Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 14, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | LAKE AREA CORN PROCESSORS LLC | |
Entity Central Index Key | 0001156174 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Amendment Flag | false | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 29,620,000 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 5,482,879 | $ 1,697,937 |
Accounts receivable | 4,149,707 | 1,202,196 |
Other receivables | 36,036 | 26,857 |
Inventory | 8,737,562 | 7,561,501 |
Derivative financial instruments | 473,763 | 554,005 |
Prepaid expenses | 104,252 | 265,793 |
Total current assets | 18,984,199 | 11,308,289 |
PROPERTY AND EQUIPMENT | ||
Land | 874,473 | 874,473 |
Land improvements | 8,558,720 | 8,558,720 |
Buildings | 9,316,576 | 9,001,546 |
Equipment | 95,281,802 | 61,839,725 |
Construction in progress | 235,212 | 26,203,702 |
Gross Property and Equipment | 114,266,783 | 106,478,166 |
Less accumulated depreciation | (46,245,218) | (42,729,898) |
Net property and equipment | 68,021,565 | 63,748,268 |
OTHER ASSETS | ||
Goodwill | 10,395,766 | 10,395,766 |
Investments | 17,317,302 | 17,300,470 |
Other | 101,285 | 113,279 |
Total other assets | 27,814,353 | 27,809,515 |
TOTAL ASSETS | 114,820,117 | 102,866,072 |
CURRENT LIABILITIES | ||
Outstanding checks in excess of bank balance | 3,121,137 | 2,247,215 |
Accounts payable | 5,755,499 | 6,849,896 |
Accrued liabilities | 850,772 | 765,994 |
Derivative financial instruments | 61,734 | 368,475 |
Current maturities of notes payable | 1,000,000 | 1,000,000 |
Other | 4,000 | 4,000 |
Total current liabilities | 10,793,142 | 11,235,580 |
LONG-TERM LIABILITIES | ||
Notes payable | 37,988,333 | 23,585,368 |
Other | 4,000 | 8,000 |
Total long-term liabilities | 37,992,333 | 23,593,368 |
MEMBERS' EQUITY (29,620,000 units issued and outstanding) | 66,034,642 | 68,037,124 |
TOTAL LIABILITIES AND MEMBERS' EQUITY | $ 114,820,117 | $ 102,866,072 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Members' equity outstanding (units) | 29,620,000 | 29,620,000 |
Members' equity issued (units) | 29,620,000 | 29,620,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
REVENUES | $ 32,441,510 | $ 18,796,356 | $ 80,151,796 | $ 58,677,962 |
COSTS OF REVENUES | 34,256,712 | 18,078,236 | 78,218,717 | 53,282,450 |
GROSS PROFIT | (1,815,202) | 718,120 | 1,933,079 | 5,395,512 |
OPERATING EXPENSES | 971,662 | 872,053 | 2,906,424 | 2,847,557 |
INCOME (LOSS) FROM OPERATIONS | (2,786,864) | (153,933) | (973,345) | 2,547,955 |
OTHER INCOME (EXPENSE) | ||||
Interest and other income | 12,320 | 2,228 | 163,385 | 53,533 |
Equity in net income (loss) of investments | (349,123) | (30,513) | (425,776) | 559,970 |
Interest expense | (476,122) | 0 | (766,746) | 0 |
Total other income (expense) | (812,925) | (28,285) | (1,029,137) | 613,503 |
NET INCOME (LOSS) | $ (3,599,789) | $ (182,218) | $ (2,002,482) | $ 3,161,458 |
BASIC AND DILUTED EARNINGS (LOSS) PER UNIT (in dollars per unit) | $ (0.12) | $ (0.01) | $ (0.07) | $ 0.11 |
WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING FOR THE CALCULATION OF BASIC & DILUTED EARNINGS (LOSS) PER UNIT (units) | 29,620,000 | 29,620,000 | 29,620,000 | 29,620,000 |
DISTRIBUTIONS DECLARED PER UNIT (in dollars per unit) | $ 0 | $ 0 | $ 0 | $ 0.10 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Members' Equity (Unaudited) | USD ($) |
Balance at the beginning of period at Dec. 31, 2017 | $ 68,282,537 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Net Income | 1,876,697 |
Member distributions | (2,962,000) |
Balance at the end of period at Mar. 31, 2018 | 67,197,234 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Net Income | 1,466,978 |
Balance at the end of period at Jun. 30, 2018 | 68,664,212 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Net Income | (182,218) |
Balance at the end of period at Sep. 30, 2018 | 68,481,994 |
Balance at the beginning of period at Dec. 31, 2018 | 68,037,124 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Net Income | 1,790,204 |
Balance at the end of period at Mar. 31, 2019 | 69,827,328 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Net Income | (192,897) |
Balance at the end of period at Jun. 30, 2019 | 69,634,431 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |
Net Income | (3,599,789) |
Balance at the end of period at Sep. 30, 2019 | $ 66,034,642 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Members' Equity (Unaudited) (Parenthetical) | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Distributions paid per capital unit (in dollars per unit) | $ 0.10 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
OPERATING ACTIVITIES | ||
Net income | $ (2,002,482) | $ 3,161,458 |
Adjustments to reconcile net income to cash provided by operating activities | ||
Depreciation and amortization | 3,529,356 | 2,323,713 |
Distributions in excess of earnings from investments | 617,091 | 1,602,045 |
(Increase) decrease in | ||
Accounts receivable | (2,956,690) | 1,049,207 |
Inventory | (1,176,060) | (1,315,699) |
Prepaid expenses | 161,541 | 115,922 |
Derivative financial instruments | (226,499) | 349,138 |
Accounts payable | (14,951) | (2,637,722) |
Accrued and other liabilities | 80,778 | (59,195) |
NET CASH PROVIDED BY OPERATING ACTIVITIES | (1,987,916) | 4,588,867 |
INVESTING ACTIVITIES | ||
Purchase of property and equipment | (8,868,064) | (15,171,559) |
Purchase of investments | (633,924) | (301,024) |
NET CASH (USED IN) INVESTING ACTIVITIES | (9,501,988) | (15,472,583) |
FINANCING ACTIVITIES | ||
Increase (decrease) in outstanding checks in excess of bank balance | 873,922 | (179,594) |
Borrowings on notes payable | 47,500,000 | 16,673,268 |
Principal payments on notes payable | (33,099,076) | (4,574,268) |
Financing costs paid | 0 | (95,500) |
Distributions paid to members | 0 | (2,962,000) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 15,274,846 | 8,861,906 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 3,784,942 | (2,021,810) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 5,482,879 | 3,081,149 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 1,697,937 | 5,102,959 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Cash paid during the period for interest, net of capitalized interest of $830,432 and $358,769 in 2019 and 2018, respectively. | 356,215 | 0 |
Capital expenditures in accounts payable | $ 81,387 | $ 2,909,331 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Cash Flows [Abstract] | ||
Capitalized interest | $ 830,432 | $ 358,769 |
Nature of Operations
Nature of Operations | 9 Months Ended |
Sep. 30, 2019 | |
Nature of Operations [Abstract] | |
Nature of Operations | NATURE OF OPERATIONS Principal Business Activity Lake Area Corn Processors, LLC and subsidiary (the "Company") is a South Dakota limited liability company. The Company owns and manages Dakota Ethanol, LLC ("Dakota Ethanol"), a 90 million -gallon (annual nameplate capacity) ethanol plant, located near Wentworth, South Dakota. Dakota Ethanol sells ethanol and related products to customers located in North America. In addition, the Company has investment interests in five companies in related industries. See note 4 for further details. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The unaudited financial statements contained herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America although the Company believes that the disclosures are adequate to make the information not misleading. In the opinion of management, all adjustments considered necessary for a fair presentation have been included in the accompanying financial statements. All adjustments are of a normal and recurring nature. