Minn-Dak Farmers Cooperative Form 10-Q/A for the Quarter Ended February 28, 2005

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Minn-Dak Farmers Cooperative has previously registered securities for offer and sale pursuant to the Securities Act of 1933, as amended (the “Securities Act”). As a result of that previous registration under the Securities Act, under Sections 15(d) and 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Cooperative is obligated to file quarterly reports on form 10-Q, annual reports on Form 10-K and supplemental reports on Form 8-K. However, the Cooperative has not registered any of its securities under Section 12(g) of the Exchange Act. The Cooperative is exempt from any obligation to register its securities under the Exchange Act due to the provisions of Section 12(g)(2)(E), which exempts from Exchange Act registration any security of an issuer, such as the Cooperative, which is a “cooperative association” as defined in the Agricultural Marketing Act of 1929. As a result, those provisions of the Exchange Act, which are applicable only to securities registered under Section 12 of that act, do not apply to shares issued by the Cooperative. The provisions, which do not apply to the Cooperative’s shares, include the regulation of proxies under Section 14 of the Exchange Act and the reporting and other obligations of directors, officers and principal stockholders under Section 16 of the Exchange Act.

ASSETS	Feb 28, 2005 (Unaudited)			Aug 31, 2004 (Unaudited)

CURRENT ASSETS:
Cash	$	555		$	270

Receivables:
Trade accounts		15,701			16,662
Growers		30			3,959
Other		21			632
		15,752			21,252

Advances to affiliate		(208	)		(259	)
Inventories:
Refined sugar, thick juice, pulp and molasses to be sold on a pooled basis		58,770			19,338
Nonmember refined sugar		910			4
Yeast		98			94
Materials and supplies		5,667			6,625
Beet inventory		22,286			—
Other Inventory		—			—
		87,730			26,061
Deferred charges		411			1,252
Prepaid expenses		493			2,333
Other		6,411			—
Current deferred income tax asset		502			502

Total current assets		111,645			51,411

PROPERTY, PLANT AND EQUIPMENT:
Land and land improvements		22,875			22,769
Buildings		37,115			37,115
Factory equipment		127,715			127,715
Other equipment		3,468			3,468
Construction in progress		2,325			1,096
		193,498			192,163
Less accumulated depreciation		(93,555	)		(89,882	)
		99,943			102,281

OTHER ASSETS:
Investments restricted for capital lease projects		2,498			2,472
Investment in stock of other corporations, unconsolidated marketing subsidiaries and other cooperatives		9,860			10,074
Other		1,873			2,066
		14,231			14,612

	$	225,819		$	168,304

	Feb 28, 2005 (Unaudited)		Aug 31, 2004 (Unaudited)
LIABILITIES AND MEMBERS’ INVESTMENT

CURRENT LIABILITIES:
Short-term notes payable	$	46,975	$	10,145

Current portion of long-term debt		3,600		3,600
Current portion of bonds payable		1,725		960
		5,325		4,560
Accounts payable:
Trade		1,503		3,542
Growers		27,446		14,904
		28,949		18,447


Accrued liabilities		4,645		3,681

Total current liabilities		85,894		36,833

LONG-TERM DEBT, NET OF CURRENT PORTION		22,300		24,700

BONDS PAYABLE		19,230		20,955

LONG TERM DEFERRED TAX LIABILITY		1,242		1,242

OTHER		612		612

COMMITTMENTS AND CONTINGENCIES		—		—

Total liabilities		129,278		84,343

MINORITY INTEREST IN EQUITY OF SUBSIDIARY		1,910		1,810

MEMBERS’ INVESTMENT:
Preferred stock:
Class A - 100,000 shares authorized, $105 par value; 72,200 shares issued and outstanding		7,581		7,581
Class B - 100,000 shares authorized, $75 par value; 72,200 shares issued and outstanding		5,415		5,415
Class C - 100,000 shares authorized, $76 par value; 72,200 shares issued and outstanding		5,487		5,487
		18,483		18,483
Common stock, 600 shares authorized, $250 par value; issued and outstanding, 484 shares at Feb 28, 2005 and 488 shares at August 31, 2004		121		122
Paid in capital in excess of par value		32,094		32,094
Unit retention capital		3,042		3,049
Qualified allocated patronage		1,634		1,638
Nonqualified allocated patronage		32,599		20,510
Retained earnings (deficit)		6,659		6,254
		94,632		82,150

