Document and Entity Information
Document and Entity Information Document - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 14, 2018 | |
Document Information [Line Items] | ||
Entity Registrant Name | HOMELAND ENERGY SOLUTIONS LLC | |
Entity Central Index Key | 1,366,744 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 64,585 |
Balance Sheets
Balance Sheets - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 28,761,352 | $ 29,568,227 |
Trading securities | 30,106,899 | 30,202,665 |
Accounts receivable | 6,155,015 | 1,260,436 |
Inventory | 14,934,686 | 15,983,934 |
Prepaid and other | 2,613,835 | 2,875,753 |
Derivative instruments | 708,551 | 755,220 |
Total current assets | 83,280,338 | 80,646,235 |
PROPERTY AND EQUIPMENT | ||
Land and improvements | 22,848,729 | 22,790,957 |
Buildings | 8,718,139 | 6,580,840 |
Equipment | 207,641,083 | 209,543,737 |
Construction in progress | 2,239,350 | 91,912 |
Gross property and equipment | 241,447,301 | 239,007,446 |
Less accumulated depreciation | 106,039,111 | 98,564,276 |
Total property and equipment | 135,408,190 | 140,443,170 |
OTHER ASSETS | ||
Utility rights, net of amortization of $1,523,799 and $1,455,605 | 784,230 | 852,424 |
Other assets | 3,929,243 | 3,356,239 |
Total other assets | 4,713,473 | 4,208,663 |
TOTAL ASSETS | 223,402,001 | 225,298,068 |
CURRENT LIABILITIES | ||
Accounts payable | 7,719,176 | 12,380,120 |
Due to former member | 30,000,000 | 30,000,000 |
Accrued Expenses | 1,053,520 | 1,380,718 |
Current portion long term debt | 6,000,000 | 6,000,000 |
Total current liabilities | 44,772,696 | 49,760,838 |
COMMITMENTS AND CONTINGENCIES | ||
LONG-TERM LIABILITIES | ||
Term note | 20,943,718 | 23,936,683 |
Total long-term liabilities | 20,943,718 | 23,936,683 |
MEMBERS' EQUITY (64,585 units issued and outstanding) | 157,685,587 | 151,600,547 |
TOTAL LIABILITIES AND MEMBERS' EQUITY | $ 223,402,001 | $ 225,298,068 |
Balance Sheets Parenthetical
Balance Sheets Parenthetical - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Other Assets: | ||
Utility rights, net of amortization | $ 1,523,799 | $ 1,455,605 |
MEMBERS’ EQUITY | ||
Members Capital units issued | 64,585 | 64,585 |
Members Capital units outstanding | 64,585 | 64,585 |
Statements of Operations
Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue | $ 84,188,461 | $ 71,505,612 | $ 160,810,908 | $ 134,662,110 |
Cost of goods sold | 72,098,034 | 64,764,136 | 142,794,154 | 122,785,589 |
Gross profit | 12,090,427 | 6,741,476 | 18,016,754 | 11,876,521 |
Selling, general and administrative expenses | 1,102,757 | 732,835 | 1,847,830 | 2,027,155 |
Operating income | 10,987,670 | 6,008,641 | 16,168,924 | 9,849,366 |
Other Income (expense) | ||||
Interest (expense) | (361,170) | 0 | (723,938) | 0 |
Interest income | 3,747 | 26,370 | 6,450 | 27,132 |
Other Income | 69,789 | 192,054 | 321,354 | 504,694 |
Total other income (expense) | (287,634) | 218,424 | (396,134) | 531,826 |
Net income | $ 10,700,036 | $ 6,227,065 | $ 15,772,790 | $ 10,381,192 |
Basic & diluted net income per capital unit | $ 165.67 | $ 96.42 | $ 244.22 | $ 160.74 |
Weighted average number of units outstanding for the calculation of basic & diluted net income per capital unit | 64,585 | 64,585 | 64,585 | 64,585 |
Distribution per Unit | $ 150 | $ 139 | $ 150 | $ 139 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 15,772,790 | $ 10,381,192 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 7,550,064 | 6,179,306 |
Unrealized loss on risk managment activities | 46,669 | 243,638 |
Unrealized (gain) loss on trading securities activities | 95,766 | (463,238) |
Change in working capital components: | ||
Accounts receivable | (4,894,579) | 3,268,119 |
Inventory | 1,049,248 | (893,199) |
Prepaid and other | 261,918 | 302,087 |
Accounts payable and other accrued expenses | (2,635,963) | (1,235,784) |
Net cash provided by operating activities | 17,245,913 | 17,782,121 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Redemptions of trading securities | 0 | 2,800,000 |
Payments for equipment and construction in progress | (4,792,034) | (13,497,375) |
(Increase) Decrease in other assets | (573,004) | 28,678 |
Net cash (used in) investing activities | (5,365,038) | (10,668,697) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Distribution to members | 9,687,750 | 0 |
Proceeds from long-term borrowings | 0 | 30,000,000 |
Payments on long-term borrowings | (3,000,000) | 0 |
Net cash (used in) provided by financing activities | (12,687,750) | 30,000,000 |
Net (decrease) in cash and cash equivalents | (806,875) | 37,113,424 |
Cash and Cash Equivalents - Beginning | 29,568,227 | 14,168,643 |
Cash and Cash Equivalents - Ending | 28,761,352 | 51,282,067 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Cash paid for interest | 840,645 | 0 |
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | ||
Distributions declared but unpaid | 0 | 8,977,315 |
Accounts payable issued for property and equipment additions | $ 196,277 | $ 10,884,048 |
Nature of Business and Signific
Nature of Business and Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Nature of Business and Significant Accounting Policies [Abstract] | |
Nature of Business and Significant Accounting Policies | Nature of Business and Significant Accounting Policies The accompanying unaudited condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted as permitted by such rules and regulations. These financial statements and related notes should be read in conjunction with the financial statements and notes thereto included in the Company's audited financial statements for the year ended December 31, 2017 , contained in the Company's annual report on Form 10-K for 2017 . In the opinion of management, the interim condensed financial statements reflect all adjustments considered necessary for fair presentation. The adjustments made to these statements consist only of normal recurring adjustments. Nature of Business Homeland Energy Solutions, LLC (an Iowa Limited Liability Company) is located near Lawler, Iowa and was organized to pool investors for a 100 million gallon ethanol plant with distribution primarily throughout the United States. The Company has capacity to produce in excess of 190 million gallons annually and sells distillers dried grains and corn oil as byproducts of ethanol production. Organization Homeland Energy Solutions, LLC is organized as an Iowa limited liability company. The members' liability is limited as specified in Homeland Energy Solutions' operating agreement and pursuant to the Iowa Revised Uniform Limited Liability Company Act. Significant Accounting Policies : Accounting Estimates Management uses estimates and assumptions in preparing these financial statements in accordance with United States Generally Accepted Accounting Principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates. Cash & Cash Equivalents The Company maintains its accounts primarily at one financial institution. At various times, the Company's cash balances may exceed amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced losses in such accounts. Trading Securities Investments bought and held principally for the purpose of selling them in the near term are classified as trading securities. Trading securities are measured at fair value using prices obtained from pricing services. Any interest, dividends, and unrealized or realized gains and losses on the trading securities are recorded as part of other income. At June 30, 2018 , trading securities consisted of short term bond mutual funds with an approximate cost of $30,905,000 and fair value of $30,107,000 . At December 31, 2017 , trading securities consisted of corporate bonds and short term bond mutual funds with an approximate cost of $30,569,000 and fair value of $30,203,000 . For the three and six months ended June 30, 2018 , the Company recorded interest, dividend and net realized and