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for a full year. These financial statements should be read in conjunction with the financial statements and notes included in the Company’s audited financial statements for the year ended December 31, 2018 , contained in the annual report on Form 10-K for 2018. Principles of Consolidation The consolidated financial statements of the Company include the accounts of its wholly owned subsidiary, Dakota Ethanol. All significant inter-company transactions and balances have been eliminated in consolidation. Revenue Recognition The Company has adopted the guidance of ASC Topic 606, Revenue from Contracts with Customers (Topic 606). Topic 606 requires the Company to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance requires the Company to apply the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the Company satisfies a performance obligation. The Company generally recognizes revenue at a point in time. The majority of the Company’s contracts with customers have one performance obligation and a contract duration of one year or less. The following is a description of principal activities from which we generate revenue. Revenues from contracts with customers are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. Generally, ethanol and related products are shipped FOB shipping point and the control of the goods transfers to customers when the goods are loaded into trucks or rail cars are released to the railroad. Consideration is based on predetermined contractual prices or on current market prices. • sales of ethanol • sales of distillers grains • sales of distillers corn oil Disaggregation of revenue: All revenue recognized in the income statement is considered to be revenue from contracts with customers. The following table depicts the disaggregation of revenue according to product line: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues ethanol $ 25,563,757 $ 14,599,385 $ 62,573,333 $ 45,970,750 Revenues distillers grains 5,634,315 3,630,835 14,539,232 11,056,256 Revenues distillers corn oil 1,243,438 566,136 3,039,231 1,650,956 $ 32,441,510 $ 18,796,356 $ 80,151,796 $ 58,677,962 Contract assets and contract liabilities: The Company has no significant contract assets or contract liabilities from contracts with customers. The Company receives payments from customers based upon contractual billing schedules; accounts receivable are recorded when the right to consideration becomes unconditional. Contract liabilities include payments received in advance of performance under the contract, and are realized with the associated revenue recognized under the contract. Shipping costs Shipping costs incurred by the Company in the sale of ethanol, dried distiller's grains and corn oil are not specifically identifiable and as a result, revenue from the sale of those products is recorded based on the net selling price reported to the Company from the marketer. When the Company performs shipping and handling activities after the transfer of control to the customers (e.g., when control transfers prior to delivery), they are considered fulfillment activities, and accordingly, the costs are accrued for when the related revenue is recognized. Operating Segment The Company uses the "management approach" for reporting information about segments in annual and interim financial statements. The management approach is based on the way the chief operating decision-maker organizes segments within a company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure and any other manner in which management disaggregates a company. Based on the "management approach" model, the Company has determined that its business is comprised of a single operating segment. Costs of Revenues The primary components of costs of revenues from the production of ethanol and related co-product are corn, energy (natural gas and electricity), raw materials (chemicals and denaturant), and direct labor costs. Shipping costs on modified and wet distiller's grains are included in costs of revenues. Inventory Valuation Inventories are generally valued using methods which approximate the lower of cost (first-in, first-out) or net realizable value. In the valuation of inventories and purchase commitments, net realizable value is based on estimated selling prices in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. Receivables and Credit Policies Accounts receivable are uncollateralized customer obligations due under normal trade terms requiring payment within fifteen days from the invoice date. Unpaid accounts receivable with invoice dates over thirty days old bear interest at 1.5% per month. Accounts receivable are stated at the amount billed to the customer. Payments of accounts receivable are allocated to the specific invoices identified on the customer’s remittance advice or, if unspecified, are applied to the earliest unpaid invoices. The carrying amount of trade receivables is reduced by a valuation allowance that reflects management’s best estimate of the amounts that will not be collected. Management regularly reviews trade receivable balances and based on an assessment of current creditworthiness, estimates the portion, if any, of the balance that will not be collected. The valuation allowance was $2,131 as of September 30, 2019 and December 31, 2018 . Investment in commodities contracts, derivative instruments and hedging activities The Company is exposed to certain risks related to its ongoing business operations. The primary risks that the Company manages by using forward or derivative instruments are price risks on anticipated purchases of corn and natural gas and the sale of ethanol, distillers grains and distillers corn oil. The Company is subject to market risk with respect to the price and availability of corn, the principal raw material the Company uses to produce ethanol and ethanol by-products. In general, rising corn prices result in lower profit margins and, therefore, represent unfavorable market conditions. This is especially true when market conditions do not allow us to pass along increased corn costs to its customers. The availability and price of corn is subject to wide fluctuations due to unpredictable factors such as weather conditions, farmer planting decisions, governmental policies with respect to agriculture and international trade and global demand and supply. Certain contracts that literally meet the definition of a derivative may be exempted from derivative accounting as normal purchases or normal sales. Normal purchases and normal sales are contracts that provide for the purchase or sale of something other than a financial instrument or derivative instrument that will be delivered in quantities expected to be used or sold over a reasonable period in the normal course of business. Contracts that meet the requirements of normal purchases or sales are documented as normal and exempted from the accounting and reporting requirements of derivative accounting. The Company does not apply the normal purchase and sales exemption for forward corn purchase contracts. As of September 30, 2019 , the Company is committed to purchasing approximately 1.7 million bushels of corn on a forward contract basis with an average price of $3.74 per bushel. The total corn purchase contracts represent 6% of the annual projected plant corn usage. The Company enters into firm-price purchase commitments with natural gas suppliers under which the Company agrees to buy natural gas at a price set in advance of the actual delivery. Under these arrangements, the Company assumes the risk of a price decrease in the market price of natural gas between the time the price is fixed and the time the natural gas is delivered. At September 30, 2019 , the Company is committed to purchasing approximately 652,000 MMBtu’s of natural gas with an average price of $2.64 per MMBtu. The Company accounts for these transactions as normal purchases, and accordingly, does not mark these transactions to market. The natural gas purchase contracts represent 32% of the annual plant requirements. The Company enters into firm-price sales commitments with distillers grains customers under which the Company agrees to sell distillers grains at a price set in advance of the actual delivery. Under these arrangements, the Company assumes the risk of a price increase in the market price of distillers grain between the time the price is fixed and the time the distillers grains are delivered. At September 30, 2019 , the Company is committed to selling approximately 32,000 dry equivalent tons of distillers grains with an average price of $127 per ton. The Company accounts for these transactions as normal sales, and accordingly, does not mark these transactions to market. The distillers grains sales represent approximately 15% of the projected annual plant production. The Company enters into firm-price sales commitments with distillers corn oil customers under which the Company agrees to sell distillers corn oil at a price set in advance of the actual delivery. Under these arrangements, the Company assumes the risk of a price increase in the market price of distillers corn oil between the time the price is fixed and the time the distillers corn oil is delivered. At September 30, 2019 , the Company is committed to selling approximately 2.0 million pounds of distillers corn oil with an average price of $0.23 per pound. The Company accounts for these transactions as normal sales, and accordingly, does not mark these transactions to market. The distillers corn oil sales represent approximately 9% of the projected annual plant production. The Company does not have any firm-priced sales commitments for ethanol as of September 30, 2019 . The Company enters into short-term forward, option and futures contracts for ethanol, corn and natural gas as a means of managing exposure to changes in commodity and energy prices. All of the Company's derivatives are designated as non-hedge derivatives, and accordingly are recorded at fair value with changes in fair value recognized in net income. Although the contracts are considered economic hedges of specified risks, they are not designated as and accounted for as hedging instruments. As part of our trading activity, the Company uses futures and option contracts