What changed in this filing

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Item 1. Business

2021-11-04 compared with 2020-11-05 · 140 added, 66 removed, 164 unchanged (56% of the section changed)

(referred to herein as "CHS," "we," "us" or "our") is the nation’s leading integrated agricultural cooperative, providing grain, foods and energy resources to businesses and consumers on a global basis.

As a cooperative, we are owned by farmers and ranchers and their member cooperatives (referred to herein as "members") across the United States.

We also have preferred shareholders that own shares of our five series of preferred stock, which are each listed and traded on the Global Select Market of The Nasdaq Stock Market LLC ("The Nasdaq").

(referred to herein as "CHS," "we," "us" or "our") is the nation’s leading integrated agricultural cooperative, providing grain, food, agronomy and energy resources to businesses and consumers on a global basis.

As a cooperative, we are owned by farmers and ranchers and member cooperatives (referred to herein as "members") across the United States.

We also have preferred shareholders that own shares of our five series of preferred stock, all of which are listed and traded on the Global Select Market of The Nasdaq Stock Market LLC.

We buy commodities from and provide products and services to individual agricultural producers, local cooperatives and other companies (including our members and other nonmember customers), both domestically and internationally.

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rather, a proportionate share of the income or loss from those equity investments and joint ventures is included as a component of our net income using the equity method of accounting.

For the year ended August 31, 2020, our total revenues were $28.4 billion and net income attributable to CHS Inc.

was $422.4 million.

For the year ended August 31, 2021, our total revenues were $38.4 billion and net income attributable to CHS was $554.0 million.

We have aligned our segments based on an assessment of how our businesses operate and the products and services they sell.

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Our Ag segment also records equity income from our grain export joint venture and other investments.

Our Nitrogen Production segment consists solely of our equity method investment in CF Industries Nitrogen, LLC ("CF Nitrogen").

Our Nitrogen Production segment consists of our equity method investment in CF Industries Nitrogen, LLC ("CF Nitrogen"), and allocated expenses.

Our Foods segment consists of our equity method investment in Ventura Foods, LLC ("Ventura Foods"), and allocated expenses.

Our other business operations, primarily our financing and hedging businesses, are included in Corporate and Other because of the nature of their products and services, as well as the relative amount of revenues from those businesses.

Prior to its sale on May 4, 2018, our insurance business was also included in Corporate and Other.

In addition, our nonconsolidated wheat milling and food production and distribution joint ventures are included in Corporate and Other.

In addition, our nonconsolidated wheat milling joint venture is included in Corporate and Other.

Prior to August 31, 2021, our equity method investment in Ventura Foods was reported as a component of Corporate and Other and, accordingly, reported segment results and balances prior to that time have been recast to reflect the addition of our Foods segment.

Our earnings from cooperative business are allocated to members (and to a limited extent to nonmembers with which we have agreed to do business on a patronage basis) based on the volume of business they do with us.

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We also receive patronage refunds from the cooperatives in which we are a member, if those cooperatives have earnings to distribute and if we qualify for patronage refunds from them.

Our origins date back to the early 1930s with the founding of our predecessor companies, Cenex, Inc.

and Harvest States Cooperatives.

Our origins date back to the early 1930s with the founding of our predecessor companies, Cenex, Inc., and Harvest States Cooperatives.

emerged as the result of the merger of those two entities in 1998 and is headquartered in Inver Grove Heights, Minnesota.

Our internet address is www.chsinc.com.

The information contained on our website is not part of, and is not incorporated in, this Annual Report on Form 10-K or any other report we file with or furnish to the SEC.

Table of Content s

The information contained on our website is not part of, and is not incorporated in, this Annual Report on Form 10-K or any other report we file with or furnish to the Securities and Exchange Commission ("SEC").

CHANGES FROM PRIOR PERIODIC REPORTS

In this Annual Report on Form 10-K, we have complied with the disclosures required by the SEC Release No.

33-10825 "Modernization of Regulation S-K Items 101, 103 and 105" and SEC Release No.

33-10890 "Management's Discussion and Analysis, Selected Financial Data and Supplementary Financial Information."