unrealized gains and (losses) from these investments of approximately $59,000 and ($96,000) , respectively. During the same time periods of 2017 , the Company recorded interest, dividends and net unrealized gains and losses from these investments of approximately $226,000 and $463,000 , respectively. The Board of Directors voted to set aside up to $30 million in trading securities that will be used by the Company for the repurchase of 25,860 membership units per the terms of an agreement with Mr. Retterath entered into on June 13, 2013 with the Company. Receivables Credit sales are made primarily to two customers and no collateral is required. The Company carries these accounts receivable at original invoice amount with no allowance for doubtful accounts due to the historical collection rates on these accounts. Investments The Company has a less than 20% investment interest in Renewable Products Marketing Group, LLC ("RPMG"). This investment is being accounted for under the equity method of accounting, as the company has significant influence, under which the Company's share of net income is recognized as income in the Company's statement of operations and added to the investment account. The investment balance is included in other assets and the income recognized as other income. The investment is evaluated for indications of impairment on a regular basis. A loss would be recognized when the fair value is determined to be less than the carrying value. Revenue and Cost Recognition In the first quarter of 2018, the Company adopted Accounting Standards Update (ASU) 2014-9, Revenue from Contracts with Customers (Topic 606). Under the ASU, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company applied the five-step method outlined in the ASU to all contracts with customers and elected the modified retrospective implementation method. The Company generally has a single performance obligation in its arrangements with customers. The Company believes for its contracts with customers, control is transferred at a point in time, typically upon delivery to the customers. When the Company performs shipping and handling activities after the transfer of control to the customers (e.g., when control transfers prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued for when the related revenue is recognized. The Company generally expenses sales commissions when incurred because the amortization period would have been less than one year. The implementation of the new standard does not have any material impact on the measurement or recognition of revenue of prior periods, however additional disclosures have been added in accordance with the ASU. The following is a description of principal activities from which we generate revenue. Revenues from contracts with customers are recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. • sales of ethanol; • sales of distiller grains; and • sales of corn oil; All revenue recognized in the income statement is considered to be revenue from contracts with customers. The disaggregation of revenue according to product line, along with accounts receivable from contracts with customers, is as disclosed in Note 5. Shipping costs incurred by the Company in the sale of ethanol and distiller grains are not specifically identifiable and as a result, revenue from the sale of ethanol and distiller grains is recorded based on the net selling price reported to the Company from the marketer. Rail car lease costs incurred by the Company in the sale and shipment of distiller grain products are included in the cost of goods sold. Inventories Inventories are generally valued at the lower of cost (first-in, first-out) or net realizable value. In the valuation of inventories and purchase commitments, net realizable value is defined as estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation. Property & Equipment The Company reviews its property and equipment for impairment whenever events indicate that the carrying amount of the asset group may not be recoverable. If circumstances require an asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by the asset group to the carrying value of the asset group. If the carrying value of the asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Derivative Instruments The Company evaluates its contracts to determine whether the contracts are derivative instruments. Certain contracts that literally meet the definition of a derivative may be exempted from derivative accounting as normal purchases or normal sales. Normal purchases and normal sales are contracts that provide for the purchase or sale of something other than a financial instrument or derivative instrument that will be delivered in quantities expected to be used or sold over a reasonable period in the normal course of business. Contracts that meet the requirements of normal purchases or sales are documented as normal and exempted from the accounting and reporting requirements of derivative accounting. The Company enters into short-term cash, option and futures contracts as a means of securing purchases of corn, natural gas and sales of ethanol for the plant and managing exposure to changes in commodity and energy prices. All of the Company's derivatives are designated as non-hedge derivatives for accounting purposes, with changes in fair value recognized in net income. Although the contracts are economic hedges of specified risks, they are not designated as and accounted for as hedging instruments. As part of its trading activity, the Company uses futures and option contracts through regulated commodity exchanges to manage its risk related to pricing of inventories. To reduce that risk, the Company generally takes positions using cash and futures contracts and options. Realized and unrealized gains and losses related to derivative contracts related to corn and natural gas are included as a component of cost of goods sold and derivative contracts related to ethanol are included as a component of revenue in the accompanying financial statements. The fair values of contracts entered through commodity exchanges are presented on the accompanying balance sheet as derivative instruments. All contracts with the same counter party are reported on a net basis. Committed Shares to be Redeemed On June 13, 2013, the Company entered into an agreement with Steve Retterath, the Company's largest member, to repurchase and retire all of the membership units owned by Mr. Retterath. The Company agreed to close on this repurchase on or before August 1, 2013. The Company agreed to repurchase and retire 25,860 membership units owned by Mr. Retterath in exchange for $30 million , to be paid in two equal installments payable at closing and on July 1, 2014. The transaction failed to close by the scheduled date due to objections by Mr. Retterath. Due to all conditions of the agreement being met prior to, or on, August 1, 2013, and a court ruling which found the agreement to be binding and enforceable, the Company believes that it has a binding agreement with Mr. Retterath; as such the commitment to repurchase and retire the membership units is reflected in the financial statements as a current liability, due to former member, as if the transaction had closed on August 1, 2013. See Note 9 for additional information. Net Income per Unit Basic and diluted net income per unit is computed by dividing net income by the weighted average number of members' units and members' unit equivalents outstanding during the period. There were no member unit equivalents outstanding during the periods presented; accordingly, the Company's basic and diluted net income per unit are the same. Prior to, or on, August 1, 2013, the Company believes it has a binding agreement with Steve Retterath to repurchase and retire all 25,860 membership units owned by Mr. Retterath. These membership units have thus been excluded in the determination