Form 8-K CHS INC For: Dec 02

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): December 2, 2016

CHS Inc.

(Exact Name of Registrant as Specified in Charter)

Commission File Number: 001-36079

5500 Cenex Drive
Inver Grove Heights, Minnesota 55077
(Address of Principal Executive Offices) (Zip Code)

(651) 355-6000
(Registrant’s telephone number, including area code)

Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01.             Regulation FD Disclosure.

On December 2, 2016, Carl Casale, President and Chief Executive Officer of CHS Inc. (the “Company”), Timothy Skidmore, Executive Vice President and Chief Financial Officer of the Company, and David Bielenberg, Chairman of the Board of Directors of the Company, each gave a speech along with a related slide presentation at the Company’s 2016 Annual Meeting. Copies of Mr. Casale’s speech and related slide presentation are attached hereto as Exhibits 99.1 and 99.2, respectively, copies of Mr. Skidmore’s speech and related slide presentation are attached hereto as Exhibits 99.3 and 99.4, respectively, and copies of Mr. Bielenberg’s speech and related slide presentation are attached hereto as Exhibits 99.5 and 99.6, respectively. Each such copy is incorporated herein by reference.

Pursuant to General Instruction B.2. to Form 8-K, the information set forth in this Item 7.01 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

Item 9.01.             Financial Statements and Exhibits.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

3

Exhibit 99.1

Good morning.

So far today our focus has been on the tangibles. Financial reports. Business performance. Company governance.

We’ve talked about today’s challenging ag economy and the likelihood it will be with us for a few years. And we’ve reinforced our commitment to keeping CHS financially sound, while continuing to deliver the value that helps you grow.

In my time with you today I want to talk about what will drive our future — together. The essential foundations of our cooperative system. These are the actions we must take to ensure that this system remains strong and solidly positioned as the first choice for not only today’s owners, but for generations to come.

It’s hard to believe that I am now in my seventh fiscal year with CHS.

1

If you’d asked me when I took this job what sets CHS apart, I’d have said it’s our business structure. This model is much more than an investment. It connects you to an opportunity for direct economic benefit based on the business you do with the company you own.

That has remained true, but seven years in, I want to reflect on a second essential difference.

It’s passion.

The passion that comes with being not only a customer, but also an owner.

The passion for having a voice in governance.

A passion that connects the past, the present and the future. The great-grandfathers who founded this system. The grandparents and parents who have made it what it is today. And the sons, daughters, grandchildren and, hopefully, great-grandchildren who will count on it tomorrow.

2

There’s no question that our owners — and that includes our 1,100 member cooperatives and our 75,000 direct producer owners — have a tremendous passion for CHS and the cooperatives that serve them in their home communities.

You only need to look around this room to see it. In a typical publicly traded company, a small group might gather in a meeting room for a short time to check the box on the legally required annual meeting.

Not at CHS.

In this auditorium, we have nearly 2,000 owners who’ve come from across the country — on your own dime — to spend two days with us. You come to participate in this company’s governance, but you come for much more. You come to learn at more than four dozen education sessions. You come to speak up, through the resolutions process and the member interaction session we’ll have later today. You come to connect personally — with one another and with your CHS leaders.

3

You come because you care. Not just about what’s happening today, but about what may happen tomorrow. You care about making sure this cooperative system, now nearly nine decades old, remains successful for many decades to come.

It’s that passion that sets us apart and is our solid foundation. But it also means that, as we move forward, we need to do it together.

So today I want to tell you why — even in this downturn — I’m optimistic about our future and what we can accomplish together.

I’ll start with why I’m optimistic.

Even in this downturn, the world is still growing — in two ways. First, although China’s rapid economic expansion has slowed, it’s still growing. So is India’s. Significant segments of their emerging middle-class populations have gotten a taste — literally — of a better diet. Their demand for both vegetable and meat protein will continue to grow in the coming decades.

4

Second, where do you think the greatest population growth will be between now and 2100 — 84 years from now?

Not Asia. It’s Africa. And while food self-sufficiency is a laudable goal, in my opinion it will take many decades — yes, I said decades, not years — before centuries-old farming practices can be replaced by the right knowledge, infrastructure, economics and government policy needed to drive self-sufficiency.

In the meantime, the rest of the world’s farmers led, as always, by U.S. farmers, will be called on to feed sub-Saharan Africa.

So while cycles will always be with us, as farmers, ranchers and the cooperatives who serve them, we’ve got plenty of opportunity ahead.

Which brings me to my own list of leadership essentials.