Modernization of Regulation S-K Items 101, 103 and 105

Following its effective date of November 9, 2020, we have adopted and incorporated changes to modernize the description of business, legal proceedings and risk factor disclosures that registrants are required to make pursuant to Regulation S-K promulgated by the SEC.

Specifically, we have provided additional disclosures relating to our human capital resources, restructured our risk factor disclosures and increased the threshold for disclosure of environmental proceedings to which the government is a party.

Management's Discussion and Analysis, Selected Financial Data and Supplementary Financial Information

Following its release in November 2020, we adopted and incorporated changes to modernize, simplify and enhance certain financial disclosure requirements in Regulation S-K promulgated by the SEC.

Specifically, the SEC eliminated the requirement for selected financial data, except for quarterly disclosures when there are retrospective changes affecting comprehensive income, and amended the matters required to be presented under Management's Discussion and Analysis of Financial Condition and Results of Operations to, among other things, eliminate the requirement of the contractual obligations table.

With the adoption of this release, we have eliminated the items discussed above that are no longer required from this Annual Report on Form 10-K.

Information on our contractual obligations is still disclosed in a narrative within the "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 7 of Part II of this Annual Report on Form 10-K.

We are the nation's largest cooperative energy company based on revenues and identifiable assets, with operations that include petroleum refining and pipelines;

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Our Laurel refinery processes approximately 55,000 barrels of crude oil per day to produce refined products that consist of approximately 41% gasoline, 40% diesel fuel and other distillates, 12% asphalt, 6% petroleum coke and 1% other products.

Refined fuels produced at our Laurel refinery are available via rail cars and via the Yellowstone Pipeline to western Montana terminals and to Spokane, Washington;

Refined fuels produced at our Laurel refinery are available via railcars and via the Yellowstone Pipeline to western Montana terminals and to Spokane, Washington;

south via common carrier pipelines to Wyoming terminals and Denver, Colorado;

and east via our wholly-owned Cenex Pipeline, LLC, to Glendive, Montana, and Minot, Prosper and Fargo, North Dakota.

and east via our wholly-owned Cenex Pipeline, LLC, to Glendive, Montana, and to Minot, Prosper and Fargo, North Dakota.

McPherson refinery.

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We sold approximately 1.5 billion gallons of gasoline and approximately 1.7 billion gallons of diesel fuel in fiscal 2021.

We also blend, package and wholesale auto and farm machinery lubricants to both members and nonmembers.

We also blend, package and wholesale auto and farm equipment lubricants to members and nonmembers.

We are one of the nation's largest propane wholesalers based on revenues.

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Annual sales volumes of propane vary greatly depending on weather patterns and crop conditions.

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The petroleum business is highly cyclical.

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Our Energy segment's operations are subject to laws and related regulations and rules designed to protect the environment that are administered by the U.S.

Environmental Protection Agency ("EPA"), the Department of Transportation ("DOT"), the U.S.

Environmental Protection Agency ("EPA"), the U.S.

Department of Transportation ("DOT"), the U.S.

Department of Transportation Pipeline and Hazardous Materials Safety Administration, the Federal Energy Regulatory Commission and similar government agencies.

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labeling of pesticides and similar substances;

and investigation and remediation of releases of hazardous materials.

and investigation and remediation of the release of hazardous materials.

Failure to comply with these laws, regulations and rules could subject us to administrative penalties, injunctive relief, civil remedies and possible recalls of products.

Our hedging transactions and activities are subject to the rules and regulations of the exchanges we use and governing bodies, such as the Chicago Mercantile Exchange ("CME"), the New York Mercantile Exchange ("NYMEX") and the U.S.

Our hedging transactions and activities are subject to the rules and regulations of the exchanges we use and to governing bodies, such as the Chicago Mercantile Exchange ("CME"), the New York Mercantile Exchange ("NYMEX") and the U.S.

Commodity Futures Trading Commission ("CFTC").

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Given the commodity nature of the end products, profitability in the industry depends largely on margins, as well as operating efficiency, product mix and costs of product distribution and transportation.

The retail gasoline market is highly competitive, with competitors that are much larger than us and that have greater brand recognition and distribution outlets throughout the country and the world than we do.

We are also experiencing increased competition from regional and unbranded retailers.