	$	225,819	$	168,304

	Three Months Ended February 28,					Six Months Ended February 28,
	2005		2004			2005		2004
REVENUE:
From sales of sugar, co-products, and yeast, net of discounts	$	67,310	$	80,506		$	133,292	$	147,707
Other income		14		(97	)		79		86
		67,324		80,409			133,370		147,793

EXPENSES:
Production costs of sugar, co-products, and yeast sold		18,555		16,496			34,342		31,214
Marketing (includes freight and storage)		7,678		7,545			19,895		14,644
General and administrative		1,768		1,686			3,292		3,137
Interest		876		877			1,589		1,595
(Gain) loss on disposition of property and equipment		—		—			—		—
		28,877		26,604			59,117		50,590

NET PROCEEDS RESULTING FROM MEMBER AND NONMEMBER BUSINESS	$	38,447	$	53,805		$	74,251	$	97,204

DISTRIBUTION OF NET PROCEEDS:
Credited to members’ investment:
Components of net income:
Income (loss) from non-member business	$	197	$	229		$	405	$	481
Patronage income		6,517		12,543			12,089		21,121
Net income		6,714		12,772			12,494		21,602

Unit retention capital		—		—			—		—
Net credit to members’ investment		6,714		12,772			12,494		21,602

Payments to members for sugarbeets, net of unit retention capital		31,731		41,033			61,756		75,602

NET PROCEEDS RESULTING FROM MEMBER AND NONMEMBER BUSINESS	$	38,447	$	53,805		$	74,251	$	97,204

	Six Months Ended February 28,
	2005			2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Income allocated to members’ investment	$	12,494		$	21,602
Add (deduct) noncash items:
Depreciation and amortization		3,853			3,713
Net income allocated from unconsolidated marketing subsidiaries		(4	)		(6	)
Minority interest in equity of subsidiaries		100			119
Changes in operating assets and liabilities:
Accounts receivable and advances		5,448			1,866
Inventory and prepaid expenses		(66,241	)		(69,706	)
Deferred charges and other assets		1,277			773
Accounts payable, accrued liabilities and other liabilities		11,465			5,181
Net cash used in operating activities		(31,607	)		(36,457	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(1,318	)		(2,227	)
Net proceeds from patronage refunds and equity revolvements		217			196
Issuance of notes receivable		(128	)		—
Restricted bond fund investment		(26	)		132
Net cash used in investing activities		(1,256	)		(1,899	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of short-term debt		36,830			40,763
Payment of long-term debt		(3,360	)		(3,305	)
Payment of financing fees		(313	)		—
Payment of unit retains and allocated patronage		(10	)		(10	)
Sale and repurchase of common stock, net		1			1
Net cash provided by financing activities		33,148			37,449

NET DECREASE IN CASH		285			(907	)

CASH, BEGINNING OF YEAR		270			1,584

CASH, END OF QUARTER	$	555		$	300

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash payments for:
Interest	$	1,356		$	1,377

Income taxes, net of refunds	$	6		$	3

	Pension Benefits						Other Benefits
000’s	2005			2004			2005		2004
Service Cost	$	405		$	367		$	0	$	0
Interest Cost		658			576			0		0
Expected return on plan assets		(548	)		(466	)		0		0
Amortization of prior service cost		44			43			0		0
Amortization of transition cost		0			(4	)		0		0
Amortization of net (gain) loss		109			115			0		0
Net periodic benefit cost	$	668		$	631		$	0	$	0

As of the six months ended 2-28-05, the Company has made $.53 million of contributions vs. $.52 million through the six months ended 2-28-04. The Company anticipates contributing an additional $.47 million to fund its pension plan in FY 2005 for a total of $1.0 million.