of net income per capital unit as presented in the Statement of Operations. The Company is currently involved in litigation with Mr. Retterath. There is potential that Mr. Retterath will continue as a unit holder upon conclusion of the litigation and said membership units would not be redeemed under the repurchase agreement. If the units are not redeemed, basic and diluted net income per unit, including the 25,860 units, for the three and six months ended June 30, 2018 would be $118.30 and $174.39 , respectively. Net income per unit for the three and six months ended June 30, 2017 would have been $68.85 and $114.78 respectively. Risks and Uncertainties The Company has certain risks and uncertainties that it will experience during volatile market conditions, which can have a severe impact on operations. The Company's revenues are derived from the sale and distribution of ethanol, distiller grains and corn oil to customers primarily located in the United States. Corn for the production process is supplied to the plant primarily from local agricultural producers and from purchases on the open market. For the six months ended June 30, 2018 , ethanol sales averaged approximately 77% of total revenues, while approximately 20% of revenues were generated from the sale of distiller grains. Corn oil sales attributed approximately 3% of revenues during this time period. For the six months ended June 30, 2018 , corn costs averaged approximately 76% of cost of goods sold. The Company's operating and financial performance is largely driven by the prices at which ethanol is sold and the net expense of corn. The price of ethanol is influenced by factors such as supply and demand, weather, government policies and programs, and unleaded gasoline and the petroleum markets. Excess ethanol supply in the market, in particular, puts downward pressure on the price of ethanol. The Company's largest cost of production is corn. The cost of corn is generally impacted by factors such as supply and demand, weather, and government policies and programs. The Company's risk management program is used to protect against the price volatility of these commodities. Recent & Pending Accounting Pronouncements In February 2016, FASB issued ASU No. 2016-02 "Leases" ("ASU 2016-02"). ASU 2016-02 requires the recognition of lease assets and lease liabilities by lessees for all leases greater than one year in duration and classified as operating leases under previous GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and for interim periods within that fiscal year. The Company is currently evaluating the impact of its pending adoption of the new standard on the financial statements. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2018 | |
Inventory [Abstract] | |
Inventory | INVENTORY Inventory consisted of the following as of June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Raw Materials $ 9,426,630 $ 10,692,802 Work in Process 2,586,625 1,827,414 Finished Goods 2,921,431 3,463,718 Totals $ 14,934,686 $ 15,983,934 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt [Abstract] | |
Debt | DEBT Master Loan Agreement with Home Federal Savings Bank On June 29, 2017, the Company amended and restated the Master Loan Agreement with Home Federal Savings Bank ("Home Federal"), amending the term revolving loan to provide funding to operate the plant and establishing a term loan to help fund the Company's $42 million expansion project. In return, the Company entered into agreements providing Home Federal a security interest in substantially all personal property located on Company property. The Company currently has two loans with Home Federal, a term revolving loan and a term loan. Term Revolving Loan Under the terms of the Second Supplement to the Master Loan Agreement, dated June 29, 2017, the Company has a $30 million term revolving loan which has a maturity date of December 31, 2022. Interest on the term revolving loan is due monthly and accrues at a rate equal to the one month LIBOR plus 310 basis points, 5.10% on June 30, 2018 . There was no balance outstanding on the term revolving loan and $30 million available to be drawn as of June 30, 2018 and December 31, 2017 , respectively. Term Debt Under the terms of the Fourth Supplement to the Master Loan Agreement, dated June 29, 2017, the Company has a $30 million term loan which has a maturity date of December 31, 2022. Interest on the term loan is at a fixed rate of 4.79% . The Company is required to make monthly interest payments beginning July 1, 2017 and bi-annual principal payments of $3 million beginning on June 30, 2018. The long-term portion of the outstanding debt is presented net of unamortized debt issuance costs of $56,282 and $63,317 as of June 30, 2018 and December 31, 2017 , respectively. At June 30, 2018 , the Company had the following debt maturities on the term loan for the twelve month periods ended June 30: 2019 $ 6,000,000 2020 6,000,000 2021 6,000,000 2022 6,000,000 2023 3,000,000 Total principal payments $ 27,000,000 Covenants During the term of the loans, the Company is subject to certain financial covenants at various times calculated monthly, quarterly or annually, including restriction of the payment of dividends and capital expenditures and maintenance of certain financial ratios including the minimum working capital and a fixed charge ratio as defined by the Master Loan Agreement. Failure to comply with the protective loan covenants or maintain the required financial ratios may cause acceleration of the outstanding principal balances on the loans and/or the imposition of fees, charges or penalties. The Company is in compliance with all debt covenants as of June 30, 2018 . |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS Due to former member On June 13, 2013, we entered into an agreement with Steve Retterath, the Company's largest member, to repurchase and retire all of the units owned by Mr. Retterath. The Company agreed to close on this repurchase on or before August 1, 2013. The Company agreed to repurchase and retire 25,860 membership units owned by Mr. Retterath in exchange for $30 million , to be paid in two equal installments payable at closing and on July 1, 2014. The transaction failed to close by the scheduled date due to objections by Mr. Retterath. The Company believes that it has a binding agreement with Mr. Retterath. On August 14, 2013, the Company filed a lawsuit against Mr. Retterath in Iowa state court to enforce the terms of the repurchase agreement. The Company is asking the Iowa state court to require Mr. Retterath to complete the repurchase agreement pursuant to its terms. Mr. Retterath contends he is not bound by the agreement. The Company's position is as of the closing date, Mr. Retterath is no longer the equitable owner of any membership units in the Company. As a result, in 2013 the Company recorded a $30 million short-term liability related to the amount the Company agreed to pay Mr. Retterath to repurchase his membership units and correspondingly reduced members' equity on the balance sheet. If the Company is ultimately unsuccessful in its lawsuit against Mr. Retterath, the Company will reevaluate the accounting considerations made during the period of time that the lawsuit is pending. Other matters The Company has purchased corn and materials from members of its Board of Directors who own or manage elevators or are local producers of corn. Purchases during the three and six months ended June 30, 2018 totaled approximately $354,000 and $1,542,000 , respectively, and during the three and six months ended June 30, 2017 totaled approximately $4,737,000 and $9,159,000 , respectively. There were no amounts due to these members as of June 30, 2018 and $3,000 due to these members at December 31, 2017 . |
Commitments, Contingencies, Agr
Commitments, Contingencies, Agreements and Subsequent Events | 6 Months Ended |