offered through regulated commodity exchanges to reduce risk of loss in the market value of inventories and purchase commitments. To reduce that risk, the Company generally takes positions using forward and futures contracts and options. Derivatives not designated as hedging instruments at September 30, 2019 and December 31, 2018 were as follows: Balance Sheet Classification September 30, 2019 December 31, 2018* Forward contracts in gain position $ 234,377 $ 676 Futures contracts in gain position 20,363 175,038 Futures contracts in loss position (52,738 ) — Total 202,002 175,714 Cash held by broker 271,761 378,291 Current Assets $ 473,763 $ 554,005 Forward contracts in loss position (Current Liabilities) $ (61,734 ) $ (368,475 ) *Derived from audited financial statements Futures contracts and cash held by broker are all with one party and the right of offset exists. Therefore, on the balance sheet, these items are netted in one balance regardless of position. Forward contracts are with multiple parties and the right of offset does not exist. Therefore, these contracts are reported at the gross amounts on the balance sheet. Realized and unrealized gains and losses related to derivative contracts related to corn and natural gas purchases are included as a component of costs of revenues and derivative contracts related to ethanol sales are included as a component of revenues in the accompanying financial statements. Statement of Operations Three Months Ended September 30, Classification 2019 2018 Net realized and unrealized gains (losses) related to purchase contracts: Futures contracts Cost of Revenues $ (788,253 ) $ 762,395 Forward contracts Cost of Revenues (424,895 ) (844,490 ) Statement of Operations Nine Months Ended September 30, Classification 2019 2018 Net realized and unrealized gains (losses) related to purchase contracts: Futures contracts Cost of Revenues $ (113,672 ) $ 1,755,445 Forward contracts Cost of Revenues 53,655 (1,498,835 ) Investments The Company has investment interests in five companies in related industries. All of these interests are at ownership shares less than 20% . These investments are all flow-through entities. Per ASC 323-30-S99-1, they are being accounted for by the equity method of accounting under which the Company’s share of net income is recognized as income in the Company’s statements of operations and added to the investment account. Distributions or dividends received from the investments are treated as a reduction of the investment account. The Company consistently follows the practice of recognizing the net income based on the most recent reliable data. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the fair value of derivative financial instruments, lower of cost or net realizable value accounting for inventory and forward purchase contracts and goodwill impairment evaluation. Recently Issued Accounting Pronouncements In February 2016, FASB issued ASU No. 2016-02, "Leases (Topic 842)" (ASU 2016-02). ASU 2016-02 requires the recognition of lease assets and lease liabilities by lessees for all leases greater than one year in duration and classified as operating leases under previous GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and for interim periods within that fiscal year. The standard has not had a material impact on the Company's consolidated financial statements. In January 2017, FASB issued ASU No. 2017-04, "Intangibles-Goodwill and Other (Topic 350)" (ASU 2017-04). ASU 2107-04 simplifies the test for goodwill impairment. It eliminates the two-step process of assessing goodwill impairment and replaces it with one step which compares the fair value of the reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value exceeds the fair value up to the amount of the goodwill attributed to the reporting unit. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, and for interim periods within that fiscal year. The Company does not expect this standard to have a material impact on the Company's consolidated financial statements. In August 2018, FASB issued ASU No. 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement" (ASU 2018-13). ASU 2018-13 improves the effectiveness of the fair value disclosures in the financial statements. It adds, removes and modifies various disclosure requirements relating to the fair value hierarchy. ASU 2018-13 is effective for fiscal years beginning after December 15, 2019, and for interim periods within that fiscal year. The Company does not expect this standard to have a material impact on the Company's consolidated financial statements. |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2019 | |
Inventory [Abstract] | |
Inventory | INVENTORY Inventory consisted of the following as of September 30, 2019 and December 31, 2018 : September 30, 2019 December 31, 2018* Raw materials $ 4,667,113 $ 3,396,707 Finished goods 2,086,948 2,589,255 Work in process 802,294 514,881 Parts inventory 1,181,207 1,060,658 $ 8,737,562 $ 7,561,501 *Derived from audited financial statements. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2019 | |
Investments [Abstract] | |
Investments | INVESTMENTS Dakota Ethanol has a 6% investment interest in the Company’s ethanol marketer, Renewable Products Marketing Group, LLC (RPMG). The net income which is reported in the Company’s income statement for RPMG is based on RPMG’s June 30, 2019 unaudited interim results. The carrying amount of the Company’s investment was approximately $1,266,000 and $1,312,000 as of September 30, 2019 and December 31, 2018 , respectively. Dakota Ethanol has a 10% investment interest in Lawrenceville Tanks, LLC (LT), a partnership to operate an ethanol storage terminal in Georgia. The net income which is reported in the Company’s income statement for LT is based on LT’s September 30, 2019 unaudited interim results. The carrying amount of the Company’s investment was approximately $220,000 and $266,000 as of September 30, 2019 and December 31, 2018 , respectively. Lake Area Corn Processors has a 10% investment interest in Guardian Hankinson, LLC (GH), a partnership to operate an ethanol plant in North Dakota. The net income which is reported in the Company’s income statement for GH is based on GH’s September 30, 2019 unaudited interim results. The carrying amount of the Company’s investment was approximately $5,700,000 and $5,274,000 as of September 30, 2019 and December 31, 2018 , respectively. Lake Area Corn Processors has a 17% investment interest in Guardian Energy Management, LLC (GEM), a partnership to provide management services to ethanol plants. The net income which is reported in the Company’s income statement for GEM is based on GEM’s September 30, 2019 unaudited interim results. The carrying amount of the Company’s investment was approximately $53,000 as of September 30, 2019 and December 31, 2018 . Lake Area Corn Processors has an 11% investment interest in Ring-neck Energy and Feeds, LLC (REF), a partnership to operate an ethanol plant in South Dakota. The net income which is reported in the Company’s income statement for REF is based on REF’s September 30, 2019 unaudited interim results. The carrying amount of the Company’s investment was approximately $10,079,000 and $10,396,000 as of September 30, 2019 and December 31, 2018 , respectively. REF commenced operations during the second quarter of 2019. Prior to then, the ethanol plant was under construction. The carrying amount of the investment exceeds the underlying equity in net assets by approximately $1,129,000 . The excess is comprised of a basis adjustment of approximately $464,000 and capitalized interest of $665,000 . The excess is amortized over 20 years when the plant becomes operational. The amortization is recorded in equity in net income of investments. Amortization was $14,416 and 24,026 for the three and nine months ended September 30, 2019 . Condensed, combined unaudited financial information of the Company’s investments in RPMG, LT, GH, GEM and REF are as follows: Balance Sheet September 30, 2019 December 31, 2018 Current Assets $ 248,012,529 $ 189,839,430 Other Assets 233,745,711 234,748,455 Current Liabilities 209,307,583 175,836,322 Long-term Liabilities 103,674,630 78,589,892 Members' Equity 168,776,027 170,161,671 Three Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 94,474,407 $ 60,363,855 Gross Profit 5,266,631 3,772,673 Net (Loss) (2,645,668 ) (91,453 ) Nine Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 230,715,486 $ 190,895,421 Gross Profit 14,095,945 16,541,767 Net Income (Loss) (2,933,142 ) 6,472,358 The following table shows the condensed financial information of Guardian Hankinson: Balance Sheet September 30, 2019 December 31, 2018 Current Assets $ 17,986,800 $ 21,412,926 Other Assets 93,873,235 102,988,761 Current Liabilities 17,645,720 3,390,042 Long-term Liabilities 37,210,746 38,144,803 Members' Equity 57,003,569 52,353,842 Three Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 60,517,220 $ 56,647,869 Gross