Leading the list, of course, are our business priorities for 2017. Tim did a great job reinforcing our commitment to keeping CHS strong

5

and laying out our business and operational priorities, which include optimizing our Return on Assets, managing expenses, and maximizing the role of our enterprise technology platform and shared services. But there’s one priority that supersedes all of these — Safety.  I join our entire leadership team in stating unequivocally that safety is our first priority. Every day.

Two other priorities touch our owners and customers directly. The first is just that — customer engagement. While you may be a CHS owner, as a customer you always have a choice of who will supply you, support your business needs and market on your behalf. Throughout CHS, we’re focused on not only finding ways to serve you more efficiently and economically in a challenging market, but also in identifying new ways we can help you capture growth opportunities. That includes managing risk, something both producers and cooperatives list as their top business need. I’m very excited about some of the tools we have in development to meet this need.

Our second 2017 priority is talent development. Demographics are rapidly changing as baby boomers exit the workforce — on the farm,

6

at your co-op and CHS. Technology is constantly evolving. As our keynote speaker told us yesterday, we operate in a dynamic geopolitical environment. There’s only one way to address these challenges. Make sure we have the right people ready for the job. That’s true from the person who drives a spray rig to the leaders throughout the cooperative system.

This change, driven by the passage of time, may make us uncomfortable. However, we must embrace it and shape the future we desire, rather than be shaped by the future we’ll have if we are not proactive.

Even as we manage expenses, we know talent development must be a priority. Our leadership team has ensured that dollars are reserved for employee learning and to help us identify promising future leaders. We’re also addressing your talent needs, not only through recruiting, but by extending our robust CHS Leadership Academy offerings to cooperative teams. And in February, Your CHS Experience will give cooperative directors an outstanding development opportunity of their own.

7

While those are two priorities we identified, I want to share one more. It came from you, our owners. We heard you and we acted.

You said: Help us tell the cooperative story. We want help building owner pride. We want our communities to understand the value we deliver. We need to tell our story to engage the next generation as customers and owners.

Our response: The Value of the Cooperative tool kit, including ads and other materials distributed to more than 800 cooperatives. We’re delighted that more than a third of you are using them, and are giving us great feedback.

And we’re not done. We’ll continue to provide you with resources that help you tell YOUR cooperative value story and build essential connections to today’s owners and tomorrow’s. This new video is an example.

8

Beyond the great passion in our owners’ stories, we’ve now got the numbers that quantify the cooperative value story. This fall we wrapped up a comprehensive, data-driven project that measures CHS economic impact in the U.S. and in every state. We now know our employment impact — both in jobs we create directly and those resulting from things we buy, sell, build, and improve. We also tallied the cash we return to owners, our capital investments, taxes, the giving we do in our communities and more.

The bottom line? The extent of the economic impact far surpassed our expectations. To give just one example, our employment multiplier of 5 is more than twice the national average of 2.4 times.

Essentially, for every CHS job, we’re supporting the creation of four more in the community.

While these figures are specific to CHS, there’s value in them for all of our owners. For example, we’ll use them to tell our economic local, state and national impact story to elected officials, regulators and others. This gives you a voice and leverage on matters that impact

9

your operations, like new regulations. You can find more information about this economic impact study results on the CHS website.

In telling the cooperative value and economic impact stories over the past few months, it’s become even clearer to me why we do what we do as a system.

Rural economic sustainability.

Sustainability is a word you hear a lot, mostly in conjunction with the environment and food systems. And there’s no question both of these sustainability topics are vitally important. CHS is involved in numerous programs and organizations that support agronomic best practices, and advance the role of data in production ag. Through our own agronomic products, services and experts, we’re always finding new ways to add value for our owners. Ultimately, I believe the key is connecting producers to simple crop production solutions supported by trusted advisors that address both economics and sustainability.

10

We’re also part of a National Council of Farmer Cooperatives’ comprehensive initiative related to co-ops and sustainability. This includes development of a guide to best practices for co-op sustainability programs and tools to help us all tell the cooperative sustainability story.

But — to return to my earlier theme of global agricultural opportunity — while we know there are still significant areas on this planet that struggle to produce enough food, the rest of us are trying to do it in ways that address environmental, economic and consumer needs.

So let’s return to the cooperative business model and the economic value story. At the risk of over-simplifying, I think the answer is clear. Strong rural communities with strong farm families are the foundation of protecting the environment. When we provide them with the economics, efficiency, tools and experts to get the job done, sustainability is a natural outcome.

11

Isn’t that the essence of what we’re about as a cooperative system? When producers succeed, the environment succeeds, our rural communities succeed and the cooperative system succeeds.

As I wrap up, I want to leave you with one more essential and a call to action.

