South Dakota Soybean Processors Reports $10.8M Net Income in Q3 2025

South Dakota Soybean Processors, LLC (SDSP) reported its financial results for the third quarter and nine-month period ending September 30, 2025, revealing a net income of $10.8 million for the quarter, a significant increase from $23,000 in the same period last year. For the nine months, net income attributable to the company rose to $14.2 million, compared to $11.5 million in 2024. Revenue for the third quarter was $129.8 million, a slight decrease of 0.6% from $130.6 million in the prior year, while year-to-date revenue fell 16.4% to $358.4 million from $428.6 million in 2024. The decline in revenue was primarily attributed to lower average sales prices for soybean products, particularly soybean meal and oil, which were affected by increased U.S. soybean crushing capacity and reduced demand from the biofuels sector.

The company experienced a notable increase in gross profit for the third quarter, which rose to $13.8 million, up from $2.3 million in the same period last year. This increase was largely driven by an $8.3 million net gain from derivative activities, contrasting with a loss of $3.8 million in the previous year. Operating expenses also increased, reflecting higher administrative costs associated with the startup of the High Plains Processing plant, which is nearing completion and has begun operational testing. Interest expenses decreased by 25% to $1.2 million, attributed to reduced borrowings and capitalized interest related to the plant's construction.

In terms of operational developments, SDSP's processing volume increased by approximately 15.9% in the third quarter compared to the same period in 2024, primarily due to improvements made during an extended shutdown for equipment upgrades at the Volga facility. The company reported a working capital of approximately $34.2 million as of September 30, 2025, down from $59.1 million a year earlier, largely due to expenditures related to the High Plains Processing plant. The plant is expected to contribute to revenues in the fourth quarter of 2025, although actual sales volumes may vary as operations stabilize.

The company’s total assets increased to $727.1 million as of September 30, 2025, compared to $541.9 million at the end of 2024, driven by significant investments in property and equipment, particularly for the new processing facility. Long-term debt rose sharply to $216.3 million from $57.7 million, reflecting the financing of the plant's construction. SDSP maintains various credit facilities, including a revolving credit agreement with a maximum borrowing capacity of $70 million, which remains available for operational needs.

Looking ahead, SDSP anticipates that the soybean crop harvested in September 2025 will yield record levels, with favorable oil, protein, and moisture content. While processing margins are expected to remain profitable in the fourth quarter, the company faces ongoing uncertainty regarding federal biofuels policy, which could impact profitability into 2026. The management remains cautious, emphasizing the need for clarity in market conditions as they navigate the evolving landscape of the agricultural sector.