Jun. 30, 2018 | |
Commitments, Contingencies and Agreements [Abstract] | |
Commitments, Contingencies, Agreements and Subsequent Events | COMMITMENTS, CONTINGENCIES, AGREEMENTS AND SUBSEQUENT EVENTS Ethanol, corn oil, and distiller grains marketing agreements and major customers The Company has entered into a marketing agreement with RPMG to sell all ethanol produced at the plant at a mutually agreed on price, less commission and transportation charges. As of June 30, 2018 , the Company had commitments to sell approximately 2,765,000 produced gallons of ethanol at various fixed prices and 43 million of its produced gallons of ethanol at basis price levels indexed against exchanges for delivery through September 30, 2018. The Company has entered into a marketing agreement with RPMG to sell all corn oil produced at the plant at a mutually agreed on price, less marketing fees and transportation charges. As of June 30, 2018 , the Company had commitments to sell approximately 11.3 million pounds of corn oil at various fixed and basis price levels indexed against exchanges for delivery through December 31, 2018. The Company also has an investment in RPMG, included in other assets, totaling approximately $2,417,000 and $2,330,000 as of June 30, 2018 and December 31, 2017, respectively. The Company has entered into a marketing agreement to sell all distiller grains produced at the plant to CHS, an unrelated party, at a mutually agreed on price, less commission and transportation charges. The agreement was renewed for another one year term on April 1, 2018. The agreement calls for automatic renewal for successive one -year terms unless 90 -day prior written notice is given before the current term expires. As of June 30, 2018 , the Company had approximately 41,000 tons of distiller grains sales commitments for delivery through November 2018 at various fixed prices. Sales and marketing fees related to the agreements in place for the three and six months ended June 30, 2018 and 2017 were approximately as follows: Three Months Ended Six Months Ended Three Months Ended Six Months Ended June 30, 2018 June 30, 2018 June 30, 2017 June 30, 2017 Sales ethanol $ 63,999,000 $ 123,172,000 $ 58,806,000 $ 109,528,000 Sales distiller grains 16,855,000 31,650,000 9,075,000 18,383,000 Sales corn oil 3,335,000 5,989,000 3,624,000 6,750,000 Marketing fees ethanol $ 66,000 $ 132,000 $ 61,000 $ 123,000 Marketing fees distiller grains 216,000 422,000 171,000 366,000 Marketing fees corn oil 28,000 50,000 27,000 52,000 As of June 31, 2018 As of December 31, 2017 Amount due from RPMG $ 3,861,000 $ 236,000 Amount due from CHS 1,797,000 900,000 At June 30, 2018 , the Company had approximately $23,856,000 in outstanding priced corn purchase commitments for bushels at various prices and approximately 4,333,000 bushels of basis contracts through September 2019 accounted for under the normal purchase exclusion. The Company has commitments for minimum purchases of various utilities such as natural gas and electricity over the next 12 months totaling approximately $10,606,000 accounted for under the normal purchase exclusion. As of June 30, 2018 , the Company had locked in place approximately 5,362,000 decatherms of natural gas at fixed prices through December 31, 2019 accounted for under the normal purchase exclusion. No fixed price natural gas was committed as of June 30, 2017 . Through the date of this filing, the Company has entered into construction agreements totaling approximately $8.6 million related to several improvement projects. The Company has incurred costs of approximately $1.2 million related to these projects through June 30, 2018. Total outstanding commitments under these agreements as of the filing date are $7.4 million . All of the projects are anticipated to be complete by December 31, 2018. |
Lease Obligations
Lease Obligations | 6 Months Ended |
Jun. 30, 2018 | |
Lease Obligations [Abstract] | |
Lease Obligations | LEASE OBLIGATIONS The Company leases rail cars and rail moving equipment with original terms up to 5 years . The Company is obligated to pay costs of insurance, taxes, repairs and maintenance pursuant to the terms of the leases. Rent expense incurred for the operating leases during the three and six months ended June 30, 2018 was approximately $379,000 and $753,000 , respectively, and for the same periods in 2017 was approximately $371,000 and $781,000 , respectively. At June 30, 2018 , the Company had the following approximate minimum rental commitments under non-cancelable operating leases for the twelve month periods ended June 30: 2019 $ 1,515,000 2020 1,515,000 2021 1,515,000 2022 1,515,000 2023 323,000 Total lease commitments $ 6,383,000 |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments [Abstract] | |
Derivative Instruments | DERIVATIVE INSTRUMENTS 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 financial and commodities markets and seeks to reduce the potentially adverse effects that the volatility of these markets may have on its operating results. To reduce price risk caused by market fluctuations, the Company generally follows a policy of using exchange traded futures and options contracts to reduce its net position of merchandisable agricultural commodity inventories and forward cash purchase and sales contracts and uses exchange traded futures and options contracts to reduce price risk. Exchange-traded futures contracts are valued at market price. Changes in market price of exchange traded futures and options contracts related to corn and natural gas are recorded in costs of goods sold and changes in market prices of contracts related to the sale of ethanol, if applicable, are recorded in revenues. The Company uses futures or options contracts to fix the purchase price of anticipated volumes of corn to be purchased and processed in a future month. The Company's plant will grind approximately 63 million bushels of corn per year. Over the next 12 months, the Company has hedged and anticipates hedging between 10% and 25% of its anticipated annual grind. At June 30, 2018 , the Company has hedged portions of its anticipated monthly purchases for corn averaging approximately 13% of its anticipated monthly grind over the next twelve months. The following table represents the approximate amount of realized/unrealized gains (losses) and changes in fair value recognized in earnings on commodity contracts for the three and six months ending June 30, 2018 and 2017 and the fair value of derivatives as of June 30, 2018 and December 31, 2017 : Income Statement Classification Realized Gain (Loss) Change In Unrealized Gain (Loss) Total Gain (Loss) Derivatives not designated as hedging instruments: Commodity contracts for the three months ended June 30, 2018 Cost of Goods Sold $ 737,000 $ 2,509,000 $ 3,246,000 Commodity contracts for the three months ended June 30, 2017 Cost of Goods Sold $ 221,000 $ 49,000 $ 270,000 Commodity contracts for the six months ended June 30, 2018 Cost of Goods Sold $ (405,000 ) $ 1,743,000 $ 1,338,000 Commodity contracts for the six months ended July 30, 2017 Cost of Goods Sold $ 255,000 $ (43,000 ) $ 212,000 Balance Sheet Classification June 30, 2018 December 31, 2017 Futures contracts In gain position $ 2,096,000 $ 305,000 In loss position (53,000 ) (7,000 ) Cash (due to) held by broker (1,334,000 ) 457,000 Current Asset $ 709,000 $ 755,000 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Measurements [Abstract] | |