When I began, I talked about the differences between being a traditional public company and being a cooperative. I’ll add one more that’s actually considered a core cooperative principle.

Communication.

Over the past year, I’ve made communication with our owners my priority. I’ve spent 42 days on the road, meeting with cooperative CEOs, general managers and boards. It’s a part of my job I really enjoy, and it’s important to hear what’s on your minds. I’ve received and made dozens of phone calls. And I’ve talked to countless others of you in informal settings and by phone.

12

This past summer, members of my senior team joined me at ten Your CHS Town Hall meetings to present company updates and connect with you. We reached out in advance to learn what was on the minds of owners in different geographies to make these meetings more relevant. We’ll soon start planning the 2017 events. Our goal is to make them even more valuable to you. When you get the schedule, I encourage you to bring more of your local member-owners including those from the next generation. As I said, engagement is a two-way street, so we want your questions.

We also have quarterly calls to update our owners on the performance of your business. We’re pleased that about 500 of you participate each quarter, but we encourage all of our owners to call in and ask questions. You can literally ask us anything you want and we’ll answer simply and transparently.

Yesterday we tried something new in the Expo area. More than 140 of you joined me and members of my senior team for informal coffee and conversation sessions. We learned a lot about what was on your

13

minds. In fact, I’ll be touching on some of those conversations during the Q and A session in a few moments.

Throughout the year, we create additional opportunities to stay informed and connected. We want to know what’s on your minds. There’s a biweekly e-newsletter. We send out e-blasts with breaking news. We update the news on the CHS website nearly every day.

But here’s the reality, as I mentioned earlier, relative to this system’s total number of managers and directors, only a small percentage of our owners choose to engage in meetings, calls and other updates.

So here’s my challenge to you. Commit to attending update meetings. Commit to listening to the quarterly update call. Commit to getting on the list for our electronic news updates.  Commit to sharing feedback.

This is your cooperative. You own it.  We work for you. We’ve made communication with our owners a priority. Let’s make 2017 the year of two-way communication. With the pace of change and market

14

uncertainty, we need to stay connected through news and opportunities for give-and-take.

We’re making it easy. Take out the card the ushers gave you when you came in.

Hold it up.

Let’s all commit to staying in touch as owners and as those of us at CHS who serve you. Now please fill it out and give it back to the ushers before you leave. We’ll make sure we do our part to keep you connected to the company you own.

Two-way communication. It’s Essential to Leadership.

Since 2011, we’ve laid a strong foundation for the future. We’ve made tremendous investments to serve you at home and connect you to the global marketplace. We’ve delivered unprecedented economic returns. We’re leveraging talent and technology for the future.

15

Now we’re using our new market reality to make us better. We’re making sure our system is stronger and that we are more efficient. That our businesses and assets are delivering for you. That we’re financially sound.

Times may change, but, as the writer Samuel Beckett says: “The essential doesn’t change.”

That’s been true since this company was created.

We’re here to add value for our owners. We’re here to help you grow. We’re here for you today. And we’ll be here for you tomorrow.

16

Exhibit 99.2

Exhibit 99.3

Good morning.

As it has been for each of the last three years, I’m honored and privileged to deliver this year’s financial report.

This year’s annual meeting theme tells us to focus on The Essentials.

When these words come from me, most of you are naturally expecting me to talk about financial essentials. Results. Business performance. Margins. Cash returns. Financial ratios.

Don’t worry. I’ll get to all that.

First, however, I want to talk about what’s really essential.

Recently I had the chance to get out of the office for a couple days. I piled into a Tahoe with members of our finance team and we made the long drive, almost to the Canadian border, to Hallock, Minnesota. Our road trip took us to the CHS canola processing plant. This facility was

1

conceived and built by local investors who had deep roots in the area. It became part of CHS Processing and Food Ingredients in July 2015.

With CHS as its owner, this facility is now better able to originate canola oilseed and market canola oil, including to customers like Ventura Foods.

While we were doing our business review, I had the great pleasure of meeting many of our more than four dozen Hallock employees. Their commitment and dedication to serving our farmer-owners and their rural community was tangible and inspiring. They are proud to be on this great farmer-owned cooperative system team. They are proud to be part of CHS.

I learned about the value CHS adds for producers each year by processing about 400,000 tons of canola seed and turning it into canola oil and canola meal. Hallock’s patrons are enthusiastic about the CHS connection to consumer markets through Ventura Foods and others. And these producers recognize the value of being owners of a business that makes them eligible for direct economic returns not

2

only on processing, but also on the inputs they buy to raise their crop.

Finally, on this road trip I was able to engage with four talented next generation CHS finance leaders. I was impressed.

