
Ethanol Customer One [Member] | ' | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' | ' |
Revenues | 34,012,975 | 126,439,534 | 139,535,766 |
Ethanol receivable | 0 | 6,778,356 | ' |
Distiller's Grain [Member] | ' | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' | ' |
Revenues | 45,047,371 | 38,564,213 | 31,715,564 |
Distillers grains receivable | 1,435,105 | 2,064,496 | ' |
Supply commitment, future sales commitment tons | 52,590 | ' | ' |
Sales commitments | 9,845,000 | ' | ' |
Coal Contract [Member] | ' | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' | ' |
Sales commitments | $2,190,720 | ' | ' |
Commitments_and_Major_Customer2
Commitments and Major Customer and Subsequent Event Purchase Committments (Details) (USD $) | Apr. 17, 2013 | Apr. 17, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2013 |
Financial Standby Letter of Credit [Member] | Pipelines [Member] | Coal Contract [Member] | Coal Contract [Member] | Coal Contract [Member] | Denaturant [Member] | Forward Contracts [Member] | |
gal | |||||||
Long-term Purchase Commitment [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Sales commitments | ' | ' | $2,190,720 | ' | ' | ' | ' |
Payments to suppliers | ' | ' | 7,720,923 | 7,217,257 | 7,001,676 | ' | ' |
Long-term purchase commitment, minimum quantity required (in gallons) | ' | ' | ' | ' | ' | 90,000 | ' |
Long-term purchase commitment, amount | ' | ' | ' | ' | ' | 196,470 | 1,130,625 |
Estimated additions to property, plant and equipment | ' | 3,600,000 | ' | ' | ' | ' | ' |
Property, plant and equipment, additions, term of contract | ' | '10 years | ' | ' | ' | ' | ' |
Guarantor obligations, current carrying value | $3,100,000 | ' | ' | ' | ' | ' | ' |
Risk_Management_Details
Risk Management (Details) (USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Total | $431,476 | $71,978 | ' |
Trading Activity, Gains and Losses, Net | 1,053,977 | -1,007,746 | -4,116,930 |
Sales [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Trading Activity, Gains and Losses, Net | 12,550 | -7,308 | -1,126,667 |
Cost of Goods, Total [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Trading Activity, Gains and Losses, Net | 1,041,427 | -1,000,438 | -2,990,263 |
Gain (Loss) on Settlement of Derivative Instrument [Member] | Sales [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Trading Activity, Gains and Losses, Net | 0 | -7,308 | -2,655,034 |
Gain (Loss) on Settlement of Derivative Instrument [Member] | Cost of Goods, Total [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Trading Activity, Gains and Losses, Net | 1,255,616 | -1,134,488 | -2,946,138 |
Unrealized Gain (Loss or Write-down) [Member] | Sales [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Trading Activity, Gains and Losses, Net | 12,550 | 0 | 1,528,367 |
Unrealized Gain (Loss or Write-down) [Member] | Cost of Goods, Total [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Trading Activity, Gains and Losses, Net | -214,189 | 134,050 | -44,125 |
Not Designated as Hedging Instrument [Member] | ' | ' | ' |
Trading Activity, Gains and Losses, Net [Line Items] | ' | ' | ' |
Derivative assets - primarily corn contracts | 193,060 | 134,050 | ' |
Derivative liabilities - corn contracts | -394,699 | 0 | ' |
Payables to Broker-Dealers and Clearing Organizations | 633,115 | ' | ' |
Receivables from Clearing Organizations | ' | -62,072 | ' |
Total | $431,476 | $71,978 | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (Fair Value, Measurements, Recurring [Member], USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
Total [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Derivative assets - primarily corn contracts | $193,060 | $134,050 |
Liabilities, derivative financial instruments | 394,699 | ' |
Level 1 [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Derivative assets - primarily corn contracts | 193,060 | 134,050 |
Liabilities, derivative financial instruments | 394,699 | ' |
Level 2 [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Derivative assets - primarily corn contracts | 0 | 0 |
Level 3 [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Derivative assets - primarily corn contracts | $0 | $0 |
Employee_Benefit_Plan_Details
Employee Benefit Plan (Details) (401K [Member], USD $) | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 | |
401K [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
Defined contribution plan, employer matching contribution, percent | 50.00% | ' | ' |
Defined contribution plan, maximum annual contribution per employee, percent | 6.00% | ' | ' |
Defined benefit plan, contributions by employer and plan expenses | $58,310 | $72,360 | $65,495 |
Sale_of_Property_Details
Sale of Property (Details) (USD $) | 12 Months Ended |
Sep. 30, 2012 | |
Sale of Property [Abstract] | ' |
Land sales | $1,181,000 |
Gain on sale of property | $496,098 |