FOR THE THREE MONTHS ENDED AND SIX MONTHS ENDED FEBRUARY 28, 2005 AND FEBRUARY 29, 2004

The following discussion and analysis relates to the financial condition and results of operations of Minn-Dak Farmers Cooperative (“the Company”) for the three months ended February 28, 2005 (the second quarter of the Company’s 2004-2005 fiscal year) and February 29, 2004 (the second quarter of the Company’s 2003-2004 fiscal year). The Company’s fiscal year runs from September 1 to August 31.

Any statements regarding future market prices, anticipated costs, agricultural results, operating results and other statements that are not historical facts contained in this Quarterly Report on Form 10-Q are forward-looking statements. The words “expect”, “project”, “estimate”, “believe”, “anticipate”, “plan”, “intend”, “could”, “may”, “predict” and similar expressions are also intended to identify forward-looking statements. Such statements involve risks, uncertainties and assumptions, including, without limitation, market factors, the effect of weather and economic conditions, farm and trade policy, the available supply of sugar, available quantity and quality of sugarbeets and other factors detailed elsewhere in this and other Company filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated.

During the review of the 2^nd quarter 10-q for FY2006, it was discovered the finished goods inventory was not properly reconciled prior to the filing of the 10-q. This was corrected prior to the filing of the 2^nd quarter 10-q and controls have been put in place to prevent future errors. Management also reviewed closely how it was valuing finished goods inventory and thick juice inventory. It was determined that thick juice inventory should be recorded at NRV, and not at cost for the interim financial statements in order to be consistent with accounting principles that would be applied at fiscal year end if any thick juice were present. It was also determined the NRV for products should take into account year to date activity and the most current estimate to arrive at a calculated NRV for any inventory to be valued at NRV. This statement has been amended and adjusted to account for these changes in control.

Comparison of the three months ended February 28, 2005 and February 29, 2004

Revenue for the three months ended February 28, 2005 decreased $13.2 million from the 2004 period, a decrease of 16.4%. Revenue from the sale of finished goods decreased $1.2 million and the change in the value of inventories decreased $12.0 million.

Revenue from the sales of sugar decreased $1.1, or 2.6% reflecting a 2.9% decrease in volume and a .3% increase in the price for sugar.

Revenue from dried pulp and molasses sales increased $.1 million or 1.8%, reflecting an 11.4% decrease in sales volume and a 13.2% increase in the average gross selling price. The decrease in sales volume was primarily due to a decreased supply of available product for shipment in the molasses marketing pool.

Revenues from pressed pulp and tailing sales decreased $.1 million, reflecting a 27.9% decrease in sales volume. The reduced sales volume is primarily due to the steam dryer operating on a more consistent basis in 2005 resulting in less excess pressed pulp to be marketed.

Revenues from yeast sales decreased $0.1 million or 5.1%, reflecting a 5.5% increase in sales volume and a 10.6% decrease in the average selling price. The average selling price is based upon a formula between Minn-Dak Yeast Company and Sensient whereby average selling prices to customers along with average costs of production are taken into account in establishing the price Sensient pays Minn-Dak Yeast for product. As sales volumes increase or decrease, the efficiencies of production costs will cause the formula to decrease or increase the selling price. Also, the domestic yeast industry is currently in a position of excess capacity for the marketplace resulting in downward price pressures.

The other contributing factor to the change in revenues results from the increase in finished goods inventories. The increase in the value of finished goods inventories for the three months ended February 28, 2005 amounted to $20.7 million or $12.0 million less than the increase in the value of finished goods inventories for February 29, 2004. The change in inventories was primarily due to a reduced volume of production.

In the consolidated Statement of Operations, Expenses section, production costs of sugar, co-products and yeast totaled $18.5 million, $1.8 million or 10.5% more than the prior year. The increase is mainly attributable to higher energy costs resulting from price increases and higher operations and maintenance costs associated with the crop quality when comparing the three-month period ending February 28, 2005 to the three-month period ending February 29, 2004. Marketing costs totaled $7.7 million, $.1 million or 1.8% more than the prior year.