For me, road trips like this are far more than conducting business reviews or touring CHS facilities.

It’s a very meaningful reminder to me of what’s really essential and why we do what we do each day. A reminder that while my day job includes building and protecting our balance sheet and signing financial reports filed with the SEC, the real essential is the people.

These numbers I will discuss today represent the value CHS adds for our owners at member cooperatives and on farms and ranches across this great country. They reflect the efforts of our dedicated, hard-working employees. And, importantly, CHS financial results are tangible evidence of the benefit of being part of a company you own.

3

So when I come into the office each day, the essential image in my mind is YOU, the people who make up this great agricultural cooperative business and my responsibility for helping to keep the company you own financially sound and successful, as measured by a strong balance sheet and returns on your investment.

Now it’s time to get to the fiscal 2016 numbers.

There’s no question that what I’ll review with you this morning represents a very different year from my first three at this podium. I bet we can all agree on that. After years of enjoying robust growth and strong financial performance, our industries are in a down cycle and we cannot predict how long this down cycle will last.

From a financial management perspective, that means we step back and focus on what matters most — The Essentials.

I’ll start with a summary. It was a challenging year indeed. Both our earnings and revenues declined by double-digit percentages during fiscal 2016 versus 2015.

4

And, as you might expect, this was largely the result of the ongoing down cycles within global agriculture and energy. Fiscal 2016 gave us lower commodity prices and thin margins which affected significant portions of our businesses.

But amid these challenging market conditions, we stuck to our essential focus — what I call “controlling the controllables.” That means focusing on what is within our control to make sure CHS, your company, remains financially sound, with a strong balance sheet, returns above the cost of capital and positioned for future growth opportunities.

For fiscal 2016, which began on September 1st, 2015, and wrapped up on August 31st, 2016, we reported net income of $424.2 million. That’s down 46 percent from $781 million for fiscal 2015 and reflects lower pre-tax earnings within our Energy and Ag segments, as well as the Corporate and Other category. The lower pre-tax earnings within Energy and Ag were partly offset by increased pretax earnings in our Foods segment, as well as seven months of earnings generated by

5

our February 2016 strategic investment in CF Industries Nitrogen LLC — which I’ll refer to from here on out as CF Nitrogen.

Given the lower prices for the energy, grains and fertilizer products that comprise much our business, as you’d expect our revenues also declined in 2016 to $30.3 billion. That’s down 12 percent from $34.6 billion for fiscal 2015.

We’ll now take a brief look at results from each of our CHS businesses.

For Energy, year-over-year pre-tax earnings declined 49 percent to $275.4 million for fiscal 2016. That was primarily due to significantly lower refining margins for the company’s two refineries. Earnings for the CHS Transportation business also declined.

Within Energy, two of our businesses set earnings records in 2016. Propane’s performance was significantly better than fiscal 2015, which was a challenged year because both crop drying and winter

6

heating demands were down. And, CHS Lubricants reported its second consecutive year of record earnings.

The Ag segment includes our agricultural inputs, grain marketing, local retail and processing businesses. Here we posted fiscal 2016 pre-tax income of $30.9 million. That’s down 79 percent from fiscal 2015. As you may recall, fiscal 2015 included a $116.5 million one-time impairment charge due to our decision to end the development of a nitrogen fertilizer plant at Spiritwood, North Dakota.

Also within the Ag segment are results for Country Operations which, as you know, includes our local retail, animal nutrition and sunflower businesses. We saw earnings decline at the local retail operations level primarily due to lower margins. This was partially offset by higher 2016 grain volumes compared with fiscal 2015.

Lower margins also contributed to a decline in earnings for our wholesale Crop Nutrients business. Our Grain Marketing earnings also decreased in fiscal 2016, primarily due to lower margins which were partially offset by higher volumes.

7

Within CHS Processing and Food Ingredients, we saw lower year-over-year earnings for fiscal 2016. This was primarily due to costs associated with the impairment and sale of some assets, along with a specific customer receivable write-off and, to a lesser extent, lower crushing margins. Our Renewable Fuels marketing and production operations also declined in fiscal 2016 as a result of lower ethanol market prices. This was partially offset by increased volumes.

As I mentioned earlier, we made our long-term strategic investment in CF Nitrogen back on February 1st and are reporting this investment as our Nitrogen Production segment. Here we saw 2016 income before taxes, net of allocated expenses, of $34.1 million for seven months.

This year we’re reporting pre-tax earnings of $64.8 million, also net of allocated expenses, from our ownership interest in Ventura Foods under the Foods segment. Given the importance of Ventura Foods in our overall earnings for fiscal 2016, we are reporting it separately.