Fair Value Disclosures [Text Block] | 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 2: Valuations 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 3: Valuations 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: Trading securities: Trading securities consisting of corporate bonds and short term bond mutual funds are reported at fair value utilizing Level 1 inputs. Trading securities are measured at fair value using prices obtained from pricing services. 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 CBOT and NYMEX markets. The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 , segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: Total Level 1 Level 2 Level 3 As of June 30, 2018 Trading securities, assets $ 30,107,000 $ 30,107,000 $ — $ — Derivative financial instruments Assets $ 2,096,000 $ 2,096,000 $ — $ — Liabilities (53,000 ) (53,000 ) — — As of December 31, 2017 Trading securities, assets $ 30,203,000 $ 30,203,000 $ — $ — Derivative financial instruments Assets $ 305,000 $ 305,000 — — Liabilities (7,000 ) (7,000 ) — — The Company's financial assets and liabilities not recorded at fair value, for which carrying value approximates fair value, consists of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses. Additionally, fixed rate term debt, carried at book value of $27,000,000 at June 30, 2018 , had an estimated fair value of approximately $26,652,000 , determined based on a discounted cash flows model. As of December 31, 2017 , carrying value of long term debt approximated its fair value. |
Litigation Matters
Litigation Matters | 6 Months Ended |
Jun. 30, 2018 | |
Litigations Matters [Abstract] | |
Litigation Matters | LITIGATION MATTERS Retterath In relation to the repurchase agreement discussed in Note 4, on August 1, 2013 Mr. Retterath filed a lawsuit against the Company along with several directors, the Company's former CEO, CFO, COO, a former director and the Company's outside legal counsel in Florida state court. In August 2016, this lawsuit was voluntarily dismissed without prejudice by the Retteraths. On August 14, 2013, the Company filed a lawsuit in Iowa state court to enforce the repurchase agreement the Company entered into with Mr. Retterath. No distributions have been paid to Mr. Retterath since the time of the original expected closing date of August 1, 2013. On June 15, 2017, the Iowa Court ruled in favor of Homeland that the repurchase agreement was valid and directed Mr. Retterath to perform his obligations under the repurchase agreement by August 1, 2017. Mr. Retterath subsequently filed various motions with the Iowa Court and was granted a stay regarding his obligation to perform the repurchase agreement while the court considered his post trial motions. On May 7, 2018, the Iowa Court denied Mr. Retterath's motions for a new trial and to reconsider the Iowa Court's prior ruling. Mr. Retterath is appealing the Iowa Court's decisions. GS Cleantech Corporation On August 9, 2013, GS Cleantech Corporation (GS Cleantech), a subsidiary of Greenshift Corporation, filed a complaint against the Company alleging that the Company's operation of a corn oil extraction process licensed by the Company infringes patent rights claimed by GS Cleantech. GS Cleantech seeks royalties, damages and potentially triple damages associated with the alleged infringement, as well as attorney's fees from the Company. The Company filed a motion for summary judgment which was granted by the Court. The Company expects GS Cleantech will appeal this decision. |
Accounting Policies
Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Nature of Business and Significant Accounting Policies [Abstract] | |
Accounting Estimates | Accounting Estimates Management uses estimates and assumptions in preparing these financial statements in accordance with United States Generally Accepted Accounting Principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash & Cash Equivalents The Company maintains its accounts primarily at one financial institution. At various times, the Company's cash balances may exceed amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced losses in such accounts. |
Trading Securities | Trading Securities Investments bought and held principally for the purpose of selling them in the near term are classified as trading securities. Trading securities are measured at fair value using prices obtained from pricing services. Any interest, dividends, and unrealized or realized gains and losses on the trading securities are recorded as part of other income. At June 30, 2018 , trading securities consisted of short term bond mutual funds with an approximate cost of $30,905,000 and fair value of $30,107,000 . At December 31, 2017 , trading securities consisted of corporate bonds and short term bond mutual funds with an approximate cost of $30,569,000 and fair value of $30,203,000 . For the three and six months ended June 30, 2018 , the Company recorded interest, dividend and net realized and unrealized gains and (losses) from these investments of approximately $59,000 and ($96,000) , respectively. During the same time periods of 2017 , the Company recorded interest, dividends and net unrealized gains and losses from these investments of approximately $226,000 and $463,000 , respectively. The Board of Directors voted to set aside up to $30 million in trading securities that will be used by the Company for the repurchase of 25,860 membership units per the terms of an agreement with Mr. Retterath entered into on June 13, 2013 with the Company. |
Receivables | Receivables Credit sales are made primarily to two customers and no collateral is required. The Company carries these accounts receivable at original invoice amount with no allowance for doubtful accounts due to the historical collection rates on these accounts. |
Investments | Investments The Company has a less than 20% investment interest in Renewable Products Marketing Group, LLC ("RPMG"). This investment is being accounted for under the equity method of accounting, as the company has significant influence, under which the Company's share of net income is recognized as income in the Company's statement of operations and added to the investment account. The investment balance is included in other assets and the income recognized as other income. The investment is evaluated for indications of impairment on a regular basis. A loss would be recognized when the fair value is determined to be less than the carrying value. |
Revenue and Cost Recognition | Revenue and Cost Recognition In the first quarter of 2018, the Company adopted Accounting Standards Update (ASU) 2014-9, Revenue from Contracts with Customers (Topic 606). Under the ASU, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company applied the five-step method outlined in the ASU to all contracts with customers and elected the modified retrospective implementation method. The Company generally has a single performance obligation in its arrangements with customers. The Company believes for its contracts with customers, control is transferred at a point in time, typically upon delivery to the customers. When the Company performs shipping and handling activities after the transfer of control to the customers (e.g., when control transfers prior to delivery), they are considered as fulfillment activities, and accordingly, the costs are accrued for when the related revenue is recognized. The Company generally expenses sales commissions when incurred because the amortization period would have been less than one year. The implementation of the new standard does not have any material impact on the measurement or recognition of revenue of prior periods, however additional disclosures have been added in accordance with the ASU. The following is a description of principal activities from which we generate revenue. Revenues from contracts with customers are recognized when control of the promised goods or services are transferred to our customers, in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. • sales of ethanol; • sales of distiller grains; and • sales of corn oil; All revenue recognized in the income statement is considered to be revenue from contracts with customers. The disaggregation of revenue according to product line, along with accounts receivable from contracts with customers, is as disclosed in Note 5. Shipping costs incurred by the Company in the sale of ethanol and distiller grains are not specifically identifiable and as a result, revenue from the sale of ethanol and distiller grains is recorded based on the net selling price reported to the Company from the marketer. Rail car lease costs incurred by the Company in the sale and shipment of distiller grain products are included in the cost of goods sold. |