Profit 1,677,900 1,620,076 Net Income (Loss) 524,949 (627,787 ) Nine Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 182,761,442 $ 180,415,511 Gross Profit 8,284,287 10,581,169 Net Income 4,771,534 5,455,699 The following table shows the condensed financial information of Ring-neck Energy & Feed: Balance Sheet September 30, 2019 December 31, 2018 Current Assets $ 13,381,722 $ 1,018,076 Other Assets 137,635,508 128,668,387 Current Liabilities 4,774,475 5,724,979 Long-term Liabilities 66,463,884 40,414,089 Members' Equity 79,778,871 83,547,395 Three Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 30,246,280 $ — Gross Profit 1,345,363 — Net (Loss) (3,756,247 ) (84,776 ) Nine Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 37,070,921 $ — Gross (Loss) (594,383 ) — Net (Loss) (9,124,363 ) (162,667 ) The Company recorded equity in net income of approximately $52,000 and $427,000 from GH for the three and nine months ended September 30, 2019 . The Company recorded equity in net income (loss) of approximately $(63,000) and $546,000 from GH for the three and nine months ended September 30, 2018, respectively. The Company recorded equity in net (loss) of approximately ($444,000) and ($952,000) from REF for the three and nine months ended September 30, 2019 , respectively. The Company recorded equity in net (loss) of approximately $(11,000) and $(18,000) from REF for the three and nine months ended September 30, 2018, respectively. The Company recorded equity in net income of approximately $ 42,000 and $ 99,000 from its other investments for the three and nine months ended September 30, 2019 , respectively. The Company recorded equity in net income of approximately $ 43,000 and $ 80,000 from its other investments for the three and nine months ended September 30, 2018, respectively. |
Revolving Operating Note
Revolving Operating Note | 9 Months Ended |
Sep. 30, 2019 | |
Short Term Note Payable [Abstract] | |
Revolving Operating Note | REVOLVING OPERATING NOTE On February 6, 2018, Dakota Ethanol executed a revolving promissory note with Farm Credit Services of America (FCSA) in the amount up to $10,000,000 or the amount available in accordance with the borrowing base calculation, whichever is less. Interest on the outstanding principal balance will accrue at 300 basis points above the 1 month LIBOR rate and is not subject to a floor. The rate was 5.10% at September 30, 2019 . There is a non-use fee of 0.25% on the unused portion of the $10,000,000 availability. The note is collateralized by substantially all assets of the Company. The note expires on November 1, 2021. On September 30, 2019 , Dakota Ethanol had $0 outstanding and approximately $5,281,000 available to be drawn on the revolving promissory note under the borrowing base. |
Long-Term Notes Payable
Long-Term Notes Payable | 9 Months Ended |
Sep. 30, 2019 | |
Long Term Note Payable [Abstract] | |
Long-Term Notes Payable | LONG-TERM NOTES PAYABLE On August 1, 2017, Dakota Ethanol executed a term note from FCSA in the amount of $8,000,000 . Dakota Ethanol agreed to make monthly interest payments starting September 1, 2017 and annual principal payments of $1,000,000 starting on August 1, 2018. The notes matures on August 1, 2025. Interest on the outstanding principal balance will accrue at 325 basis points above the 1 month LIBOR rate and is not subject to a floor. The rate was 5.35% at September 30, 2019 . On September 30, 2019 , Dakota Ethanol had $6,000,000 outstanding on the note. On February 6, 2018, Dakota Ethanol executed a reducing revolving promissory note from FCSA in the amount up to $40,000,000 or the amount available in accordance with the borrowing availability under the credit agreement. This loan was amended on October 21, 2019. The amount Dakota Ethanol can borrow on the note decreases by $1,750,000 semi-annually starting on January 1, 2021 until the maximum balance reaches $26,000,000 on July 1, 2024. The note matures on January 1, 2026. Interest on the outstanding principal balance will accrue at 325 basis points above the 1 month LIBOR rate and is not subject to a floor. The rate was 5.35% at September 30, 2019 . The note contains a non-use fee of 0.50% on the unused portion of the note. On September 30, 2019 , Dakota Ethanol had $33,000,000 outstanding and $7,000,000 available to be drawn on the note. As part of the note payable agreement, Dakota Ethanol is subject to certain restrictive covenants establishing financial reporting requirements, distribution and capital expenditure limits, minimum debt service coverage ratios, net worth and working capital requirements. The note is collateralized by substantially all assets of the Company. The balances of the notes payable are as follows: September 30, 2019 December 31, 2018* Notes Payable - FCSA Revolving note $ 33,000,000 $ 17,600,000 Term note 6,000,000 7,000,000 Less unamortized debt issuance costs (11,667 ) (14,632 ) 38,988,333 24,585,368 Less current portion (1,000,000 ) (1,000,000 ) $ 37,988,333 $ 23,585,368 *Derived from audited financial statements Principal maturities for the next five years are estimated as follows: Years Ending September 30, Principal 2020 $ 1,000,000 2021 1,000,000 2022 1,000,000 2023 4,500,000 2024 4,500,000 thereafter 27,000,000 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The Company complies with the fair value measurements and disclosures standard which defines fair value, establishes a framework for measuring fair value, and expands disclosure for those assets and liabilities carried on the balance sheet on a fair value basis. The Company’s balance sheet contains derivative financial instruments that are recorded at fair value on a recurring basis. Fair value measurements and disclosures require that assets and liabilities carried at fair value be classified and disclosed according to the process for determining fair value. There are three levels of determining fair value. Level 1 uses quoted market prices in active markets for identical assets or liabilities. Level 2 uses observable market based inputs or unobservable inputs that are corroborated by market data. Level 3 uses unobservable inputs that are not corroborated by market data. A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. Derivative financial instruments . Commodity futures contracts are reported at fair value utilizing Level 1 inputs. For these contracts, the Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes and live trading levels from the CBOT and NYMEX markets. Over-the-counter commodity options contracts are reported at fair value utilizing Level 2 inputs. For these contracts, the Company obtains fair value measurements from an independent pricing service. The fair value measurements consider observable data that may include dealer quotes and live trading levels from the over-the-counter markets. Forward purchase contracts are reported at fair value utilizing Level 2 inputs. For these contracts, the Company obtains fair value measurements from local grain terminal bid values. The fair value measurements consider observable data that may include live trading bids from local elevators and processing plants which are based off the CBOT markets. The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018 segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: Total Level 1 Level 2 Level 3 September 30, 2019 Assets: Derivative financial instruments, futures contracts $ 20,363 $ 9,563 $ 10,800 $ — forward contracts $ 234,377 $ — $ 234,377 — Liabilities: Derivative financial instruments, futures contracts $ (52,738 ) $ (52,738 ) $ — $ — forward contracts $ (61,734 ) $ — $ (61,734 ) $ — December 31, 2018* Assets: Derivative financial instruments, futures contracts $ 175,038 $ 175,038 $ — $ — forward contracts $ 676 $ — $ 676 — Liabilities: Derivative financial instruments, futures contracts $ — $ — $ — $ — forward contracts $ 368,475 $ — $ 368,475 $ — *Derived from audited financial statements. During the three and nine months ended September 30, 2019 , the Company did not make any changes between Level 1 and Level 2 assets and liabilities. As of September 30, 2019 and December 31, 2018 , the Company did not have any Level 3 assets or liabilities. Certain financial assets and financial liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Financial assets and financial liabilities measured at fair value on a non-recurring basis were not significant at September 30, 2019 . Disclosure requirements for fair value of financial instruments require disclosure of the fair value of financial assets and financial liabilities, including those financial assets and financial liabilities that are not measured and reported at fair value on a recurring basis or nonrecurring basis. The methodologies for estimating the fair value of financial assets and financial liabilities that are measured at fair value on a recurring or non-recurring basis are discussed above. The Company believes the carrying amount of cash and cash equivalents (level 1), accounts receivable (level 2), other receivables (level 2), accounts payable and accruals (level 2) and short-term debt (level 3) approximates fair value. The carrying amount of long-term obligations (level 3) at September 30, 2019 of $39,000,000 had an estimated fair value of approximately $39,000,000 based on estimated interest rates for comparable debt. The carrying amount of long-term obligations at December 31, 2018 of $24,600,000 had an estimated fair value of approximately $24,600,000 . |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS Dakota Ethanol has a 6% interest in RPMG, and Dakota Ethanol has entered into marketing agreements for the exclusive rights to market, sell and distribute the entire ethanol, dried distiller's grains and corn oil inventories produced by Dakota Ethanol. The marketing fees are included in net revenues. Revenues and marketing fees related to the agreements are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues ethanol $ 25,602,911 $ 14,670,012 $ 62,706,692 $ 46,132,851 Revenues distillers dried grains 2,158,001 1,072,862 3,333,325 1,687,934 Revenues corn oil 1,253,882 570,841 3,064,398 1,665,261 Marketing fees ethanol 60,960 65,865 182,880 197,595 Marketing fees distillers dried grains 16,338 8,115 25,278 11,853 Marketing fees corn oil 10,431 4,726 25,007 14,250 September 30, 2019 December 31, 2018* Amounts due included in accounts receivable $ 3,700,131 $ 836,798 *Derived from audited financial statements. The Company purchased corn and services from members of its Board of Managers that farm and operate local businesses. The Company also purchased ingredients from RPMG. Purchases during the three and nine months ended September 30, 2019 totaled approximately $410,000 and $1,410,000 , respectively. Purchases during the three and nine months ended September 30, 2018 totaled approximately $319,000 and $1,181,000 , respectively. As of September 30, 2019 and December 31, 2018 , the amount we owed to related parties was approximately $27,000 and $37,000 , respectively. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements of the Company include the accounts of its wholly owned subsidiary, Dakota Ethanol. All significant inter-company transactions and balances have been eliminated in consolidation. |
Revenue Recognition | Revenue Recognition The Company has adopted the guidance of ASC Topic 606, Revenue from Contracts with Customers (Topic 606). Topic 606 requires the Company to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance requires the Company to apply the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the Company satisfies a performance obligation. The Company generally recognizes revenue at a point in time. The majority of the Company’s contracts with customers have one performance obligation and a contract duration of one year or less. The following is a description of principal activities from which we generate revenue. Revenues from contracts with customers are recognized when control of the promised goods or services are transferred to our customers in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. Generally, ethanol and related products are shipped FOB shipping point and the control of the goods transfers to customers when the goods are loaded into trucks or rail cars are released to the railroad. Consideration is based on predetermined contractual prices or on current market prices. • sales of ethanol • sales of distillers grains • sales of distillers corn oil Disaggregation of revenue: All revenue recognized in the income statement is considered to be revenue from contracts with customers. The following table depicts the disaggregation of revenue according to product line: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues ethanol $ 25,563,757 $ 14,599,385 $ 62,573,333 $ 45,970,750 Revenues distillers grains 5,634,315 3,630,835 14,539,232 11,056,256 Revenues distillers corn oil 1,243,438 566,136 3,039,231 1,650,956 $ 32,441,510 $ 18,796,356 $ 80,151,796 $ 58,677,962 Contract assets and contract liabilities: The Company has no significant contract assets or contract liabilities from contracts with customers. The Company receives payments from customers based upon contractual billing schedules; accounts receivable are recorded when the right to consideration becomes unconditional. Contract liabilities include payments received in advance of performance under the contract, and are realized with the associated revenue recognized under the contract. |
Shipping Costs | Shipping costs Shipping costs incurred by the Company in the sale of ethanol, dried distiller's grains and corn oil are not specifically identifiable and as a result, revenue from the sale of those products is recorded based on the net selling price reported to the Company from the marketer. When the Company performs shipping and handling activities after the transfer of control to the customers (e.g., when control transfers prior to delivery), they are considered fulfillment activities, and accordingly, the costs are accrued for when the related revenue is recognized. |
Operating Segment | Operating Segment The Company uses the "management approach" for reporting information about segments in annual and interim financial statements. The management approach is based on the way the chief operating decision-maker organizes segments within a company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure and any other manner in which management disaggregates a company. Based on the "management approach" model, the Company has determined that its business is comprised of a single operating segment. |
Cost of Revenues | Costs of Revenues The primary components of costs of revenues from the production of ethanol and related co-product are corn, energy (natural gas and electricity), raw materials (chemicals and denaturant), and direct labor costs. Shipping costs on modified and wet distiller's grains are included in costs of revenues. |
Inventory Valuation | Inventory Valuation Inventories are generally valued using methods which approximate the lower of cost (first-in, first-out) or net realizable value. In the valuation of inventories and purchase commitments, net realizable value is based on estimated selling prices in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. |
Receivables and Credit Policies | Receivables and Credit Policies Accounts receivable are uncollateralized customer obligations due under normal trade terms requiring payment within fifteen days from the invoice date. Unpaid accounts receivable with invoice dates over thirty days old bear interest at 1.5% per month. Accounts receivable are stated at the amount billed to the customer. Payments of accounts receivable are allocated to the specific invoices identified on the customer’s remittance advice or, if unspecified, are applied to the earliest unpaid invoices. The carrying amount of trade receivables is reduced by a valuation allowance that reflects management’s best estimate of the amounts that will not be collected. Management regularly reviews trade receivable balances and based on an assessment of current creditworthiness, estimates the portion, if any, of the balance that will not be collected. The valuation allowance was $2,131 as of September 30, 2019 and December 31, 2018 . |
Investment in commodities contracts, derivative instruments and hedging activities | Investment in commodities contracts, derivative instruments and hedging activities The Company is exposed to certain risks related to its ongoing business operations. The primary risks that the Company manages by using forward or derivative instruments are price risks on anticipated purchases of corn and natural gas and the sale of ethanol, distillers grains and distillers corn oil. The Company is subject to market risk with respect to the price and availability of corn, the principal raw material the Company uses to produce ethanol and ethanol by-products. In general, rising corn prices result in lower profit margins and, therefore, represent unfavorable market conditions. This is especially true when market conditions do not allow us to pass along increased corn costs to its customers. The availability and price of corn is subject to wide fluctuations due to unpredictable factors such as weather conditions, farmer planting decisions, governmental policies with respect to agriculture and international trade and global demand and supply. Certain contracts that literally meet the definition of a derivative may be exempted from derivative accounting as normal purchases or normal sales. Normal purchases and normal sales are contracts that provide for the purchase or sale of something other than a financial instrument or derivative instrument that will be delivered in quantities expected to be used or sold over a reasonable period in the normal course of business. Contracts that meet the requirements of normal purchases or sales are documented as normal and exempted from the accounting