8

We’d previously included Ventura Foods results under the Corporate and Other heading.

Within Corporate and Other, I’m pleased to report slightly higher earnings for fiscal 2016 for our business services operations, including CHS Insurance, CHS Hedging and CHS Capital, along with lower year-over-year income from our portion of the Ardent Mills wheat milling joint venture.

So to recap, that’s the overview of fiscal 2016 — $424.2 million in net income on revenues of $30.3 billion.

Now let’s look at the most essential economic deliverable to our owners — cash returns on your business with CHS.

First, for fiscal 2016, based on fiscal 2015 earnings, CHS returned about $516 million to owners in the form of cash patronage, equity redemptions, preferred stock and dividends on preferred stock. Here’s a look at how that broke down.

9

And, based on fiscal 2016 results, we expect to return an estimated $337 million to our owners during fiscal 2017. This estimate includes cash patronage, equity redemptions to eligible member cooperatives and individuals, and dividends on preferred stock.

As you can see, out of the total estimated distribution, $167 million represents dividends on our five classes of preferred stock. I want to stress two things: First, dating back to our initial issuance nearly a dozen years ago, preferred stock has been a sound and effective equity management tool, enabling CHS to build its balance sheet and invest in the future for you without taking on excessive long-term debt and the associated restrictive financial covenants.

Preferred stock has enabled us to make significant investments in our refineries, in our domestic and export grain businesses, in value-added processing facilities, and in a long-term dependable supply of nitrogen fertilizer margins.

10

Second, while we don’t maintain the ownership records, and we realize shares are bought and sold each day, we do know that our member cooperatives and individual producers are among our preferred shareholders, and thus receive preferred dividends. To date, we’ve issued just over $500 million of CHS preferred stock to member cooperatives and individual producers through allocated equity redemption. That’s about one-quarter of the total $2.2 billion in outstanding shares. And, we also have been told that a number of our owners have purchased additional shares of CHS preferred stock on their own.

I also know from my years on this stage, that many of you are interested in knowing the 2016 patronage rates on our key products. These are still preliminary, but here’s a look at some of the key fiscal 2016 patronage rates:

And one final point on upcoming cash returns. Our objective is to distribute these during our typical late winter time frame. This past year, as you’ve heard, we started implementing CHS United — our new enterprise technology platform. And, as you know from putting in new

11

systems at your co-ops, installing a new home computer or even upgrading your smartphone, there’s always a learning curve. So far, we’ve successfully met each major CHS United milestone — including financial reporting and calculating member votes and patronage. This will be our first opportunity to process cash patronage distributions with the new tool. And the team has assured me that we will make this year’s patronage payments within a similar timeframe.

As I’ve said to groups of owners and employees, and financial partners over the past year, in a market environment like this our priority is to “control the controllables.” That’s what we’ve done during 2016 and will continue to do during fiscal 2017 and beyond.

This means sustaining our focus on financial and operational priorities. It means putting safety first. It means managing our expenses and staffing prudently. And, it means continuing to make the necessary investments and operational upgrades that are critical to serving our owners and customers.

12

As I mentioned earlier, our $2.8 billion investment in CF Nitrogen was transformational — an investment intended to benefit CHS owners today and for generations to come. When it came time to execute the deal, we made sure we had the essentials in place to take this important step in a challenging near-term environment — a strong balance sheet and ample liquidity to meet business needs.

And due to our unwavering focus on the essentials throughout fiscal 2016 — and tremendous support from our Board and employee team — I am pleased to report to you that the CHS balance sheet is solid and remains strong.

Our funded debt-to-equity ratio ended the year at 32 percent. That’s comparable to fiscal 2014, and is well within the limits set by our banks and our own more conservative financial guardrails. It also reflects our diligence in reducing funded debt even while making our CF Nitrogen investment.

For debt-to-cash flow, we again remain well below bank covenants, having reduced funded debt by $600 million versus the fiscal 2016

13

budget. As the year ended, the ratio was 2.37 times, bumping up against our conservative guardrail of 2.35 times. This provides CHS, your company, with appropriate financial flexibility as we navigate through this business cycle.

So what does the future look like?

No matter how much I try, I cannot predict the future and, as we’ve said many times, it’s impossible to know where the cycle will turn or when.  We can’t control how the cycle will play out. But, we can — and we will — stay steadfastly focused on the essentials that will keep our balance sheet strong. We will continue to control the controllables.

We will manage the CHS balance sheet to ensure strength and liquidity. As we ended fiscal 2016, we had more than $2 billion in undrawn committed credit.

