Johnson, John D. 1949–
John D. Johnson
President and chief executive officer, CHS
Born: September 24, 1949, in Rhame, North Dakota.
Education: Black Hills State University, BBA, 1970.
Family: Married Shirley (maiden name unknown); children: three.
Career: Western Electric, 1970–1974, production supervisor; ConAgra, 1974–1976, feed salesman; Farmers Union Grain Terminal Association, 1976–1981, feed consultant; 1981–1986, regional sales manager; 1986–1989, director of sales; 1989–1992, vice president and general manager, GTA Feeds; Harvest States Cooperatives, 1992–1994, vice president, farm marketing and supply division; 1994–1998, president and chief executive officer; Cenex Harvest States Cooperatives (later CHS), 1998–2000, president and general manager; 2000–, president and chief executive officer.
Address: CHS, 5500 Cenex Drive, Inver Grove Heights, Minnesota 55077; http://www.chsinc.com.
■ John D. Johnson rose through the ranks from the position of feed consultant to president and CEO of Cenex Harvest States Cooperatives, later known as CHS, one of the largest agricultural cooperatives in the United States. Johnson led CHS and its predecessors through several difficult financial periods and helped the cooperative maintain its status as a Fortune 500 company. Johnson's experience in marketing helped CHS to increase returns to farmers and ranchers by exploring new means of linking these food producers to customers.
FROM THE FARM TO MARKETING
Beginning in his childhood, Johnson invested his life in agriculture. He was born in 1949 in Rhame, North Dakota, where members of his family operated a wheat farm and cattle ranch. He grew up in Spearfish, South Dakota, and attended Black Hills State University in Spearfish, in 1970 earning his bachelor's degree in business administration with a minor in economics. Early in his career, Johnson worked as a production supervisor for Western Electric Company and as a livestock feed salesman for ConAgra.
RISING THROUGH THE RANKS AT GTA
In 1976 Johnson accepted a position as a feed consultant for the former Farmers Union Grain Terminal Association (GTA). GTA was one of several individual cooperatives operating in the Midwest and Northwest. By the 1970s agricultural cooperatives and the farming industry had experienced a period of expansion. GTA, along with other cooperatives such as Cenex (formerly Farmers Union Central Exchange) and North Pacific Grain Growers, began to grow by acquiring local cooperatives.
Johnson quickly rose through the ranks of GTA, progressing to the position of regional sales manager and, later, director of sales of GTA Feeds. Early in Johnson's career, GTA acquired the Wisconsin-based Holsum Foods, which produced processed foods. This acquisition proved important during the 1980s, when the farming industry suffered heavy losses and several large cooperatives filed for bankruptcy or consolidated with other cooperatives. In 1983 GTA merged with North Pacific Grain Growers to form Harvest States Cooperatives. By the mid-1980s Harvest States had the highest revenues among cooperatives in the Midwest. In 1989 Johnson was appointed to the position of vice president and general manager of GTA.
APPOINTED PRESIDENT OF HARVEST STATES
Harvest States survived the turmoil of the 1980s and was producing record distributions to its members by the early 1990s. Johnson's meteoric rise continued in 1992, when he was promoted to group vice president for the farm marketing and supply division of Harvest States. In 1994 Johnson was named to succeed Allen D. Hanson as CEO of Harvest States by the end of that year. Johnson's background in marketing represented a significant change in direction from the philosophy of the cooperative's three previous chief executives, each of whom had a background in grain merchandising. When Johnson was named president at Harvest States, the cooperative provided grain marketing and related services to approximately five hundred member cooperatives representing 125,000 producer-growers in the Midwest and Northwest. The cooperative built flour mills in Wisconsin, Texas, and Pennsylvania during the mid-1990s.
Harvest States continued its growth under Johnson's direction. In Johnson's first year as president of Harvest States, the cooperative announced that it was trying to find new ways for farmers to invest in their processing plants. According to Johnson, farmers at that time had turned to smaller cooperatives with closed memberships because these farmers believed that they had a greater sense of ownership. Johnson maintained, however, as reported in The Bismarck Tribune, that the smaller cooperatives had "a tendency toward over-promising and under-delivering" (December 14, 1995). During the mid-1990s Johnson was optimistic about world demand for agricultural products, and he continued to be so for the rest of the decade. According to Johnson, the United States had the infrastructure, technology, and information resources that could take advantage of this demand.