Inventories | Inventories Inventories are generally valued at the lower of cost (first-in, first-out) or net realizable value. In the valuation of inventories and purchase commitments, net realizable value is defined as estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal, and transportation. |
Property & Equipment | Property & Equipment The Company reviews its property and equipment for impairment whenever events indicate that the carrying amount of the asset group may not be recoverable. If circumstances require an asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by the asset group to the carrying value of the asset group. If the carrying value of the asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. |
Derivative Instruments | Derivative Instruments The Company evaluates its contracts to determine whether the contracts are derivative instruments. Certain contracts that literally meet the definition of a derivative may be exempted from derivative accounting as normal purchases or normal sales. Normal purchases and normal sales are contracts that provide for the purchase or sale of something other than a financial instrument or derivative instrument that will be delivered in quantities expected to be used or sold over a reasonable period in the normal course of business. Contracts that meet the requirements of normal purchases or sales are documented as normal and exempted from the accounting and reporting requirements of derivative accounting. The Company enters into short-term cash, option and futures contracts as a means of securing purchases of corn, natural gas and sales of ethanol for the plant and managing exposure to changes in commodity and energy prices. All of the Company's derivatives are designated as non-hedge derivatives for accounting purposes, with changes in fair value recognized in net income. Although the contracts are economic hedges of specified risks, they are not designated as and accounted for as hedging instruments. As part of its trading activity, the Company uses futures and option contracts through regulated commodity exchanges to manage its risk related to pricing of inventories. To reduce that risk, the Company generally takes positions using cash and futures contracts and options. Realized and unrealized gains and losses related to derivative contracts related to corn and natural gas are included as a component of cost of goods sold and derivative contracts related to ethanol are included as a component of revenue in the accompanying financial statements. The fair values of contracts entered through commodity exchanges are presented on the accompanying balance sheet as derivative instruments. All contracts with the same counter party are reported on a net basis. |
Committed Shares to be Redeemed | Committed Shares to be Redeemed On June 13, 2013, the Company entered into an agreement with Steve Retterath, the Company's largest member, to repurchase and retire all of the membership units owned by Mr. Retterath. The Company agreed to close on this repurchase on or before August 1, 2013. The Company agreed to repurchase and retire 25,860 membership units owned by Mr. Retterath in exchange for $30 million , to be paid in two equal installments payable at closing and on July 1, 2014. The transaction failed to close by the scheduled date due to objections by Mr. Retterath. Due to all conditions of the agreement being met prior to, or on, August 1, 2013, and a court ruling which found the agreement to be binding and enforceable, the Company believes that it has a binding agreement with Mr. Retterath; as such the commitment to repurchase and retire the membership units is reflected in the financial statements as a current liability, due to former member, as if the transaction had closed on August 1, 2013. See Note 9 for additional information. |
Net Income per Unit | Net Income per Unit Basic and diluted net income per unit is computed by dividing net income by the weighted average number of members' units and members' unit equivalents outstanding during the period. There were no member unit equivalents outstanding during the periods presented; accordingly, the Company's basic and diluted net income per unit are the same. Prior to, or on, August 1, 2013, the Company believes it has a binding agreement with Steve Retterath to repurchase and retire all 25,860 membership units owned by Mr. Retterath. These membership units have thus been excluded in the determination of net income per capital unit as presented in the Statement of Operations. The Company is currently involved in litigation with Mr. Retterath. There is potential that Mr. Retterath will continue as a unit holder upon conclusion of the litigation and said membership units would not be redeemed under the repurchase agreement. If the units are not redeemed, basic and diluted net income per unit, including the 25,860 units, for the three and six months ended June 30, 2018 would be $118.30 and $174.39 , respectively. Net income per unit for the three and six months ended June 30, 2017 would have been $68.85 and $114.78 respectively. |
Risks and Uncertainties | Risks and Uncertainties The Company has certain risks and uncertainties that it will experience during volatile market conditions, which can have a severe impact on operations. The Company's revenues are derived from the sale and distribution of ethanol, distiller grains and corn oil to customers primarily located in the United States. Corn for the production process is supplied to the plant primarily from local agricultural producers and from purchases on the open market. For the six months ended June 30, 2018 , ethanol sales averaged approximately 77% of total revenues, while approximately 20% of revenues were generated from the sale of distiller grains. Corn oil sales attributed approximately 3% of revenues during this time period. For the six months ended June 30, 2018 , corn costs averaged approximately 76% of cost of goods sold. The Company's operating and financial performance is largely driven by the prices at which ethanol is sold and the net expense of corn. The price of ethanol is influenced by factors such as supply and demand, weather, government policies and programs, and unleaded gasoline and the petroleum markets. Excess ethanol supply in the market, in particular, puts downward pressure on the price of ethanol. The Company's largest cost of production is corn. The cost of corn is generally impacted by factors such as supply and demand, weather, and government policies and programs. The Company's risk management program is used to protect against the price volatility of these commodities. |
Recent & Pending Accounting Pronouncements | Recent & Pending Accounting Pronouncements In February 2016, FASB issued ASU No. 2016-02 "Leases" ("ASU 2016-02"). ASU 2016-02 requires the recognition of lease assets and lease liabilities by lessees for all leases greater than one year in duration and classified as operating leases under previous GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and for interim periods within that fiscal year. The Company is currently evaluating the impact of its pending adoption of the new standard on the financial statements. |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Inventory [Abstract] | |
Schedule of Inventory | Inventory consisted of the following as of June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 Raw Materials $ 9,426,630 $ 10,692,802 Work in Process 2,586,625 1,827,414 Finished Goods 2,921,431 3,463,718 Totals $ 14,934,686 $ 15,983,934 |