After lowering our sales and administrative expenses by $50 million in 2016 versus the budget, we’re committed to keeping overhead flat through the next two years. Doing this will include identifying and

14

maximizing the value of our CHS United enterprise technology platform, adopting leading practices, and implementing shared services in a number of work streams across the company.

We will be disciplined in our capital expenditures, putting first things first — safety and maintaining our facilities.

We will continue to optimize our working capital investment by focusing on accounts receivable, inventories and accounts payable.

And, we will work to drive economic value creation of our businesses for our owners. CHS has made significant investments on your behalf over the past five years at an average annual rate of three-to-four times depreciation. That’s significant growth capital. Now we must make sure those investments and ALL CHS assets and operations deliver value for our member-owners.

During fiscal 2017, we’re adding Return on Assets — or ROA — as a key metric to measure financial performance, particularly at the business unit and asset level. This allows us to see how a business performs

15

over a period of years. And it allows us to measure performance consistently compared to CHS’s cost of capital.

So that’s my fiscal 2016 financial report. I hope that the underlying message is very clear. Your company’s financial foundation is solid and we are committed to keeping it that way as we navigate this challenging environment.

As I said at the beginning of this speech, even though I’m a numbers guy, I know this cooperatively owned business is really about people. Our owners. Our customers. Our employees and their families. People who continue to remind me what’s important.

Early one morning last month, a millennial member of our finance team provided me with such a reminder. This young man and I have had several development discussions over time. At one point, he asked me to recommend a book that had been impactful in my development. I had suggested one of my all-time favorites — Stephen Covey’s “The Seven Habits of Highly Effective People.”

16

In early November, he stopped by to say he’d bought it, was getting a lot out of it and asked if I would discuss it with him. His enthusiasm prompted me to pick up my own battered copy where I quickly saw the connection not only to our annual meeting theme, but also to our focus as a company, in three of those seven habits.

Habit Number One — be proactive. That is, to control the controllables.

Habit Number Two — begin with the end in mind. That’s easy. It’s why we’re here. It’s helping our owners grow and adding value for them, our employees and others who count on us, like the folks in Hallock, Minnesota.

Habit Number Three — put first things first. That’s what we’ve done during fiscal 2016. That’s our priority for fiscal 2017 and always.

We are committed to keeping your company strong and adding value for you today and for many tomorrows to come. So as I look forward, whether it’s written in the margin of a battered book, on the windows

17

of my office, a 3 by 5 notecard, or carried in my thoughts, I remain steadfastly focused on the essentials.

Every day.

Thank you and have a happy and safe holiday season.

18

Exhibit 99.4

Exhibit 99.5

Good morning.

Rich soil.

Adequate moisture.

The right inputs applied at the right time.

Sound advice from trusted advisors.

As farmers, we know these are the essentials, not only for raising a bountiful crop, but also to create a livelihood for our families. And, even as we’re always exploring the possibilities offered by research, technology and evolving markets, we know success begins with the basics.

The same holds true for cooperative leadership. Beneath the late meetings, lengthy agendas and dozens of discussions lies our essential responsibility as directors: The duty of care and loyalty.

1

Simply put, duty of care and loyalty means always putting the best interests of the entire company and all of its owners at the forefront of our oversight and decision making.

This is our charge as CHS directors. I hope those of you who are directors at your own cooperatives commit to this charge. As leaders, we’re elected by our owners and entrusted by them as the governing stewards of the company they own. That means we must be unwavering in our commitment, whether we’re guiding our co-ops through robust growth or, as we are today, navigating a period of challenging economics and markets.

In my time with you, I want to share how your CHS Board’s commitment to this essential principle played out in three core areas during fiscal 2016: The financial oversight of your company, CHS governance and taking a long-term view on behalf of our owners.

2

Early last month, we formally reported financial results for fiscal 2016. In a few minutes CFO Tim Skidmore will review details. I expect most of you are not only aware of these results but, given the economic environment, you were not surprised by them. Lower revenues, lower earnings and lower margins are a common refrain within our business sectors from the farm gate to the global marketplace.

For the record, CHS reported net income of $424.2 million for fiscal 2016, down from $781 million a year ago. Our revenues were $30.3 billion, also down from a year ago.

These numbers are important, but they capture just a single moment in time — August 31, 2016. Your board’s financial oversight of the CHS balance sheet is a year-around, long-term assignment. Whether the operating environment is robust or more challenging, this is an ongoing conversation and responsibility. It shapes the decisions we make that directly affect our owners, equity management policy, cash returns and investments in your future.