The retail gasoline market is highly competitive, with competitors that are much larger than CHS and have greater brand recognition and distribution outlets throughout the country and the world than we do.

We also are experiencing increased competition from regional and unbranded retailers.

Our owned and nonowned retail outlets are located primarily in the northwestern, midwestern and southern United States.

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The first area includes the Midwest and Northern Plains.

Competition at the wholesale level in this area includes major oil companies, as well as independent refiners and wholesale brokers/suppliers.

Competition at the wholesale level in this area includes major oil companies, as well as independent refiners and

wholesale brokers and/or suppliers.

This area has a robust spot market and is influenced by the large refinery center along the Gulf Coast.

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This area centers near Chicago, Illinois, and includes eastern Wisconsin, Illinois and Indiana.

In this area, we principally compete with the major oil companies, as well as independent refiners and wholesale brokers/suppliers.

In this area, we principally compete with the major oil companies, as well as independent refiners and wholesale brokers and/or suppliers.

Another market area includes Arkansas, Missouri and the northern part of Texas.

Competition in this area includes the major oil companies and independent refiners.

This area is principally supplied from the Gulf Coast refinery center and is also driven by a strong spot market that reacts quickly to changes in the international and national supply balance.

This area is principally supplied by the Gulf Coast refinery center and is also driven by a strong spot market that reacts quickly to changes in the international and national supply balance.

Another geographic area includes Montana, western North Dakota, Wyoming, Utah, Idaho, Colorado and western South Dakota.

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This area is known for volatile prices and an active spot market.

Table of Content s

Our Ag segment includes our global grain marketing, country operations, wholesale agronomy, processing and food ingredients and renewable fuels businesses.

Our Ag segment includes global grain and processing, country operations and wholesale agronomy businesses.

These businesses work together to facilitate the production, purchase, sale and eventual use of grain and other agricultural products within the United States, as well as internationally.

In fiscal 2020, revenues in our Ag segment were $22.9 billion after elimination of intersegment revenues, consisting principally of grain sales.

Global grain marketing.

In fiscal 2021, revenues in our Ag segment were $32.0 billion after elimination of intersegment revenues.

Global grain and processing.

We are the nation's largest cooperative marketer of grain and oilseed based on grain sales.

Our global grain marketing operations purchase grain directly from agricultural producers and elevator operators primarily in the midwestern and western United States and indirectly through our country operations business.

The purchased grain is typically contracted for sale for future delivery at a specified location, and we are responsible for handling the grain and either arranging for or facilitating its transportation to that location.

Purchased grain is typically contracted for sale for future delivery at a specified location, and we are responsible for handling the grain and either arranging for or facilitating its transportation to that location.

We own and operate export terminals, river terminals and elevators throughout the United States to handle and transport grain and grain products.

We also maintain locations in Europe, the Middle East, the Pacific Rim and South America for the marketing, merchandising and/or sourcing of grains and crop nutrients.

We also maintain locations in Europe, the Middle East, the Pacific Rim and South America for marketing, merchandising and/or sourcing grains and crop nutrients.

We primarily conduct our global grain marketing operations directly, but do conduct some of our operations through joint ventures, including TEMCO, LLC, a 50%-owned joint venture with Cargill, Incorporated ("Cargill"), focused on exports, primarily to Asia.

Our processing business includes our oilseed processing and renewable fuels production businesses.

Oilseed processing is conducted at facilities that can crush approximately 140 million bushels of oilseeds on an annual basis, producing approximately 2.9 million short tons of meal and flour and 1.8 billion pounds of edible oil annually.

We purchase our oilseeds from members, other CHS businesses and third parties that have tightly integrated connections with our global grain marketing operations and country operations business.

Our renewable fuels business produces 260 million gallons of fuel-grade ethanol, 75 million pounds of inedible corn oil and 640,000 tons of dried distillers grains with solubles ("DDGS") annually.

Renewable fuels produced by our production plants are marketed by our global grain marketing business, along with more than 504 million gallons of ethanol and 4 million tons of DDGS annually under marketing agreements with ethanol production plants.

Country operations.

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Most of these locations purchase grain from farmers and sell agronomy, energy, feed and seed products to those same producers and others, although not all locations provide every product and service.