Debt Term Debt (Tables)
Debt Term Debt (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt [Table Text Block] | At June 30, 2018 , the Company had the following debt maturities on the term loan for the twelve month periods ended June 30: 2019 $ 6,000,000 2020 6,000,000 2021 6,000,000 2022 6,000,000 2023 3,000,000 Total principal payments $ 27,000,000 |
Commitments, Contingencies, A18
Commitments, Contingencies, Agreements and Subsequent Events (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Commitments, Contingencies and Agreements [Abstract] | |
Schedule of Related Party Transactions | Three Months Ended Six Months Ended Three Months Ended Six Months Ended June 30, 2018 June 30, 2018 June 30, 2017 June 30, 2017 Sales ethanol $ 63,999,000 $ 123,172,000 $ 58,806,000 $ 109,528,000 Sales distiller grains 16,855,000 31,650,000 9,075,000 18,383,000 Sales corn oil 3,335,000 5,989,000 3,624,000 6,750,000 Marketing fees ethanol $ 66,000 $ 132,000 $ 61,000 $ 123,000 Marketing fees distiller grains 216,000 422,000 171,000 366,000 Marketing fees corn oil 28,000 50,000 27,000 52,000 As of June 31, 2018 As of December 31, 2017 Amount due from RPMG $ 3,861,000 $ 236,000 Amount due from CHS 1,797,000 900,000 |
Lease Obligations (Tables)
Lease Obligations (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Lease Obligations [Abstract] | |
Operating Leases Minimum Rental Commitments | 2019 $ 1,515,000 2020 1,515,000 2021 1,515,000 2022 1,515,000 2023 323,000 Total lease commitments $ 6,383,000 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments [Abstract] | |
Derivatives Not Designated as Hedging Instruments [Table Text Block] | Income Statement Classification Realized Gain (Loss) Change In Unrealized Gain (Loss) Total Gain (Loss) Derivatives not designated as hedging instruments: Commodity contracts for the three months ended June 30, 2018 Cost of Goods Sold $ 737,000 $ 2,509,000 $ 3,246,000 Commodity contracts for the three months ended June 30, 2017 Cost of Goods Sold $ 221,000 $ 49,000 $ 270,000 Commodity contracts for the six months ended June 30, 2018 Cost of Goods Sold $ (405,000 ) $ 1,743,000 $ 1,338,000 Commodity contracts for the six months ended July 30, 2017 Cost of Goods Sold $ 255,000 $ (43,000 ) $ 212,000 |
Schedule of Derivatives Instruments Statements of Financial Performance and Financial Position, Location [Table Text Block] | Balance Sheet Classification June 30, 2018 December 31, 2017 Futures contracts In gain position $ 2,096,000 $ 305,000 In loss position (53,000 ) (7,000 ) Cash (due to) held by broker (1,334,000 ) 457,000 Current Asset $ 709,000 $ 755,000 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Measurements [Abstract] | |
Fair Value, Measurement Inputs, Disclosure [Text Block] | Total Level 1 Level 2 Level 3 As of June 30, 2018 Trading securities, assets $ 30,107,000 $ 30,107,000 $ — $ — Derivative financial instruments Assets $ 2,096,000 $ 2,096,000 $ — $ — Liabilities (53,000 ) (53,000 ) — — As of December 31, 2017 Trading securities, assets $ 30,203,000 $ 30,203,000 $ — $ — Derivative financial instruments Assets $ 305,000 $ 305,000 — — Liabilities (7,000 ) (7,000 ) — — |
Product (Details)
Product (Details) - Ethanol [Member] gal in Millions | 6 Months Ended |
Jun. 30, 2018gal | |
Product Information [Line Items] | |
Annual Production Capacity, Minimum | 100 |
Annual Production Capacity, Current | 190 |
Nature of Business and Signif23
Nature of Business and Significant Accounting Policies Trading Securities (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Debt and Equity Securities, FV-NI [Line Items] | |||||
Trading Securities, Cost | $ 30,905,000 | $ 30,905,000 | $ 30,569,000 | ||
Due to former member | 30,000,000 | $ 30,000,000 | 30,000,000 | ||
Partners' Capital Account, Units, Redeemed | 25,860 | ||||
Director [Member] | |||||
Debt and Equity Securities, FV-NI [Line Items] | |||||
Due to former member | 30,000,000 | $ 30,000,000 | |||
Partners' Capital Account, Units, Redeemed | 25,860 | ||||
Other Nonoperating Income (Expense) [Member] | |||||
Debt and Equity Securities, FV-NI [Line Items] | |||||
Net Realized and Unrealized Gain (Loss) on Trading Securities | 59,000 | $ 226,000 | $ (96,000) | $ 463,000 | |
Fair Value, Measurements, Recurring [Member] | |||||
Debt and Equity Securities, FV-NI [Line Items] | |||||
Debt Securities, Trading, and Equity Securities, FV-NI | $ 30,107,000 | $ 30,107,000 | $ 30,203,000 |
Net Income per Unit (Details)
Net Income per Unit (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018USD ($)$ / shares | Jun. 30, 2017$ / shares | Jun. 30, 2018USD ($)installment$ / sharesshares | Jun. 30, 2017$ / shares | Dec. 31, 2017USD ($) | |
Related Party Transaction [Line Items] | |||||
Number of units redeemed | shares | 25,860 | ||||
Payments for Repurchase of Common Stock | $ | $ 30,000,000 | $ 30,000,000 | $ 30,000,000 | ||
Basic and diluted earning per share, including redeemed shares (in dollars per share) | $ / shares | $ 118.30 | $ 68.85 | $ 174.39 | $ 114.78 | |
Director [Member] | |||||
Related Party Transaction [Line Items] | |||||
Number of units redeemed | shares | 25,860 | ||||
Payments for Repurchase of Common Stock | $ | $ 30,000,000 | $ 30,000,000 | |||
Number of payment installments | installment | 2 |
Risks and Uncertainties (Detail
Risks and Uncertainties (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Sales Revenue, Segment [Member] | Ethanol [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 77.00% |
Sales Revenue, Segment [Member] | Distillers Grains [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 20.00% |
Sales Revenue, Segment [Member] | Corn Oil [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 3.00% |
Cost of Goods, Segment [Member] | Corn [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 76.00% |
Inventory (Details)
Inventory (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Inventory [Abstract] | ||
Raw Materials | $ 9,426,630 | $ 10,692,802 |
Work in Process | 2,586,625 | 1,827,414 |
Finished Goods | 2,921,431 | 3,463,718 |
Inventory | $ 14,934,686 | $ 15,983,934 |
Debt (Details)
Debt (Details) - USD ($) | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Jun. 29, 2017 | |
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 4.79% | |||
Debt Instrument, Periodic Payment, Principal | $ 3,000,000 | |||
Unamortized Debt Issuance Expense | $ 56,282 | $ 63,317 | ||
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months | 6,000,000 | |||
Long-term Debt, Maturities, Repayments of Principal in Rolling Year Two | 6,000,000 | |||
Long-term Debt, Maturities, Repayments of Principal in Rolling Year Three | 6,000,000 | |||
Long-term Debt, Maturities, Repayments of Principal in Year Four | 6,000,000 | |||
Long-term Debt, Maturities, Repayments of Principal in Year Five | 3,000,000 | |||
Long-term Debt | $ 20,943,718 | 23,936,683 | ||
Line of Credit [Member] | Home Federal Savings Bank [Member] | Term Revolving Loan [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Basis Spread on Variable Rate | 3.10% | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 30,000,000 | |||
Line of Credit Facility, Interest Rate at Period End | 5.10% | |||
Line of Credit Facility, Fair Value of Amount Outstanding | $ 0 | $ 0 | ||
Line of Credit Facility, Remaining Borrowing Capacity | 30,000,000 | |||
Line of Credit [Member] | Home Federal Savings Bank [Member] | Long-term Debt [Member] | ||||
Debt Instrument [Line Items] | ||||
Term note | $ 30,000,000 | |||
Long-term Debt | $ 27,000,000 | |||
Total expansion project [Member] | ||||
Debt Instrument [Line Items] | ||||
Estimated expansion project costs | $ 42,000,000 |
Related Party Transactions (Det
Related Party Transactions (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)installmentshares | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Related Party Transaction [Line Items] | |||||