3

With that as our decision-making litmus test, CHS cash returns to owners for fiscal 2016 — which will take place during fiscal 2017 — are expected to be about $337 million. This will include cash patronage, equity redemptions and dividends on preferred stock. We continue to return 40 percent of patronage earnings to eligible owners in cash. And, while at lower levels than in recent years, we’re also continuing to redeem equity. In the last decade, we’ve made tremendous strides in equity redemption. Member cooperatives are now current through a portion of 2006.

In addition, in line with our commitment to maintaining a sound balance sheet, as fiscal 2016 ended, the CHS Board revisited its earlier decision to change the company’s individual member equity redemption policy.

Back in March we shared that effective with business done with CHS in fiscal 2016, we would move eligible individuals to the same equity redemption program now in place for member cooperatives. This

4

would mean that, in addition to receiving cash patronage, individuals would receive equity redemptions at the same rate as member co-ops. Currently, individual members receive cash patronage, but all retained equity is redeemed upon request at age 70. We also fully redeem equity to estates upon request for this group of members.

The goal of this policy change is to provide more immediate economic value to all members through timely equity redemptions, particularly for our newer and younger cooperative member-owners. In addition, the change helps simplify our current approach by putting member co-ops and individuals on the same program.

Given our commitment to balance sheet management, which requires effectively managing cash, in August the board decided to delay the effective date of the new policy. Our intent is to make this effective for business done in fiscal 2017, but we’ll continue to evaluate that timetable against the economic environment and communicate any decision to you.

5

I do want to note that the CHS Board’s charge of “duty of care and loyalty” extends beyond financial matters. During 2016, our board newsletter offered a look at other oversight roles CHS Board committees play. We’re involved in vital areas like risk management and making sure our owners’ collective voice is heard on issues impacting this company and its businesses.

If you serve on a corporate board and want your members to approve changes to your core governing documents, what are three things you must do?

Speaking on behalf of all of your CHS board members, I can say over the last 18 months we learned that the answer is:

·                  First, we need listen to you

·                  Second, we need to keep it simple

·                  And third, we must make sure there’s plenty of time for learning and conversation

6

A year ago at this time the CHS Board asked delegates to consider amendments to the company’s Articles and Bylaws. After lots of lively conversation, your decision at the 2015 annual meeting told us we had more work to do in each of the three areas I just mentioned.   So, we went back to work.  We started by asking our owners for their thoughts on the issues to be addressed.

On behalf of the board, thank you to everyone who participated in this conversation. Whether you responded to the informational survey, attended a meeting, invited a CHS director to your board room or called one of us, we value your input. Having a voice in the governance of the company you own and do business with is an essential point of difference of the cooperative business model.

As a board, we took this process very seriously. After lots of listening, we returned to you in June with a proposal that focuses strictly on membership eligibility. We introduced it via a video which, to date, has had almost 1,000 views! We created informational materials, developed a robust website and held listening sessions at

7

all 10 Your CHS Town Hall meetings. Just two weeks ago, we connected with you through a live webcast.

Given the extent of communication — which wrapped up with a special breakout session yesterday and a review this morning in regional caucuses — I will only touch on the high points. When we consider a vote on the proposed resolutions an hour or so from now, you’ll have a final opportunity to ask any remaining questions.

But what I do want to stress is that our goal is making sure CHS remains an agricultural-focused and producer-governed cooperative. At the same time, we recognize we must accommodate our current members as they change to stay relevant to their customers.

Our articles and bylaws need to line up with the ways our members do business today, while recognizing the strong heritage of the member cooperatives who built today’s CHS.

8

We felt the best way to fulfill these objectives was a balanced solution that creates new membership classes. This is what you’ll be voting on today. If approved, CHS will have four membership classes:

Class A membership for two groups — eligible individual agricultural producers and associations of agricultural producers.

The cooperative associations in Class A must have 100 percent agricultural producers as voting members and as voting members of their boards. Class A members would have voting rights and be eligible to receive patronage.

Class B members. These would be organizations operating on a cooperative basis that don’t meet Class A criteria. Typically this would be because they have either non-producers as voting members or non-producers as voting directors. Class B members would be eligible to receive CHS patronage, but would NOT have CHS voting rights.

9

Class C Membership would be for all the cooperative associations who are CHS members as of this CHS 2016 Annual Meeting.

We will keep the Defined Members class in our bylaws for now. Although we discontinued that program years ago, as was mentioned, we wanted the proposed amendments to stay focused on the new member classes for now.  We can consider deleting the defined member class and other obsolete language in the future.

As I said, you’ll have time for questions when we consider the two resolutions delegates will vote on. Your board is strongly recommending a “yes” vote on both of these resolutions.