We also manufacture animal feed through eight owned plants and four limited liability companies.

We also manufacture animal feed through eight of our owned plants and four limited liability companies.

Wholesale agronomy.

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The fertilizer is then shipped by rail to destinations within crop-producing regions of the United States.

Our wholesale crop protection business operates out of our network of 29 warehouses from which we deliver products directly to our member cooperatives and independent retailers.

Our wholesale crop protection business operates out of our network of 27 warehouses from which we deliver products directly to

our member cooperatives and independent retailers.

We also operate a bulk chemical rail terminal in Brooten, Minnesota, where we handle and store bulk crop protection products for some of the crop protection industry's largest chemical manufacturers.

This facility has approximately 6 million gallons of chemical storage capacity.

Processing and food ingredients.

Our processing and food ingredients operations are conducted at facilities that can crush approximately 115 million bushels of oilseeds on an annual basis, producing approximately 2.6 million short tons of meal/flour and 1.6 billion pounds of edible oil annually.

We purchase our oilseeds from members, other CHS businesses and third parties that have tightly integrated connections with our global grain marketing operations and country operations business.

Renewable fuels.

Our renewable fuels business produces 257 million gallons of fuel-grade ethanol, 60 million pounds of inedible corn oil and 636 thousand tons of dried distillers grains with solubles ("DDGS") annually.

Renewable fuels produced by our production plants are marketed by our global grain marketing business, along with more than 450 million gallons of ethanol and 3 million tons of DDGS annually under marketing agreements with ethanol production plants.

Products and Services

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We also produce refined oils, meal and soyflour at our processing facilities.

Table of Content s

Sales and Marketing;

Our Ag segment provides products and services to a wide range of customers, primarily in the United States.

These customers include member and nonmember producers, local cooperatives, elevators, grain dealers, grain processors and crop nutrient retailers.

These customers include member and nonmember producers, local cooperatives, elevators, grain dealers, grain processors and crop nutrient and crop protection retailers.

We sell our edible oils and soyflour to food companies.

The meal we produce is sold to integrated livestock producers and feed mills.

The soybean meal we produce is sold to integrated livestock producers and feed mills.

The ethanol and DDGS we produce are sold throughout the United States and to various international customers.

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Supply is affected by weather conditions, plant disease, insect damage, acreage planted and government regulations and policies.

Demand may be affected by foreign governments and their programs, relationships of foreign countries with the United States, affluence of foreign countries, acts of war, currency exchange fluctuations and substitution of commodities.

Demand may be affected by foreign governments and their programs, relationships of foreign countries with the United States, the affluence of foreign countries, acts of war, currency exchange fluctuations and substitution of commodities.

Demand may also be affected by changes in eating habits, population growth, per capita consumption of some products and renewable fuels production levels.

Our Ag operations are subject to laws and related regulations and rules designed to protect the environment that is administered by the EPA, the DOT and similar government agencies.

Our Ag operations are subject to laws and related regulations and rules designed to protect the environment and that are administered by the EPA, the DOT and similar government agencies.

These laws, regulations and rules govern, among other things, discharge of materials into the environment, including air and water;

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labeling of pesticides and similar substances;

and investigation and remediation of releases of hazardous materials.

and investigation and remediation of the release of hazardous materials.

In addition, environmental laws impose a liability on owners and operators for investigation and remediation of contaminated property and on a party who sends hazardous materials to those contaminated properties for treatment, storage, disposal or recycling.

In some instances, that liability exists regardless of fault.

Our global grain marketing operations, country operations business, processing and food ingredient operations and renewable fuel operations are also subject to laws and related regulations and rules administered by the U.S.

Our global grain and processing and country operations businesses are also subject to laws and related regulations and rules administered by the U.S.

Department of Agriculture, the U.S.

Food and Drug Administration and other federal, state, local and foreign governmental agencies that govern processing, packaging, storage, distribution, advertising, labeling, quality and safety of feed and grain products.

Failure to comply with these laws, regulations and rules could subject us to administrative penalties, injunctive relief, civil remedies and possible recalls of products.

