CASSELTON, N.D. — Keith Finney bought his last corn for Tharaldson Ethanol on his 67th birthday, March 28, 2020.
Thus ended 47 years of grain buying. The length of his career, plus his unique experience in large-volume corn makes it likely he’s traded more grain bushels than anyone in the region’s history. “Certainly hundreds of millions of bushels,” Finney says.
“He’s probably got as much as experience as anybody in the business, as far as trading grain,” says Stu Letcher, executive director of the North Dakota Grain Dealers Association.
Keith’s heritage and career read like a history book of grain marketing milestones. It spans a remarkable range — shoveling coal at a small co-op, filling boxcars, private grain elevators, the region’s first greenfield shuttle loader, the first western North Dakota ethanol plant, and finally,buying corn for the sixth-largest ethanol plant in the country.
His family history in the region goes back to the 1870s, Finney’s great-grandfathers were the first and second white homesteaders in St. Vincent Township of northwest Minnesota's Kittson County — Alexander Turner immigrated from Scotland and John Finney immigrated from Ireland.
Born in 1953, Keith graduated from Humboldt (Minn.) High School in 1971. His father, Edward “Ward” Finney, died of a heart attack when Keith was 16. In July 1972, Keith married his high school sweetheart, Joni Deere (daughter of John Deere, a farmer from nearby Hallock, Minn.)
Keith started in law enforcement studies at Bemidji State University, but got a draft number for the Vietnam War. But the draft ended just before he was to ship out.
Richard “Punky” Maeir, manager of the Humboldt Elevator Association (now Humboldt-St. Vincent Elevator) asked him to come work at the elevator. Suddenly, Finney was a grain buyer, and became familiar with international grain business, particularly with idiosyncrasies of the politics and particulars of Canadian grain.
In July 1972, the U.S. government subsidized sales of grain to the Russians, not knowing about the extent of that country’s drought. Grain prices soared 30% to 50% for a 10-month period in 1973. Wheat prices rose to up to $5 a bushel. “It put a lot of money in farmers’ pockets,” Keith says.
The co-op was loading grain into “box cars” — sometimes boarded up old cattle cars. The elevator had 300,000 bushels of storage. “Because of the ‘Russian Grain Robbery,’ all of this grain was coming out of storage.” Farmers invested in bigger equipment. Keith remembered seeing his first tandem truck in about 1974.
Keith and Joni had two sons — Erik in 1974 and Edward “John” in 1976. When Joni’s brother died unexpectedly, the couple went to work on John Deere’s farm.
Saved by PIK
In 1978, a Benson-Quinn official asked Keith to manage a brand new cooperative-owned elevator company, with locations at Lancaster, Minn., and a brand new facility Lake Bronson, Minn.
In 1980, President Jimmy Carter put an embargo on selling grain to Russia. Grain prices plunged, sending farmers into the farm credit crisis. Keith’s new co-op had borrowed a lot of money just as loan interest rates rocketed to 23% per year. The co-op sold its facilities in 1983.
He managed the Northcote (Minn.) Farmers Elevator. Farmers took out government loans on grain. When market price stayed lower than the loan and they forfeited grain to the federal Commodity Credit Corp, which paid 26.5 cents a bushel per year for storage. Keith remembers traveling to Indiana and North Carolina, trading certificates (“certs”) in the government’s Payment-in-Kind program.
To SD, and back
In 1991, Sexauer Company of Brookings, S.D., hired him to open a Gary, S.D., elevator, and manage another at nearby Clear Lake, S.D. Keith pursued a commodities brokerage license and was one of the early managers to manage risk by making offsetting cash and futures transactions, as well as options, reintroduced to give farmers or elevators a right to pay a fee to get down-side or up-side risk.
In 1994, Danny Pinske, the general manager of the MAYPORT Farmers Co-op Elevator at Portland, N.D., called him. Come up and run the MAYPORT grain division, Pinske said.