Moving forward, we all need to remember that the CHS Articles and Bylaws are living documents. We know the world in which we operate today will be different five, 10 or more years from now. Our member cooperative- and producer-owners will evolve. And, as the future

10

unfolds, we’ll need to ensure that these essential governance documents continue to align with our owners’ reality while respecting our heritage.

Throughout 2016, the CHS Board’s learning and listening extended well beyond governance issues. We gained insights from industry experts who visited the board room. We participated in Your CHS Town Hall meetings, with several directors travelling to different geographies to hear what was on the minds of owners outside our home regions.

In early June, we boarded a bus and visited CHS owners in Kansas. While there we also got first-hand looks at our McPherson refinery, our Hutchinson soy processing facility and our Canton grain shuttle joint venture. These in-person opportunities lend valuable real-world perspective to future board room conversations and decision making beyond spreadsheets and presentations.

11

A couple of our directors even did some educating of their own, hosting employees from our headquarters office for real on-the-farm experiences, a first for many of these CHS staff members.

At this time, I’d ask the 17 CHS directors, as well as their spouses, to stand so we can thank them for the considerable time and unwavering commitment they give to serving this company on your behalf.

I was never a Boy Scout, but I think their motto “Be Prepared” is certainly fitting as we navigate the current economic environment and a constantly changing world. Being prepared is essential to leadership.

From the CHS Board’s perspective, as I’ve said a number of times today, being prepared starts with a sound balance sheet. With that as our foundation, we must make the right decisions for the short-term, while always taking the long-term view.

12

Being prepared means understanding what our owners will need from their cooperative today and tomorrow and making choices that add value.

Our CF Nitrogen investment of almost a year ago certainly does that. We’ve made sure that not only do today’s owners have the dependable supplies of patronage-eligible nitrogen fertilizer they need, but tomorrow’s owners will, too.

Being prepared means not only identifying those next generations of owners, but having products and services, along with governance and equity management, that make doing business with a cooperative attractive. These are smart, tech-savvy individuals. There are more demands on them — especially in this down ag economy — and they are certain to put more demands on us to create measurable new value.

13

Being prepared also means connecting with those next generations and giving them robust tools to grow as cooperative and rural leaders.

Your board takes that preparation seriously, as evidenced by the 111 participants in this year’s New Leader Forum who’ve spent much of this week with us growing their leadership skills, exploring ag industry challenges and learning about cooperatives. We’ve expanded our outreach beyond this week by including new leaders in our Your CHS Experience conference, inviting them to Capitol Hill for legislative visits, and encouraging their participation in Your CHS Town Hall update meetings with board and management. It’s gratifying to know that our New Leaders are ready to step up to the challenge of leading. Of this year’s group, 45 percent said they’re interested in cooperative board service and 8 percent are already directors!

Finally, and I believe this is imperative for every cooperative represented here, being prepared means seeking new perspectives.

14

You can attend workshops. You can bring in guest speakers. But nothing compares to having someone with a diverse background and outlook serving on your board — of a different gender, ethnicity, generation or farming operation. New perspective brings tremendous value, especially when tougher economics call for innovative thinking. In addition, especially for an organization the size of CHS, there’s a growing expectation that boards reflect diversity.

I challenge you to return to your boardrooms, talk about this issue and devise a plan for bringing diversity to your board. I assure you the same conversation is underway in the CHS boardroom.

I’ve been farming for several decades. I’ve served as a cooperative director for much of my farming career. I know that’s also true for many of you.

I still learn lessons every day, some of them hard ones, some of them more than once.

15

In closing, I’ll share two essential lessons I’ve learned. First, when times are good, it’s easy to make decisions and it’s easy to keep on doing what you’ve been doing without much thought as to whether there’s a better way. If corn’s $7, it’s easy to decide to plant more. When there’s a high demand for what you raise, it’s easy to stick with your tried and true production and marketing strategies. When corn drops to $3.50 or your market dries up, there’s tremendous incentive to do things differently and make changes you could have made earlier.

So when we face down cycles like this one, I see a silver lining, one that calls us to be open to possibilities we’ve overlooked or dismissed. It’s a call to have the courage to focus on what’s most important and to be open to opportunity.

My second lesson has been that in agriculture we can’t go it alone. Fortunately, we don’t have to go it alone. We can count on our families, our employees, our neighbors. And, we can count on our cooperatives and those trusted teams to be there when we need them,

16

to offer new solutions and to do it all while giving us a return on our business and a voice in governance.

Good soil. Moisture. The right inputs at the right time. Trusted advisors. An economic return. A voice in a business you own. A healthy, vibrant cooperative system. To me, these are the essentials. I hope you agree.

Thank you.

17

Exhibit 99.6