The hedging transactions and activities of our global grain marketing, country operations, processing and food ingredient and renewable fuels businesses are subject to the rules and regulations of the exchanges we use and governing bodies, such as the CME, the Chicago Board of Trade ("CBOT"), the Minneapolis Grain Exchange ("MGEX") and the CFTC.

The hedging transactions and activities of our global grain and processing and country operations businesses are subject to the rules and regulations of the exchanges we use and to the governing bodies, such as the CME, the Chicago Board of Trade ("CBOT"), the Minneapolis Grain Exchange ("MGEX") and the CFTC.

In our Ag segment, we have significant competition in the businesses in which we operate based principally on price, services, quality, patronage and alternative products.

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NITROGEN PRODUCTION

Our Nitrogen Production segment consists solely of our approximate 10% membership interest (based on product tons) in CF Nitrogen, our strategic venture with CF Industries Holdings, Inc.

("CF Industries").

Our Nitrogen Production segment consists of our approximate 10% membership interest (based on product tons) in CF Nitrogen, our strategic venture with CF Industries Holdings, Inc.

("CF Industries"), and allocated expenses.

In connection with our investment in CF Nitrogen, we entered into a supply agreement with CF Nitrogen that entitles us to purchase up to 1.1 million tons of granular urea and 580,000 tons of urea ammonium nitrate ("UAN") annually for ratable delivery through fiscal 2096.

We account for our CF Nitrogen investment using the hypothetical liquidation at book value method and on August 31, 2020, our investment was approximately $2.7 billion.

We account for our CF Nitrogen investment using the hypothetical liquidation at book value method.

On August 31, 2021, our investment was approximately $2.7 billion.

See Note 6, Investments , of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

Our investment in CF Nitrogen positions us and our members for long-term, dependable fertilizer supply, supply chain efficiency and production economics.

In addition, the ability to source product from CF Nitrogen production facilities under our supply agreement benefits our members and customers through strategically positioned access to essential fertilizer products.

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CF Nitrogen has four production facilities located in Donaldsonville, Louisiana;

In addition, the ability to source products from CF Nitrogen production facilities under our supply agreement benefits our members and customers through strategically positioned access to essential fertilizer products.

CF Nitrogen has six production facilities located in Donaldsonville, Louisiana;

Port Neal, Iowa;

Medicine Hat, Alberta, Canada;

Yazoo City, Mississippi;

and Woodward, Oklahoma.

and Woodward and Verdigris, Oklahoma.

Natural gas is the principal raw material and primary fuel source used in the ammonia production process.

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handling and disposal of wastes and other materials;

and investigation and remediation of releases of hazardous materials.

and investigation and remediation of the release of hazardous materials.

In addition, environmental laws impose a liability on owners and operators for investigation and remediation of contaminated property and on a party that sends hazardous materials to those contaminated properties for treatment, storage, disposal or recycling.

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There is also significant competition from products sourced from other regions of the world.

Our Foods segment consists of our equity investment in Ventura Foods and allocated expenses.

Ventura Foods is a joint venture between CHS and Mitsui & Co., with each company owning 50% interest.

We account for our investment in Ventura Foods using the equity method of accounting, and the investment balance was equal to $388.6 million on August 31, 2021.

See Note 6, Investments , of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

Ventura Foods currently has 16 manufacturing and distribution locations across the United States and Canada.

Ventura Foods sources its raw materials, which consist primarily of soybean oil, canola oil, palm and/or coconut oil, peanut oil and other ingredients and supplies, from various domestic and international suppliers, including our oilseed processing operations.

Products and Services

Ventura Foods produces and distributes edible, oil-based products, including packaged oils, margarines, flavored dressings and sauces, mayonnaises and other food products.

In addition to products for which Ventura Foods owns the brand, Ventura Foods also produces a variety of nonbranded items and products for third parties.

Some of the products produced and distributed by Ventura Foods have product formulations and processes that are proprietary to either Ventura Foods or its customers.

Sales and Marketing;

Ventura Foods sells its products to foodservice distributors, retail outlets and secondary manufacturers who use edible oils as ingredients in products they manufacture for resale.

Ventura Foods is subject to laws and related regulations and rules designed to protect the environment that are administered by the EPA, the DOT and similar government agencies.

