ST. PAUL, MINN. — Net income at CHS Inc. in the year ended Aug. 31 rose 32% to $502,159,000, up from $381,407,000 in fiscal 2009. Revenues for the year, meanwhile, fell to $25,267,931,000 from $25,729,916,000 in fiscal 2009. Decreased sales were attributed to lower volatility in values for the grains and crop nutrient commodities that make up the majority of CHS sales.

The company’s Ag Business segment, which consists of CHS’s agronomy, grain marketing and retail operations, posted operating earnings of $243,338,000 up sharply from $100,176,000 in fiscal 2009. Sales in the segment totaled $15,678,160,000, down 9% from $17,196,448,000.

“The price fluctuations for fiscal 2010 were far less volatile and we carried lower unhedged positions as well, which has the effect of reducing both the potential for large earnings or large losses,” CHS said in a Nov. 12 filing with the Securities and Exchange Commission. “During fiscal 2010, we recorded a gain related to the sales of many of the southern retail facilities of Agriliance of $28.4 million. In addition, Agriliance saw improved margins during fiscal 2010, partially offset by reduced earnings from a Canadian equity investment that was sold during the second quarter of fiscal 2009. Combined agronomy equity investments resulted in a $39.9 million net increase in earnings, net of allocated internal expenses. We anticipate the repositioning of the majority of the remaining Agriliance retail operations to occur during fiscal 2011.

“Our grain marketing earnings decreased by $5.9 million during fiscal 2010 when compared to fiscal 2009, primarily the result of slightly higher expenses and net reduced earnings from joint ventures, partially offset by higher grain margins and volumes. Our country operations earnings increased $37.5 million, primarily as a result of improved crop nutrients and grain margins.”

Earnings within CHS Processing operations, which include its oilseed processing, wheat milling, food production and renewable fuels operations, eased slightly during the year. Operating earnings in fiscal 2010 were $17,159,000, down from $17,735,000 in fiscal 2009. Sales fell 7% to $1,061,654,000 from $1,142,636,000.

CHS said oilseed processing earnings increased $900,000 during fiscal 2010 compared with fiscal 2009, primarily due to improved margins and volumes in the company’s crushing operations, partially offset by reduced margins in its refining operations.

“Our share of earnings from our wheat milling joint ventures, net of allocated internal expenses, increased $7.1 million in fiscal 2010 compared to fiscal 2009, primarily the result of improved margins on the products sold,” CHS said. “Our share of earnings from Ventura Foods, our packaged foods joint venture, net of allocated internal expenses, reflected a decrease of $21.7 million during fiscal 2010 compared to fiscal 2009, primarily the result of increased commodity prices for inputs, reducing margins on the products sold."