HARVEST STATES MERGES WITH CENEX
In 1997 Cenex and Harvest States announced that the two cooperatives had agreed to explore the possibility of a partnership or merger. Noel Estenson, then the president and CEO of Cenex, said that the potential merger could strengthen the positions of the members of the two cooperatives and create greater operational efficiencies. Johnson agreed, noting in the announcement, as reported by Dee Depass in the Minneapolis–Saint Paul Star-Tribune, "We have an opportunity to build a system that extends all the way from inputs on the producer side to domestic and global food markets. All the components are there. We will be looking for ways to put them together in a way that best serves our procedure and local cooperative members" (October 7, 1997).
At the time of the proposed merger Harvest States had six hundred local cooperative members, representing approximately 38,000 direct farmer members and 2,350 employees. Cenex, on the other hand, had 1,400 local cooperative members and employed approximately 2,500 persons. Cenex, which was based in Inver Grove Heights, Minnesota, sold plant food, petroleum, lubricants, tires, and crop production products. The possible merger of the two large cooperatives would, according to a Harvest States spokesperson as reported by Depass, "serve the farmer all the way from providing him with the fertilizer he needs on the farm and petroleum all the way to marketing his product through the co-op system and even processing it" (October 7, 1997).
The merger between Cenex and Harvest States became official on June 1, 1998. Johnson was named president and general manager, and Estenson served as the cooperative's CEO. In 1998 the two cooperatives had combined revenues of $8.8 billion, although both cooperatives had suffered losses in the previous year. In 1997 Harvest States under Johnson's leadership experienced a 22 percent decline in revenue as the result of reduced grain prices and volume. Nevertheless, Johnson remained bullish about the merged cooperative's ability to compete with larger rivals.
LEADING CONTINUED DOMESTIC AND INTERNATIONAL GROWTH
As president of Cenex Harvest States Johnson led the cooperative through continued periods of growth and expansion. Soon after the merger in 1998 the cooperative announced that it would enter into a joint venture with United Grain Corporation, a subsidiary of Japan-based Mitsui & Company, and Mitsui USA. The venture joined Cenex's wheat and barley operations in the western United States with those of United Grain Corporation. In 1999 Cenex Harvest States agreed to acquire Sparta Foods, a regional market leader in the production and distribution of tortillas. Johnson had served as a member of the Sparta board of directors since 1998.
The merger with Sparta came at a time when Cenex Harvest States had suffered financial difficulties. In 1999 the cooperative's income fell 51 percent to $86 million. Johnson remained committed to increasing returns. In an interview with Ann Merrill of the Star-Tribune, Johnson said, "With the markets being like they are, at record lows, the only way farms can get better value for their production is by investing themselves further into the food chain" (January 16, 2000). Johnson said that Cenex Harvest States would continue to look at new opportunities to acquire companies, form partnerships, or construct new facilities in an effort to maximize the returns given to its members.
NAMED PRESIDENT AND CEO OF CENEX HARVEST STATES
When Estenson retired in 2000, Cenex Harvest States announced that Johnson would assume the position of president and CEO. Steven Burnet, the chairman of the board of Cenex, said for a press release, "John Johnson's experience spans from the farm gate to the international arena. Under his leadership, we will continue to build Cenex Harvest States into an organization that returns value to farmers and rangers by finding new ways to link them to the consumer" (May 3, 2000).
Johnson continued to identify new opportunities. For the May 3, 2000, press release, Johnson said, "Producer-owned co-ops like Cenex Harvest States are uniquely positioned to respond to the evolving marketplace, especially changing consumer demands for food that have special health or convenience characteristics." Between 2000 and 2004 Cenex Harvest States, the name of which was abbreviated to CHS in 2003, continued to build new facilities and to acquire interest in other companies and cooperatives. In 2003 CHS had an annual revenue of nearly $9.4 billion, an increase of 19.8 percent from the previous year. Johnson served on the boards of several companies and associations, including Ventura Foods, the National Cooperative Refinery Association, and Rooster.com, an online agricultural network.
See also entry on CHS Inc. in International Directory of Company Histories.
sources for further information
"Briefly," The Bismarck Tribune, December 14, 1995.
"Cenex Harvest States Names New CEO," Associated Press Newswires, May 4, 2000.
Depass, Dee, "Farm Co-ops Might Unite," Star-Tribune, October 7, 1997.
"Johnson to Succeed Estenson as Cenex Harvest States CEO," May 3, 2000, http://www.chsinc.com/go.asp?Page=122&Template=02&Get=article_000985826.
Levy, Melissa, "Cenex Says It's Ready to Compete," StarTribune, December 11, 1998.
Merrill, Ann, "Merger Shows Cenex Harvest States Is Hungry for Growth," Star-Tribune, January 16, 2000.
—Matthew C. Cordon