In the section Distribution of Net Proceeds, payments to members for sugarbeets, net of unit retention capital, decreased $4.4 million or 13.3%. For fiscal year 2005 the Company is projecting a payment to growers for sugarbeets totaling $80.9 million, which is $21.2 million or 20.8% less than the prior fiscal year. The decrease in payments to members is due to: (1) the result of a 1.45% increase in tons of beets delivered by members versus the prior year, (2) 10.9% less sugar per ton of the beets delivered versus the prior year, and (3) 2.6% less net sales price on sugar sold. The payment is based upon (i) an average delivered sugar content of 16.71%, (ii) a total sugarbeet crop to process of 2.3 million tons and (iii) the Company’s projected selling price for its sugar, which is currently estimated to be slightly lower than the previous year. If production continues with the current fiscal year trends, the Company anticipates that actual production of sugar and co-products, at best, will meet forecasted numbers, resulting in little chance for increases in the current estimated beet payment; and if the forecasted production numbers are not met, then there is a potential for a slight decrease in beet payment to growers for the 2004 crop sugarbeets.

Revenue, from the sale of sugar, co-products, yeast and finished goods inventory valuation changes, for the six months ended February 28, 2005 decreased $14.4 million from the 2004 period, a decrease of 9.8%. Revenue from the sale of finished goods decreased $1.0 million, while the change in the value of finished goods inventory decreased $13.4 million.

Revenue from the sales of sugar decreased $.7 million or .8%, reflecting a .8% decrease in volume and a comparable price for sugar.

Revenue from dried pulp and molasses sales increased $.1 million or 1.5%, reflecting a 6.7% decrease in sales volume and an 8.2% increase in the average gross selling price.

Revenue from local sales of beet tailings and pressed pulp decreased $.2 million, reflecting a 36.1% decrease in volume and a 7.5% decrease in price. The reduced sales volume is primarily due to the steam dryer operating on a more consistent basis in 2005 resulting in less excess pressed pulp to be marketed. The pressed pulp sales were at a higher price than tailings, resulting in lower pricing due to the mix of products.

Revenues from yeast sales from the Company’s subsidiary yeast production facility, Minn-Dak Yeast Company (“MDYC”) decreased $0.2 million or 6.5%, reflecting a 3.6% increase in sales volume and a 10.1% decrease in the average selling price. This increase in volume was anticipated by Sensient Sales and Service, the Company’s sales agent and minority equity partner in MDYC, in their FY 2005 marketing plan and results from added volume from existing customers. The average selling price is based upon a formula between Minn-Dak Yeast Company and Sensient whereby average selling prices to customers along with average costs of production are taken into account in establishing the price Sensient pays Minn-Dak Yeast for product. As sales volumes increase or decrease, the efficiencies of production costs will cause the formula to decrease or increase the selling price. Also, the domestic yeast industry is currently in a position of excess capacity for the marketplace resulting in downward price pressures.

The other contributing factor to the change in revenues results from the increase or decrease in finished goods inventories. The increase in the value of finished goods inventories for the six months ended February 28, 2005 amounted to $39.4 million or $13.4 million less than the increase in the value of finished goods inventories for February 29, 2004. The change in inventories was primarily due to a reduced volume of production.

In the consolidated Statement of Operations, Expenses section, production costs of sugar, co-products and yeast totaled $34.3 million, $2.8 million or 9.0% more than the prior year. The increase is mainly attributable to higher energy costs resulting from price increases and higher operations and maintenance costs associated with the crop quality when comparing the six-month period ending February 28, 2005 to the six-month period ending February 29, 2004. Marketing costs totaled $19.9 million, $5.3 million or 35.8% more than the prior year. The marketing costs were higher, as a result of an increase in the cost of purchased sugar of approximately $2.5 MM and due to the expensing of the current portion of prepaid rights to purchase additional sugar sales allocations.