and reporting requirements of derivative accounting. The Company does not apply the normal purchase and sales exemption for forward corn purchase contracts. As of September 30, 2019 , the Company is committed to purchasing approximately 1.7 million bushels of corn on a forward contract basis with an average price of $3.74 per bushel. The total corn purchase contracts represent 6% of the annual projected plant corn usage. The Company enters into firm-price purchase commitments with natural gas suppliers under which the Company agrees to buy natural gas at a price set in advance of the actual delivery. Under these arrangements, the Company assumes the risk of a price decrease in the market price of natural gas between the time the price is fixed and the time the natural gas is delivered. At September 30, 2019 , the Company is committed to purchasing approximately 652,000 MMBtu’s of natural gas with an average price of $2.64 per MMBtu. The Company accounts for these transactions as normal purchases, and accordingly, does not mark these transactions to market. The natural gas purchase contracts represent 32% of the annual plant requirements. The Company enters into firm-price sales commitments with distillers grains customers under which the Company agrees to sell distillers grains at a price set in advance of the actual delivery. Under these arrangements, the Company assumes the risk of a price increase in the market price of distillers grain between the time the price is fixed and the time the distillers grains are delivered. At September 30, 2019 , the Company is committed to selling approximately 32,000 dry equivalent tons of distillers grains with an average price of $127 per ton. The Company accounts for these transactions as normal sales, and accordingly, does not mark these transactions to market. The distillers grains sales represent approximately 15% of the projected annual plant production. The Company enters into firm-price sales commitments with distillers corn oil customers under which the Company agrees to sell distillers corn oil at a price set in advance of the actual delivery. Under these arrangements, the Company assumes the risk of a price increase in the market price of distillers corn oil between the time the price is fixed and the time the distillers corn oil is delivered. At September 30, 2019 , the Company is committed to selling approximately 2.0 million pounds of distillers corn oil with an average price of $0.23 per pound. The Company accounts for these transactions as normal sales, and accordingly, does not mark these transactions to market. The distillers corn oil sales represent approximately 9% of the projected annual plant production. The Company does not have any firm-priced sales commitments for ethanol as of September 30, 2019 . The Company enters into short-term forward, option and futures contracts for ethanol, corn and natural gas as a means of managing exposure to changes in commodity and energy prices. All of the Company's derivatives are designated as non-hedge derivatives, and accordingly are recorded at fair value with changes in fair value recognized in net income. Although the contracts are considered economic hedges of specified risks, they are not designated as and accounted for as hedging instruments. As part of our trading activity, the Company uses futures and option contracts offered through regulated commodity exchanges to reduce risk of loss in the market value of inventories and purchase commitments. To reduce that risk, the Company generally takes positions using forward and futures contracts and options. Derivatives not designated as hedging instruments at September 30, 2019 and December 31, 2018 were as follows: Balance Sheet Classification September 30, 2019 December 31, 2018* Forward contracts in gain position $ 234,377 $ 676 Futures contracts in gain position 20,363 175,038 Futures contracts in loss position (52,738 ) — Total 202,002 175,714 Cash held by broker 271,761 378,291 Current Assets $ 473,763 $ 554,005 Forward contracts in loss position (Current Liabilities) $ (61,734 ) $ (368,475 ) *Derived from audited financial statements Futures contracts and cash held by broker are all with one party and the right of offset exists. Therefore, on the balance sheet, these items are netted in one balance regardless of position. Forward contracts are with multiple parties and the right of offset does not exist. Therefore, these contracts are reported at the gross amounts on the balance sheet. Realized and unrealized gains and losses related to derivative contracts related to corn and natural gas purchases are included as a component of costs of revenues and derivative contracts related to ethanol sales are included as a component of revenues in the accompanying financial statements. Statement of Operations Three Months Ended September 30, Classification 2019 2018 Net realized and unrealized gains (losses) related to purchase contracts: Futures contracts Cost of Revenues $ (788,253 ) $ 762,395 Forward contracts Cost of Revenues (424,895 ) (844,490 ) Statement of Operations Nine Months Ended September 30, Classification 2019 2018 Net realized and unrealized gains (losses) related to purchase contracts: Futures contracts Cost of Revenues $ (113,672 ) $ 1,755,445 Forward contracts Cost of Revenues 53,655 (1,498,835 ) |
Investments | Investments The Company has investment interests in five companies in related industries. All of these interests are at ownership shares less than 20% . These investments are all flow-through entities. Per ASC 323-30-S99-1, they are being accounted for by the equity method of accounting under which the Company’s share of net income is recognized as income in the Company’s statements of operations and added to the investment account. Distributions or dividends received from the investments are treated as a reduction of the investment account. The Company consistently follows the practice of recognizing the net income based on the most recent reliable data. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the fair value of derivative financial instruments, lower of cost or net realizable value accounting for inventory and forward purchase contracts and goodwill impairment evaluation |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, FASB issued ASU No. 2016-02, "Leases (Topic 842)" (ASU 2016-02). ASU 2016-02 requires the recognition of lease assets and lease liabilities by lessees for all leases greater than one year in duration and classified as operating leases under previous GAAP. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, and for interim periods within that fiscal year. The standard has not had a material impact on the Company's consolidated financial statements. In January 2017, FASB issued ASU No. 2017-04, "Intangibles-Goodwill and Other (Topic 350)" (ASU 2017-04). ASU 2107-04 simplifies the test for goodwill impairment. It eliminates the two-step process of assessing goodwill impairment and replaces it with one step which compares the fair value of the reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying value exceeds the fair value up to the amount of the goodwill attributed to the reporting unit. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, and for interim periods within that fiscal year. The Company does not expect this standard to have a material impact on the Company's consolidated financial statements. In August 2018, FASB issued ASU No. 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement" (ASU 2018-13). ASU 2018-13 improves the effectiveness of the fair value disclosures in the financial statements. It adds, removes and modifies various disclosure requirements relating to the fair value hierarchy. ASU 2018-13 is effective for fiscal years beginning after December 15, 2019, and for interim periods within that fiscal year. The Company does not expect this standard to have a material impact on the Company's consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Disaggregation of Revenue | The following table depicts the disaggregation of revenue according to product line: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues ethanol $ 25,563,757 $ 14,599,385 $ 62,573,333 $ 45,970,750 Revenues distillers grains 5,634,315 3,630,835 14,539,232 11,056,256 Revenues distillers corn oil 1,243,438 566,136 3,039,231 1,650,956 $ 32,441,510 $ 18,796,356 $ 80,151,796 $ 58,677,962 |
Derivatives Not Designated as Hedging Instruments | Derivatives not designated as hedging instruments at September 30, 2019 and December 31, 2018 were as follows: Balance Sheet Classification September 30, 2019 December 31, 2018* Forward contracts in gain position $ 234,377 $ 676 Futures contracts in gain position 20,363 175,038 Futures contracts in loss position (52,738 ) — Total 202,002 175,714 Cash held by broker 271,761 378,291 Current Assets $ 473,763 $ 554,005 Forward contracts in loss position (Current Liabilities) $ (61,734 ) $ (368,475 ) *Derived from audited financial statements |