Number of units redeemed | shares | 25,860 | ||||
Due to former member | $ 30,000,000 | $ 30,000,000 | $ 30,000,000 | ||
Purchases from Related Party | 354,000 | $ 4,737,000 | 1,542,000 | $ 9,159,000 | |
Due to Related Parties | 3,000 | $ 3,000 | |||
Director [Member] | |||||
Related Party Transaction [Line Items] | |||||
Number of units redeemed | shares | 25,860 | ||||
Due to former member | $ 30,000,000 | $ 30,000,000 | |||
Number of payment installments | installment | 2 |
Supply Commitments (Details)
Supply Commitments (Details) tons in Thousands, gal in Thousands, lb in Millions | 6 Months Ended |
Jun. 30, 2018gallbtons | |
Supply Commitment [Line Items] | |
Automatic renewal period | 1 year |
Period of written notice prior to current term expiration | 90 days |
Ethanol [Member] | Supply Commitment [Member] | |
Supply Commitment [Line Items] | |
Supply Commitment, Minimum Amount at Varying Fixed Price, Gallons | 2,765 |
Supply Commitment, Minimum Amount at Basis Price Levels, Mass | 43,000 |
Corn Oil [Member] | Supply Commitment [Member] | |
Supply Commitment [Line Items] | |
Supply Commitment, Remaining Minimum Amount Committed, Weight | lb | 11.3 |
Distillers Grains [Member] | Supply Commitment [Member] | |
Supply Commitment [Line Items] | |
Supply Commitment, Remaining Minimum Amount Committed, Weight | tons | 41 |
Related Party (Details)
Related Party (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | |||||
Revenue | $ 84,188,461 | $ 71,505,612 | $ 160,810,908 | $ 134,662,110 | |
Investor [Member] | |||||
Related Party Transaction [Line Items] | |||||
Equity Method Investments | 2,417,000 | 2,417,000 | $ 2,330,000 | ||
RPMG [Member] | |||||
Related Party Transaction [Line Items] | |||||
Related Party Transaction, Due from (to) Related Party | 3,861,000 | 3,861,000 | 236,000 | ||
CHS [Member] | |||||
Related Party Transaction [Line Items] | |||||
Related Party Transaction, Due from (to) Related Party | 1,797,000 | 1,797,000 | $ 900,000 | ||
Ethanol [Member] | Investor [Member] | |||||
Related Party Transaction [Line Items] | |||||
Sales | 63,999,000 | 58,806,000 | 123,172,000 | 109,528,000 | |
Marketing Fees | 66,000 | 61,000 | 132,000 | 123,000 | |
Distillers Grains [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue | 16,855,000 | 9,075,000 | 31,650,000 | 18,383,000 | |
Other Selling and Marketing Expense | 216,000 | 171,000 | 422,000 | 366,000 | |
Corn Oil [Member] | Investor [Member] | |||||
Related Party Transaction [Line Items] | |||||
Sales | 3,335,000 | 3,624,000 | 5,989,000 | 6,750,000 | |
Marketing Fees | $ 28,000 | $ 27,000 | $ 50,000 | $ 52,000 |
Purchase Commitments (Details)
Purchase Commitments (Details) bu in Thousands, MMBTU in Thousands, $ in Thousands | 6 Months Ended | |
Jun. 30, 2018USD ($)MMBTUbu | Jun. 30, 2017MMBTU | |
Corn [Member] | ||
Long-term Purchase Commitment [Line Items] | ||
Estimated expansion project costs | $ 23,856 | |
Long-term Purchase Commitment, Minimum Mass Required | bu | 4,333 | |
Public Utilities, Inventory, Fuel [Member] | ||
Long-term Purchase Commitment [Line Items] | ||
Long-term Purchase Commitment, Period | 12 months | |
Purchase Commitment, Remaining Minimum Amount Committed | $ 10,606 | |
Natural Gas [Member] | ||
Long-term Purchase Commitment [Line Items] | ||
Long-term Purchase Commitment, Minimum Energy Volume Required | MMBTU | 5,362 | 0 |
Purchase Commitments Schedule (
Purchase Commitments Schedule (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Public Utilities, Inventory, Fuel [Member] | |
Long-term Purchase Commitment [Line Items] | |
Long-term Purchase Commitment, Period | 12 months |
Commitments, Contingencies, A33
Commitments, Contingencies, Agreements and Subsequent Events Construction Agreements (Details) - USD ($) $ in Millions | Aug. 14, 2018 | Jun. 30, 2018 |
Subsequent Event [Line Items] | ||
Construction contract, costs incurred to date | $ 1.2 | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Construction contract amount | $ 8.6 | |
Construction contract, outstanding commitments | $ 7.4 |
Lease Obligations (Details)
Lease Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Operating Leased Assets [Line Items] | ||||
Lease term (up to 5 years) | 5 years | 5 years | ||
Railroad Transportation Equipment [Member] | ||||
Operating Leased Assets [Line Items] | ||||
Operating Leases, Rent Expense | $ 379 | $ 371 | $ 753 | $ 781 |
Operating Lease Payments Due 2018 | 1,515 | 1,515 | ||
Operating Lease Payments Due 2019 | 1,515 | 1,515 | ||
Operating Leases Payments Due 2020 | 1,515 | 1,515 | ||
Operating Leases Payments Due 2021 | 1,515 | 1,515 | ||
Operating Leases Payments Due 2022 | 323 | 323 | ||
Total Operating Lease Payments Due | $ 6,383 | $ 6,383 |
Derivative Instruments Derivati
Derivative Instruments Derivative Instruments (Details) bu in Millions | 6 Months Ended |
Jun. 30, 2018bu | |
Corn [Member] | |
Derivative [Line Items] | |
Concentration Risk, Amount of Material | 63 |
Designated as Hedging Instrument [Member] | Corn [Member] | |
Derivative [Line Items] | |
Derivative, Nonmonetary Notional Amount, Percent of Required Need, Coverage | 13.00% |
Designated as Hedging Instrument [Member] | Corn [Member] | Maximum [Member] | |
Derivative [Line Items] | |
Derivative, Nonmonetary Notional Amount, Percent of Required Need, Yearly Average | 25.00% |
Designated as Hedging Instrument [Member] | Corn [Member] | Minimum [Member] | |
Derivative [Line Items] | |
Derivative, Nonmonetary Notional Amount, Percent of Required Need, Yearly Average | 10.00% |
Derivative Instruments - Income
Derivative Instruments - Income Statement (Details) - Commodity Contract [Member] - Not Designated as Hedging Instrument [Member] - Cost of Sales [Member] - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments, Realized Gain (Loss) Recognized in Income | $ 737 | $ 221 | $ (405) | $ 255 |
Derivative Instruments, Unrealized Gain (Loss) Recognized in Income | 2,509 | 49 | 1,743 | (43) |
Derivative Instruments, Gain (Loss) Recognized in Income | $ 3,246 | $ 270 | $ 1,338 | $ 212 |
Derivative Instruments - Balanc
Derivative Instruments - Balance Sheet (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Good Faith and Margin Deposits with Broker-Dealers | $ (1,334) | |
Other Receivables from Broker-Dealers and Clearing Organizations | $ 457 | |
Derivative Instruments Not Designated as Hedging Instruments, Asset, at Fair Value | 709 | 755 |
Commodity Contract [Member] | Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset, Fair Value, Gross Asset | 2,096 | 305 |
Commodity Contract [Member] | Other Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability, Fair Value, Gross Liability | $ (53) | $ (7) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Director [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term Debt, Gross | $ 27,000 | |
Long-term Debt, Fair Value | 26,652 | |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt Securities, Trading, and Equity Securities, FV-NI | 30,107 | $ 30,203 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt Securities, Trading, and Equity Securities, FV-NI | 30,107 | 30,203 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt Securities, Trading, and Equity Securities, FV-NI | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt Securities, Trading, and Equity Securities, FV-NI | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative Asset | 2,096 | 305 |
Derivative Liability | (53) | (7) |
Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative Asset | 2,096 | 305 |
Derivative Liability | (53) | (7) |
Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative Asset | 0 | 0 |
Derivative Liability | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Commodity Contract [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative Asset | 0 | 0 |
Derivative Liability | $ 0 | $ 0 |