In the section Distribution of Net Proceeds, payments to members for sugarbeets, net of unit retention capital, decreased $6.9 million or 10.6%. For fiscal year 2005 the Company is projecting a payment to growers for sugarbeets totaling $80.9 million, which is $21.2 million or 20.8% less than the prior fiscal year. The decrease in payments to members is due to: (1) the result of a 1.45% increase in tons of beets delivered by members versus the prior year, (2) 10.9% less sugar per ton of the beets delivered versus the prior year, and (3) 2.6% less net sales price on sugar sold. The payment is based upon (i) an average delivered sugar content of 16.71%, (ii) a total sugarbeet crop to process of 2.3 million tons and (iii) the Company’s projected selling price for its sugar, which is currently estimated to be slightly lower than the previous year. If production continues with the current fiscal year trends, the Company anticipates that actual production of sugar and co-products, at best, will meet forecasted numbers, resulting in little chance for increases in the current estimated beet payment; and if the forecasted production numbers are not met, then there is a potential for a slight decrease in beet payment to growers for the 2004 crop sugarbeets.

The agreements between the Company and its members regarding the delivery of sugarbeets to the Company require payment for members’ sugarbeets in several installments throughout the year. As only the final payment is made after the close of the fiscal year, the first payments to members for their sugarbeets are based upon the Company’s then-current estimates of the financial results to be obtained from processing the crop and the sale of finished products. This discussion contains a summary of the Company’s current estimates of the financial results to be obtained from the Company’s processing of the 2004 sugar beet crop. Given the nature of the estimates required in connection with the payments to members for their sugarbeets, this discussion includes forward-looking statements. These forward-looking statements are based largely upon the Company’s expectations and estimates of future events; as a result, they are subject to a variety of risks and uncertainties. Some of those estimates, such as the selling price for the Company’s products and the quantity of sugar produced from the sugar beet crop are beyond the Company’s control. The actual results experienced by the Company may differ materially from the forward-looking statements contained herein.

The Company’s members harvested 2.3 million tons of sugarbeets from the 2004 crop, the second largest crop ever delivered to the Company. Sugar content of the 2004 crop at harvest was 5.5% below the average of the five most recent years. Because of the size and quality of the crop delivered, the Company’s production of sugar from the 2004 crop sugarbeets is expected to be more than long-term averages. During September, October and November, unseasonably wet conditions caused harvest to be very difficult, resulting in 5,000 acres remaining unharvested due to the excess moisture in the fields. The remaining beets to be sliced are frozen storage beets stored in sheds and are considered to be in average storage condition. The Company’s initial beet payment estimate totals $35.02 per ton or $.123388 per harvested/bonus pound of sugar, with the final beet payment determined in October of 2005.

This forward-looking material is based on the Company’s expectations regarding the processing of the 2004 sugarbeet crop; the actual production results obtained by processing those sugarbeets could differ materially from the Company’s current estimate as a result of factors such as changes in production efficiencies and storage conditions for the Company’s sugarbeets.

If production continues with the current fiscal year trends, the Company anticipates that actual production of sugar and co-products, at best will meet forecasted numbers, resulting in little chance for increases in the current estimated beet payment; and if the forecasted production numbers are not met, then there is a potential for a slight decrease in beet payment to growers for the 2004 crop sugarbeets.

The Company currently estimates the average net selling price of the Company’s sugar will be less than that of the prior year because of the volume available for sale (domestic production plus foreign imports) relative to the amount of estimated domestic consumption.