Net realized and unrealized gains (losses) related to purchase contracts | Statement of Operations Three Months Ended September 30, Classification 2019 2018 Net realized and unrealized gains (losses) related to purchase contracts: Futures contracts Cost of Revenues $ (788,253 ) $ 762,395 Forward contracts Cost of Revenues (424,895 ) (844,490 ) Statement of Operations Nine Months Ended September 30, Classification 2019 2018 Net realized and unrealized gains (losses) related to purchase contracts: Futures contracts Cost of Revenues $ (113,672 ) $ 1,755,445 Forward contracts Cost of Revenues 53,655 (1,498,835 ) |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory [Abstract] | |
Schedule of Inventory | Inventory consisted of the following as of September 30, 2019 and December 31, 2018 : September 30, 2019 December 31, 2018* Raw materials $ 4,667,113 $ 3,396,707 Finished goods 2,086,948 2,589,255 Work in process 802,294 514,881 Parts inventory 1,181,207 1,060,658 $ 8,737,562 $ 7,561,501 *Derived from audited financial statements. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Investments [Abstract] | |
Equity Method Investments | Condensed, combined unaudited financial information of the Company’s investments in RPMG, LT, GH, GEM and REF are as follows: Balance Sheet September 30, 2019 December 31, 2018 Current Assets $ 248,012,529 $ 189,839,430 Other Assets 233,745,711 234,748,455 Current Liabilities 209,307,583 175,836,322 Long-term Liabilities 103,674,630 78,589,892 Members' Equity 168,776,027 170,161,671 Three Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 94,474,407 $ 60,363,855 Gross Profit 5,266,631 3,772,673 Net (Loss) (2,645,668 ) (91,453 ) Nine Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 230,715,486 $ 190,895,421 Gross Profit 14,095,945 16,541,767 Net Income (Loss) (2,933,142 ) 6,472,358 The following table shows the condensed financial information of Guardian Hankinson: Balance Sheet September 30, 2019 December 31, 2018 Current Assets $ 17,986,800 $ 21,412,926 Other Assets 93,873,235 102,988,761 Current Liabilities 17,645,720 3,390,042 Long-term Liabilities 37,210,746 38,144,803 Members' Equity 57,003,569 52,353,842 Three Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 60,517,220 $ 56,647,869 Gross Profit 1,677,900 1,620,076 Net Income (Loss) 524,949 (627,787 ) Nine Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 182,761,442 $ 180,415,511 Gross Profit 8,284,287 10,581,169 Net Income 4,771,534 5,455,699 The following table shows the condensed financial information of Ring-neck Energy & Feed: Balance Sheet September 30, 2019 December 31, 2018 Current Assets $ 13,381,722 $ 1,018,076 Other Assets 137,635,508 128,668,387 Current Liabilities 4,774,475 5,724,979 Long-term Liabilities 66,463,884 40,414,089 Members' Equity 79,778,871 83,547,395 Three Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 30,246,280 $ — Gross Profit 1,345,363 — Net (Loss) (3,756,247 ) (84,776 ) Nine Months Ended Income Statement September 30, 2019 September 30, 2018 Revenue $ 37,070,921 $ — Gross (Loss) (594,383 ) — Net (Loss) (9,124,363 ) (162,667 ) |
Long-Term Notes Payable (Tables
Long-Term Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Long Term Note Payable [Abstract] | |
Schedule of Long-term Debt Instruments | The balances of the notes payable are as follows: September 30, 2019 December 31, 2018* Notes Payable - FCSA Revolving note $ 33,000,000 $ 17,600,000 Term note 6,000,000 7,000,000 Less unamortized debt issuance costs (11,667 ) (14,632 ) 38,988,333 24,585,368 Less current portion (1,000,000 ) (1,000,000 ) $ 37,988,333 $ 23,585,368 *Derived from audited financial statements |
Schedule of Principal repayment and amortization of debt issuance cost | Principal maturities for the next five years are estimated as follows: Years Ending September 30, Principal 2020 $ 1,000,000 2021 1,000,000 2022 1,000,000 2023 4,500,000 2024 4,500,000 thereafter 27,000,000 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping | The following table summarizes financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018 segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: Total Level 1 Level 2 Level 3 September 30, 2019 Assets: Derivative financial instruments, futures contracts $ 20,363 $ 9,563 $ 10,800 $ — forward contracts $ 234,377 $ — $ 234,377 — Liabilities: Derivative financial instruments, futures contracts $ (52,738 ) $ (52,738 ) $ — $ — forward contracts $ (61,734 ) $ — $ (61,734 ) $ — December 31, 2018* Assets: Derivative financial instruments, futures contracts $ 175,038 $ 175,038 $ — $ — forward contracts $ 676 $ — $ 676 — Liabilities: Derivative financial instruments, futures contracts $ — $ — $ — $ — forward contracts $ 368,475 $ — $ 368,475 $ — |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Revenues and marketing fees related to the agreements are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 Revenues ethanol $ 25,602,911 $ 14,670,012 $ 62,706,692 $ 46,132,851 Revenues distillers dried grains 2,158,001 1,072,862 3,333,325 1,687,934 Revenues corn oil 1,253,882 570,841 3,064,398 1,665,261 Marketing fees ethanol 60,960 65,865 182,880 197,595 Marketing fees distillers dried grains 16,338 8,115 25,278 11,853 Marketing fees corn oil 10,431 4,726 25,007 14,250 September 30, 2019 December 31, 2018* Amounts due included in accounts receivable $ 3,700,131 $ 836,798 |
Nature of Operations (Details)
Nature of Operations (Details) gal in Millions | 9 Months Ended |
Sep. 30, 2019gal | |
Product Information [Line Items] | |
Equity Method Investments, Number of Entities | 5 |
Product [Member] | Ethanol [Member] | |
Product Information [Line Items] | |
Annual production capacity | 90 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Revenue from customers (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Including Assessed Tax | $ 32,441,510 | $ 18,796,356 | $ 80,151,796 | $ 58,677,962 |
Ethanol [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Including Assessed Tax | 25,563,757 | 14,599,385 | 62,573,333 | 45,970,750 |
Distillers Grain [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Including Assessed Tax | 5,634,315 | 3,630,835 | 14,539,232 | 11,056,256 |
Corn Oil [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from Contract with Customer, Including Assessed Tax | $ 1,243,438 | $ 566,136 | $ 3,039,231 | $ 1,650,956 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Receivables and Credit Policies (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Receivables [Abstract] | ||
Payment term | 15 days | |
Payment term before interest is applied | 30 days | |
Trade Receivable, Unpaid Balance, Interest Rate | 1.50% | |
SEC Schedule, 12-09, Valuation Allowances and Reserves, Amount | $ 2,131 | $ 2,131 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Derivative Instruments - Balance Sheet (Details) bu in Millions | Sep. 30, 2019USD ($)buMMBTUT$ / MMBTU$ / usd_per_lb$ / T$ / bu | Dec. 31, 2018USD ($) |
Derivatives, Fair Value [Line Items] | ||
Derivative Instruments and Hedges, Assets | $ 473,763 | $ 554,005 |
Derivative Instruments and Hedges, Liabilities | 61,734 | 368,475 |
Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Cash held by broker | 271,761 | 378,291 |
Current Assets [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, current | 202,002 | 175,714 |
Derivative Instruments and Hedges, Assets | 473,763 | 554,005 |
Other Current Liabilities [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Instruments and Hedges, Liabilities | $ 61,734 | 368,475 |
Corn [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Number of instruments held | bu | 1.7 | |
Average price per unit | $ / bu | 3.74 | |
Percent of required need, coverage | 6.00% | |
Natural Gas [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Number of instruments held | MMBTU | 652,000 | |
Average price per unit | $ / MMBTU | 2.64 | |
Percent of required need, coverage | 32.00% | |
Distillers Grain [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Percent of required need, coverage | 15.00% | |
Forward Contracts [Member] | Current Assets [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, current | $ 234,377 | 676 |
Distillers Grain [Domain] | ||
Derivatives, Fair Value [Line Items] | ||
Number of instruments held | T | 32,000 | |
Average price per unit | $ / T | 127 | |
Distillers Corn Oil [Domain] | ||
Derivatives, Fair Value [Line Items] | ||
Number of instruments held | bu | 2 | |
Average price per unit | $ / usd_per_lb | 0.23 | |
Percent of required need, coverage | 9.00% | |
Futures contracts in gain position [Member] | Future [Member] | Current Assets [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, current | $ 20,363 | 175,038 |
Futures Contracts held in loss position [Member] | Future [Member] | Other Current Liabilities [Member] | Not Designated as Hedging Instrument [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, current | $ 52,738 | $ 0 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Derivative Instruments - Income Statement (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($)$ / usd_per_lb | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)$ / usd_per_lb | Sep. 30, 2018USD ($) | |