These laws, regulations and rules govern the discharge of materials into the environment, air and water;

reporting storage of hazardous wastes and other hazardous materials;

the transportation, handling and disposal of wastes and other materials;

and the investigation and remediation of the release of hazardous materials.

In addition, environmental laws impose a liability on owners and operators for investigation and remediation of contaminated property, and a party who sends hazardous materials to those contaminated properties for treatment, storage, disposal or recycling.

In some instances, that liability exists regardless of fault.

Ventura Foods is also subject to laws and related regulations and rules administered by the USDA, the FDA and other federal, state, local and foreign governmental agencies that govern the processing, packaging, storage, distribution, advertising, labeling and the quality and safety of food products.

Failure to comply with these laws, regulations and rules could subject Ventura Foods to administrative penalties, injunctive relief, civil remedies and possible recalls of products.

Competition .

Ventura Foods competes with a variety of companies in the food manufacturing industry.

Competitors in the oils segment of the business include multinational oilseed processing companies as well as smaller oil packaging firms.

Ventura Foods also competes with large consumer packaged goods companies and smaller regional manufacturers that produce margarines, flavored dressings and sauces, and mayonnaises for the foodservice, retail and industrial sectors.

Competitive dynamics vary by product category.

In commodity categories such as oils, price and service are significant factors in customer decisions.

For value-added products, such as dressings and sauces, service and culinary capabilities play a larger role in securing new business and maintaining customer relationships.

CORPORATE AND OTHER

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We hold a 12% interest in Ardent Mills and account for our investment as an equity method investment due to our ability to exercise significant influence through our ability to appoint a member of the Board of Shareholders and Board of Managers of Ardent Mills.

On August 31, 2020, our investment in Ardent Mills was $208.9 million.

See Note 6, Investments , of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

Ventura Foods, LLC ("Ventura Foods"), is a joint venture between CHS and Wilsey Foods, Inc., a majority-owned subsidiary of MBK USA Holdings, Inc., with each company owning 50% interests.

Ventura Foods produces vegetable oil-based products, such as packaged frying oils, margarines, mayonnaises, sauces, salad dressings and other food products, and currently has 16 manufacturing and distribution locations across the United States and Canada.

Ventura Foods sources its raw materials, which consist primarily of soybean oil, canola oil, palm/coconut oil, peanut oil and other ingredients and supplies, from various domestic and overseas suppliers, including our oilseed processing operations.

We account for our investment in Ventura Foods using the equity method of accounting and, on August 31, 2020, our investment was $381.4 million.

On August 31, 2021, our investment in Ardent Mills was

$220.1 million.

See Note 6, Investments , of the notes to the consolidated financial statements that are included in this Annual Report on Form 10-K for additional information.

Table of Content s

On August 31, 2020, we had 10,493 full-time, part-time, temporary and seasonal employees.

HUMAN CAPITAL RESOURCES

Our human capital resources objectives include identifying, attracting, retaining, developing, incentivizing and onboarding our current and new employees.

We monitor our progress toward these objectives by measuring human capital metrics such as engagement, total and regrettable turnover, hiring statistics and overall cost of human resources delivery.

In addition to these objectives, we also promote a culture focused on diversity and inclusion, provide learning and development opportunities, maintain the health and safety of our employees, encourage community involvement and offer competitive pay and benefits.

Additional information regarding our employee population and human capital strategies is described below.

Employee Population .

On August 31, 2021, we had 9,941 full-time, part-time, temporary and seasonal employees, primarily in the United States.

Of that total, 2,391 were employed in our Energy segment, 6,476 were employed in our Ag segment and 1,074 were employed in Corporate and Other.

In addition to those individuals directly employed by us, many individuals work for our joint ventures, including employees of CF Nitrogen in our Nitrogen Production segment and Ventura Foods and Ardent Mills in our Corporate and Other category, and are not included in these totals.

Labor Relations

As of August 31, 2020, we had 12 collective bargaining agreements with unions covering approximately 8% of our employees in the United States, which expire on various dates through May 31, 2024.

In addition to those individuals directly employed by us, many individuals work for or support our joint ventures, including CF Nitrogen in our Nitrogen Production segment, Ventura Foods in our Foods segment and Ardent Mills in our Corporate and Other category, and are not included in these totals.