The 2002 Farm Bill contains marketing allocations for sugar that could potentially restrict the company’s ability to market all the sugar it produces. The Company believes it has obtained the allocations necessary for the marketing of substantially all of the 2004-crop. However, there are no assurances that the Company will be able to secure enough marketing allocations for crop years 2005-2007 (the crop years covered by the current Farm Bill) to market all of the production from the those crops. For each crop year left under the Farm Bill, the Company’s Board of Directors and Management team will be assessing the level of anticipated allocations that the Company will be receiving from the United States Department of Agriculture (“USDA”). Based upon that estimated level of assessment, the measurement of the risk involved in trying to secure additional allocation from other sugar processors, if needed, and the value of selling non-allocation sugar into other markets, will ultimately determine the level of planted acreage that the Company decides upon. For the 2005 crop season, the Board of Directors of the Company has announced that the allowed planted acres will be the same as the prior year.

Provisions of the current Farm Bill and existing trade agreements between the United States (“U.S.”) and various foreign countries regulate domestic and imported sugar sales in the U.S. Currently, imports provide about 12% of the total domestic consumption of sugar in the U.S., and it is the opinion of the Company and the sugar industry as a whole that any significant increase in the amount of imported sugar to the U.S. marketplace will result in serious adverse sugar pricing consequences. The Company believes that, should the U.S. Congress pass certain proposed regional or bi-lateral trade agreements that have been or are currently being negotiated, those trade agreements will represent a serious public policy challenge to itself and the domestic sugar industry. The primary agreements under consideration, to the Company’s knowledge, are the Free Trade Area of the Americas; the Central American Free Trade Agreement; the Andean Free Trade Agreement; the Thailand Free Trade Agreement; and the South African Customs Union Free Trade Agreement. Many of the countries included in these agreements are major sugar producers and exporters. If increases in guaranteed access or reductions in sugar tariffs are included in these agreements, excess sugar from these regions could enter the U.S. market and put pressure on domestic sugar prices. The U.S. sugar industry and the Company recognize the potential negative impact that would result if these agreements are entered into by the United States and are taking steps to actively oppose any agreement that calls for additional sugar access to domestic market place. The Company and the sugar industry intend to continue to focus significant attention on trade issues in the future.

The current Farm Bill provides price support provisions for sugar. However, if that price support program, including the Tariff Rate Quota system for imported sugar, were eliminated in its entirety, or if the protection the United States’ price support program provides from foreign competitors were materially reduced, the Company could be materially and adversely effected. In such a situation, if the Company were not able to adopt strategies that would allow it to compete effectively in a greatly changed domestic market for sugar, the adverse affects could impact the Company’s continued viability and the desirability of grower sugarbeets for delivery to the Company.

The Company has been notified under new National Emission Standards for Hazardous Air Pollutants for Industrial Commercial and Institutional Boilers and Process Heaters Rules finalized 9-13-04, the Company is listed as a major source of hazardous air pollutants. The company has three years to come into compliance with these regulations. At this time the Company does not anticipate the associated costs will have a material impact on its cost structure.

The Company’s Audit Committee and management are working toward meeting all required SEC documentation, certification and best business practices as required by federal legislation (the Sarbanes Oxley law). As the SEC adopts new rules and proposes future rules, the Company is positioning itself to continue being in compliance. The Company’s Audit Committee and management have been seeking guidance from the SEC and experts in the appropriate areas as needed.

The Company considers its Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer to be its disclosure committee, responsible to the Audit Committee for presenting material facts relative to the financial statements and how they are to be disclosed in the SEC filings prior to those filings.

Within the 90 days prior to the date of this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information required to be included in the Company’s periodic SEC filings relating to the Company (including its consolidated subsidiary).

There were no significant changes in the Company’s internal controls or in other factors that could significantly affect these internal controls subsequent to the date of our most recent evaluation.

Because the Company operates as a cooperative, payment for member-delivered sugarbeets, the principal raw material used in producing the sugar and agri-products it sells, are subordinated to all member business expenses. In addition, actual cash payments to members are spread over a period of approximately one year following delivery of sugarbeet crops to the Company and are net of unit retains and patronage allocated to them, all three of which remain available to meet the Company’s capital requirements. This member financing arrangement may result in an additional source of liquidity and reduced outside financing requirements in comparison to a similar business operated on a non-cooperative basis. However, because sugar is sold throughout the year (while sugarbeets are processed primarily between September and April) and because substantial amounts of equipment are required for its operations, the Company has utilized substantial outside financing on both a seasonal and long-term basis to fund such operations. The financing has been provided by Co-Bank (the “Bank”). The Company has a short-term line of credit with the Bank for calendar years 2004 and 2005 of $45.0 million, of which $1.0 million is currently available for a letter of credit. The seasonal line of credit is scheduled for renewal in May 2005.