Distillers Corn Oil [Domain] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Average price per unit | $ / usd_per_lb | 0.23 | 0.23 | ||
Not Designated as Hedging Instrument [Member] | Cost of Sales [Member] | Future [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | $ (788,253) | $ 762,395 | $ (113,672) | $ 1,755,445 |
Not Designated as Hedging Instrument [Member] | Cost of Sales [Member] | Forward Contracts [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative, Gain (Loss) on Derivative, Net | $ (424,895) | $ (844,490) | $ 53,655 | $ (1,498,835) |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Investments (Details) | Sep. 30, 2019 |
Accounting Policies [Abstract] | |
Equity Method Investments, Number of Entities | 5 |
Ownership percentage in equity method investments (less than) | 20.00% |
Inventory (Details)
Inventory (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory [Abstract] | ||
Raw Materials | $ 4,667,113 | $ 3,396,707 |
Finished Goods | 2,086,948 | 2,589,255 |
Work in Process | 802,294 | 514,881 |
Parts Inventory | 1,181,207 | 1,060,658 |
Inventory | $ 8,737,562 | $ 7,561,501 |
Investments (Details)
Investments (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 20.00% | 20.00% | |||
Investments | $ 17,317,302 | $ 17,317,302 | $ 17,300,470 | ||
Current Assets | 248,012,529 | 248,012,529 | 189,839,430 | ||
Other Assets | 233,745,711 | 233,745,711 | 234,748,455 | ||
Current Liabilities | 209,307,583 | 209,307,583 | 175,836,322 | ||
Long-term Liabilities | 103,674,630 | 103,674,630 | 78,589,892 | ||
Members' Equity | 168,776,027 | 168,776,027 | 170,161,671 | ||
Revenue | 94,474,407 | $ 60,363,855 | 230,715,486 | $ 190,895,421 | |
Gross Profit | 5,266,631 | 3,772,673 | 14,095,945 | 16,541,767 | |
Net Income (Loss) | (2,645,668) | (91,453) | (2,933,142) | 6,472,358 | |
Equity in net income (loss) of investments | $ (349,123) | (30,513) | $ (425,776) | 559,970 | |
Renewable Products Marketing Group, LLC (RPMG) [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 6.00% | 6.00% | |||
Investments | $ 1,266,000 | $ 1,266,000 | 1,312,000 | ||
Lawrenceville Tanks, LLC [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 10.00% | 10.00% | |||
Investments | $ 220,000 | $ 220,000 | 266,000 | ||
Guardian Hankinson, LLC [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 10.00% | 10.00% | |||
Investments | $ 5,700,000 | $ 5,700,000 | 5,274,000 | ||
Current Assets | 17,986,800 | 17,986,800 | 21,412,926 | ||
Other Assets | 93,873,235 | 93,873,235 | 102,988,761 | ||
Current Liabilities | 17,645,720 | 17,645,720 | 3,390,042 | ||
Long-term Liabilities | 37,210,746 | 37,210,746 | 38,144,803 | ||
Members' Equity | 57,003,569 | 57,003,569 | 52,353,842 | ||
Revenue | 60,517,220 | 56,647,869 | 182,761,442 | 180,415,511 | |
Gross Profit | 1,677,900 | 1,620,076 | 8,284,287 | 10,581,169 | |
Net Income (Loss) | 524,949 | (627,787) | 4,771,534 | 5,455,699 | |
Equity in net income (loss) of investments | $ 52,000 | (63,000) | $ 427,000 | 546,000 | |
Guardian Energy Management [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 17.00% | 17.00% | |||
Investments | $ 53,000 | $ 53,000 | 53,000 | ||
Ring-Neck Energy and Feeds, LLC [Domain] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Ownership percentage | 11.00% | 11.00% | |||
Ring-neck Energy and Feeds [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investments | $ 10,079,000 | $ 10,079,000 | 10,396,000 | ||
Accretion (Amortization) of Discounts and Premiums, Investments | 1,129,000 | ||||
Basis adjustment | 464,000 | ||||
Capitalized interest | $ 665,000 | ||||
Amortization period for amortization of investment premium | 20 years | ||||
Amortization | 14,416 | $ 24,026 | |||
Current Assets | 13,381,722 | 13,381,722 | 1,018,076 | ||
Other Assets | 137,635,508 | 137,635,508 | 128,668,387 | ||
Current Liabilities | 4,774,475 | 4,774,475 | 5,724,979 | ||
Long-term Liabilities | 66,463,884 | 66,463,884 | 40,414,089 | ||
Members' Equity | 79,778,871 | 79,778,871 | $ 83,547,395 | ||
Revenue | 30,246,280 | 0 | 37,070,921 | 0 | |
Gross Profit | 1,345,363 | 0 | (594,383) | 0 | |
Net Income (Loss) | (3,756,247) | (84,776) | (9,124,363) | (162,667) | |
Equity in net income (loss) of investments | (444,000) | (11,000) | (952,000) | (18,000) | |
Other Investments Combined [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity in net income (loss) of investments | $ 42,000 | $ 43,000 | $ 99,000 | $ 80,000 |
Revolving Operating Note (Detai
Revolving Operating Note (Details) - Farm Credit Services of America [Member] - Line of Credit [Member] - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Feb. 06, 2018 | |
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 10,000,000 | $ 10,000,000 |
Basis spread on variable rate | 3.00% | |
Interest rate at period end | 5.10% | |
Unused capacity, commitment fee percentage | 0.25% | |
Amount outstanding | $ 0 | |
Remaining borrowing capacity | $ 5,281,000 |
Long-Term Notes Payable (Detail
Long-Term Notes Payable (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 33,000,000 | $ 17,600,000 |
Long-term debt | 38,988,333 | 24,585,368 |
Unamortized debt issuance expense | (11,667) | (14,632) |
Long-term debt, current maturities | (1,000,000) | (1,000,000) |
Long-term debt, excluding current maturities | 37,988,333 | $ 23,585,368 |
2020 | 1,000,000 | |
2021 | 1,000,000 | |
2022 | 1,000,000 | |
2023 | 4,500,000 | |
2024 | 4,500,000 | |
thereafter | 27,000,000 | |
Farm Credit Services of America [Member] | Medium-term Notes [Member] | ||
Debt Instrument [Line Items] | ||
Medium-term notes | 8,000,000 | |
Annual principal payment | $ 1,000,000 | |
Interest rate | 5.35% | |
Basis spread on variable rate | 3.25% | |
Medium-term notes, current | $ 6,000,000 | |
Farm Credit Services of America [Member] | Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 3.25% | |
Current borrowing capacity | $ 40,000,000 | |
Periodic decrease in line of credit availability | 1,750,000 | |
Maximum borrowing capacity | $ 26,000,000 | |
Interest rate at period end | 5.35% | |
Unused capacity, commitment fee percentage | 0.50% | |
Amount outstanding | $ 33,000,000 | |
Remaining borrowing capacity | $ 7,000,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, gross | $ 33,000,000 | $ 17,600,000 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, gross | 39,000,000 | 24,600,000 |
Long-term debt, fair value | 39,000,000 | 24,600,000 |
Fair Value, Measurements, Recurring [Member] | Future [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 20,363 | 175,038 |
Derivative liability | 52,738 | 0 |
Fair Value, Measurements, Recurring [Member] | Future [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 9,563 | 175,038 |
Derivative liability | 52,738 | 0 |
Fair Value, Measurements, Recurring [Member] | Future [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 10,800 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Future [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Forward Contracts [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 234,377 | 676 |
Derivative liability | 61,734 | (368,475) |
Fair Value, Measurements, Recurring [Member] | Forward Contracts [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Forward Contracts [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 234,377 | 676 |
Derivative liability | 61,734 | (368,475) |
Fair Value, Measurements, Recurring [Member] | Forward Contracts [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | $ 0 | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | |||||
Ownership percentage | 20.00% | 20.00% | |||
Amounts due included in accounts receivable | $ 3,700,131 | $ 3,700,131 | $ 836,798 | ||
Renewable Products Marketing Group, LLC (RPMG) [Member] | |||||
Related Party Transaction [Line Items] | |||||
Ownership percentage | 6.00% | 6.00% | |||
Purchases from related party | $ 410,000 | $ 319,000 | $ 1,410,000 | $ 1,181,000 | |
Due to related parties | 27,000 | 27,000 | $ 37,000 | ||
Ethanol [Member] | Renewable Products Marketing Group, LLC (RPMG) [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue, related party | 25,602,911 | 14,670,012 | 62,706,692 | 46,132,851 | |
Marketing fees, related party | 60,960 | 65,865 | 182,880 | 197,595 | |
Distillers Grain [Member] | Renewable Products Marketing Group, LLC (RPMG) [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue, related party | 2,158,001 | 1,072,862 | 3,333,325 | 1,687,934 | |
Marketing fees, related party | 16,338 | 8,115 | 25,278 | 11,853 | |
Corn Oil [Member] | Renewable Products Marketing Group, LLC (RPMG) [Member] | |||||
Related Party Transaction [Line Items] | |||||
Revenue, related party | 1,253,882 | 570,841 | 3,064,398 | 1,665,261 | |
Marketing fees, related party | $ 10,431 | $ 4,726 | $ 25,007 | $ 14,250 |