As of August 31, 2021, we had 12 collective bargaining agreements with unions covering approximately 9% of our employees in the United States, with collective bargaining agreements expiring on various dates through June 30, 2026.

We believe that our relations with our employees are strong.

We value our employees and believe that employee passion for our work and employee engagement are key elements of our operating performance.

Diversity and Inclusion .

The CHS value of inclusion helps us strive to create a work environment where excellence and growth stem from diverse thinking.

Our goal is to foster a workplace where diverse thinking, voices and backgrounds yield better employee experiences, business performance and business outcomes.

In addition to working on modeling inclusive behaviors that positively impact our communities, with the assistance of external experts, we developed and launched an enterprisewide, three-year strategic plan during fiscal 2021 for improving inclusion and diversity at CHS.

We continue to sponsor and support employee resource groups made up of individuals who join together as allies and advocates to promote diversity and inclusion, while providing our employees from across the country the opportunity to strengthen relationships, learn through educational and networking opportunities that focus on development, help local communities and engage with people across CHS.

These employee resource groups include Harvest Pride, which promotes a safe, connected and empowered LGBTQA+ community across CHS;

Mozaiko, which promotes ethnic diversity and inclusion at CHS while creating an inclusive environment for all employees;

a veterans employee resource group that provides support, camaraderie and resources for employees formerly serving or currently serving in the military;

and Women in Leadership, which supports women in the workplace who are excited and energized to grow personally and professionally.

Learning and Development .

We are committed to investing in our employees to help them grow and achieve their career goals.

In addition to regular performance evaluations and annual development plans that provide employees with feedback and growth opportunities, employees at CHS have access to a variety of learning tools and other opportunities for growth.

These tools and opportunities include access to thousands of on-demand learning modules;

various internally- and externally-led trainings that cover continuous improvement, public speaking, financial and accounting topics and other topics;

tuition and professional certification reimbursement;

as well as other opportunities focused on developing the future leaders of CHS.

With the ongoing COVID-19 pandemic during fiscal 2020 and fiscal 2021, many of these opportunities for learning and development were adjusted to a virtual delivery model to ensure that employee development could continue in a safe manner.

Health and Safety .

Safety is one of our core values.

We put the well-being of our employees, customers and communities first every day.

At CHS, safety isn’t just about following the rules, it is about doing things the right way and remembering that no job is so critical that it warrants safety risks.

In addition to defined safety programs designed specifically for individual facilities with operational hazards such as grain, feed, seed, agronomy, petroleum, warehouses and retail stores, we also provide certain employee groups with additional training opportunities such as a defensive driving program.

Beyond developing defined safety programs and training opportunities, we also monitor our incident rates in comparison to previous years and industry averages, as published by the Bureau of Labor Statistics.

During fiscal 2021, our Occupational Safety & Health Administration ("OSHA") incident rate was 2.8 incidents per 100 full-time workers, as compared to an average of 3.6 incidents per 100 full-time workers during the three previous years, a reduction of 22%, and our DOT crash rate was in the top 1% of all carriers in our industry segment for the entirety of fiscal 2021.

Beginning in February 2020 and throughout the course of the COVID-19 pandemic, our Environmental Health and Safety team continuously monitored and assessed the evolving situation, while implementing safety precautions to protect the health and well-being of our employees, customers and communities, including the use of personal protective equipment, facility cleaning and sanitation protocols and remote work initiatives for employees whose roles could be conducted remotely.

Community Involvement .

As a cooperative, we are committed to making a measurable impact in our communities through our giving investments.

In addition to our charitable foundation and annual giving campaign, which provide financial support to our communities, eligible employees also receive paid time off to make a difference in our communities through volunteer activities.

Compensation and Benefits .

We have designed our compensation and benefits programs to attract and retain qualified employees and to motivate employees to optimize member-owner returns and to achieve our long-term strategies.

In addition to offering competitive compensation that includes annual variable pay linked to our performance, we also offer a wide array of benefits programs that include health insurance and wellness benefits;

retirement benefits including a company-matched 401(k) contribution and a pension for qualifying employees;

paid time off and family leave;

and employee assistance programs, including adoption assistance.

CHS AUTHORIZED CAPITAL

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business