“I taught marketing in night classes,” Keith says. “I started a couple of marketing clubs with MAYPORT farmers. I would tell people not to get into some contracts if they didn’t understand it.”
In 1998, Keith married Sandra Hodge, who had two daughters. In 1998, Jim Leclair, a Mayville, N.D., insurance man, and former professional football player approached Keith to form Evergreen Marketing Management Ltd., a business to market grain for farmers.
On June 5, 2000, Keith suffered a heart attack. While recovering, the general manager of the new Alton Grain Terminal south of Hillsboro, N.D., owned by a consortium of area cooperative elevators, recruited him to serve as head merchandiser. In 2001, the Alton Terminal, was “the Cadillac of shuttles,” Finney says. It was the first of its kind in the region — a greenfield project, initially with 1 million bushels of concrete storage (later 2 million, and finally 4 million bushels).
It had a mile-long straight siding track. Finney bought grain from 52 participating elevators and farmers, delivering with semis in an era of fast-expanding corn and soybean acres.
The BNSF invested in “passing tracks,” making shipping longer trains more feasible. They offered favorable shipping rates to the Pacific Northwest as export markets to Asia opened up.
Ethanol’s wild west
In 2006, officials of Red Trail Energy, the state’s first coal-fired ethanol corn ethanol plant at Richardton, N.D., hired Finney to start the company’s corn acquisition program in a region not yet known for corn production.
Red Trail initially shipped in shuttle trains of corn from eastern North Dakota and western Minnesota. Eventually, Red Trail and its distillers grain cattle feed became a fixture in southwest North Dakota.
Finally, in November 2007, officials at Tharaldson Ethanol LLC of Casselton, N.D., approached Keith to establish a corn acquisition program. Keith in turn approached Clifford Farmers Co-op Elevator Co., one of the owners of Alton Terminal, as the buying agent. Keith, and associate Brad Kjar (who had worked with him at Alton) office at the ethanol plant, but officially worked for the co-op, based 50 miles away.
At first, Tharaldson expected to buy all of the grain, but later decided it was better if Clifford Co-op would buy it and sell it to the ethanol plant, as needed. Keith says there is a difference between buying grain for an elevator versus buying grain for an ethanol plant. “It’s a whole different way of thinking,” Keith said. “Grain elevators want corn. We NEEDED it in order to make ethanol.”
“One of the benefits of having the co-op buy grain direct from farmers was that the farmers were paid dividends by the co-op,” which gives the producer a better net price.
Clifford had an amount of storage among its locations.The plant has access to corn from the Red River Valley and Western shortline railroad, which goes to Kindred and Wahpeton, in North Dakota, and Breckenridge, Minn.
Finney made a science of understanding the competitor’s costs — ocean and rail costs. He had to adjust his bid to make sure it was stronger than the bids that would take it to the Pacific Northwest and other export markets. “Yet, I wanted not to put them out of business,” he said. “I tried to give them a (profit) margin if they could buy grain and sell it to me.”
Tharaldson started buying corn in summer 2008 and started producing ethanol on Dec. 31, 2008. After initial problems with the grain dryer, the company continued without a hiccup. Today, it is the sixth-largest in the United States.
Looking ahead, Keith is concerned that the COVID-19 impact on farmers and ethanol industry may be 12 to 18 months, creating large supplies of corn. He remembers how the government had to step in with farmland set-aside programs in the 1980s, and wonders if that’ll happen again. Much will depend on the mood of China markets and South American competitors.
In retirement, Finney says he’ll continue to run a branch office for John Stewart and Associates, with commodities trading licenses. “The last 47 years have crept on me. Here, I still want to be involved in agriculture. My biggest takeaway from the whole thing is the people — producers, co-workers, export buyers.”
At Portland, N.D., Finney is building an “office/man cave,” serving some producers and elevators who will hedge through his account He’ll enjoy not having to drive “49.8 miles to work every morning,” he jokes. And he’ll be free to analyze markets “without focusing on buying corn.”