The loan agreements between the Bank and the Company obligate the company to maintain the following financial covenants, and in accordance with GAAP:

As of February 28, 2005 the Company was in compliance with its loan agreement covenants with the Bank.

Working Capital as of February 28, 2005 totals $25.8 million compared to $14.6 million at August 31, 2004, an increase of $11.2 million for the period. Increased working capital is a result of normal financing, operational and capital expenditure activities of the Company. After the conclusion of the sugar production campaign, normally ending in the third quarter, the Company has ongoing operations and maintenance expenses without the benefit of offsetting production, thereby, when combined with capital expenditures, which are heavier during the 3^rd and 4^th quarters, and equity revolvements, working capital is drawn back down to fiscal year end projections.

The targeted working capital for August 31, 2005 is approximately $12.6 million dollars and, in the Company’s opinion, will be attained.

The primary factor for the changes in the Company’s financial condition for the six months ended February 28, 2005 was due to the seasonal needs of the 2004/2005 sugarbeet-processing season. The cash used to provide for operations of $31.6 million and investing activities of $1.3 million was funded through financing activities of $33.1 million. The net cash provided through financing activities of $33.1 million was primarily provided through proceeds from short-term debt of $36.8 million; offset by payment of long-term debt and financing fees of $3.7 million.

Contractual Obligations	Total			Less Than 1 Year			1 – 3 Years			4 –5 Years			After 5 Years
Long-Term Debt	$	25.9	MM	$	3.6	MM	$	14.4	MM	$	7.9	MM		0
Bonds Payable Obligations	$	21.0	MM	$	1.7	MM	$	5.7	MM	$	4.4	MM	$	9.2	MM
Operating Leases	$	3.1	MM	$	.9	MM	$	1.9	MM	$	.3	MM		0
Unconditional Purchase Obligations		0			0			0			0			0
Other Long-Term Obligations		0			0			0			0			0
Total Contractual Cash Obligations	$	50.0	MM	$	6.2	MM	$	22.2	MM	$	12.6	MM	$	9.2	MM

Capital expenditures for the six months ended February 28, 2005 totaled $1.3 million. Capital expenditures for fiscal year 2005 are currently estimated at $7.0 million.

The Company filed the following Current Reports on Form 8-K during the current fiscal year:

On October 15, 2004, the Company announced that the board of directors, following the completion of the 2004 fiscal year audit, has approved the final payment for the 2003 crop of $45.08 per ton of beets harvested (13.918882 cents per pound of sugar). The Board of Directors has also declared and allocated to shareholders of record, for the 2003 crop, non-qualified allocated patronage totaling $5,128,308 or $2.26 per ton of beets harvested.

On October 29, 2004, the Company announced that the board of directors, following the review and approval of the 2004-crop business plan, has determined that the beet payment estimate for the 2004-crop will be $35.02 per ton of harvested beets (12.338768 cents per pound of sugar).

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

North Dakota	23-7222188
(State or other jurisdiction of Incorporation or organization)	(I.R.S. Employer Identification No.)

7525 Red River Road Wahpeton, North Dakota	58075
(Address of principal executive offices)	(Zip Code)

Class of Common Stock		Outstanding at April 13, 2005
$250 Par Value		484

Date:	November 27, 2006		/s/ DAVID H. ROCHE
			David H. Roche President and Chief Executive Officer

Date:	November 27, 2006		/s/ STEVEN M. CASPERS
			Steven M. Caspers Executive Vice President and Chief Financial Officer

			MINN-DAK FARMERS COOPERATIVE
			(Registrant)