# UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

# FORM 10-Q

# [X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended:   February 28, 2005

OR

# [   ]     TRANSITION REPORT PURSUANT TO SECTION 13 AND 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Commission file: No. 33-94644

MINN-DAK FARMERS COOPERATIVE
(Exact named of registrant as specified in its charter)

|North Dakota                    |  | 23-7222188          | 
|------------------------------- |  | ------------------- | 
|                                |  |                     | 
|(State or other jurisdiction of |  | (I.R.S. Employer    | 
|Incorporation or organization)  |  | Identification No.) | 
|7525 Red River Road             | 
|Wahpeton, North Dakota          |  | 58075               | 
|                                |  |                     | 
|(Address of principal           |  | (Zip Code)          | 
|executive offices)              | 

| | (701) 642-8411                                                                    | 
| | --------------------------------------------------------------------------------- | 
| |                                                                                   | 
| | (Registrants telephone number, including area code)                              | 
| | Not Applicable                                                                    | 
| |                                                                                   | 
| | (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.

YES   ____X____                         
NO   __________

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

YES   _________                         
NO   ____X____

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

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

---

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.

---

MINN-DAK FARMERS
COOPERATIVE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

|1. | The consolidated financial statements for the six-month periods ended February
          28, 2005 and February 29, 2004 are unaudited and reflect all adjustments
          (consisting only of normal recurring adjustments) which are, in the opinion of
          management, necessary for a fair presentation of the financial position and
          operating results for the interim period. The condensed consolidated financial
          statements should be read in conjunction with the consolidated financial
          statements and notes thereto, together with managements discussion and
          analysis of financial condition and results of operations, contained in the
          Companys Annual Report to Stockholders previously submitted in the
          Companys Annual 10-K for the fiscal year ended August 31, 2004. The
          results of operations for the six months ended February 28, 2005 are not
          necessarily indicative of the results for the entire fiscal year ending August
          31, 2005.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | In August 2004, the company declared a revolvement of the remaining 25% of the
          unit retains and allocated patronage for the 1993 crop totaling $828,628, 100%
          of the 1994 crop totaling $3,475,805 and approximately 8% of the 1995 crop unit
          retains and allocated patronage totaling $213,271. These amounts were paid to
          the stockholders on September 30, 2004.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | In October 2004, the company allocated to members $5,128,308 of patronage from
          the 2003 crop, of which $4,328,308 was in the form of non-qualified allocated
          patronage and $800,000 was in the form of qualified allocated patronage.
          $4,000,000 of the allocated patronage was declared qualified for alternative
          minimum tax purposes. On November 12, 2004 $800,000 was paid in cash to the
          stockholders and a notice was given for the alternative minimum tax qualified
          declaration.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | The Financial Accounting Standards Board has issued an amendment to Financial
          Accounting Standards No. 132, Employers Disclosure about Pensions and
          Other Postretirement Benefits. Such amendment requires additional disclosures to
          interim and annual financial statements, which are effective for the interim
          period ending February 28, 2005, but does not change the recognition
          requirements related to pensions and postretirement benefits.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Components
of Net Periodic Benefit Cost for the Six Months Ended 2-28-05

|000's                              | Pension Benefits |  | Other Benefits
|---------------------------------- | ---------------- |  | --------------
|
|                                   |                  |  |               
|Service Cost                       |                  |  | $             
|Interest Cost                      |                  |  |               
|Expected return on plan assets     |                  |  |               
|Amortization of prior service cost |                  |  |               
|Amortization of transition cost    |                  |  |               
|Amortization of net (gain) loss    |                  |  |               
|Net periodic benefit cost          |                  |  | $             

| | 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.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



---

# MINN-DAK FARMERS COOPERATIVE 
CONSOLIDATED BALANCE SHEETS
ASSETS
(In Thousands)

|ASSETS                                                    | Feb 28, 2005
(Unaudited) |  | Aug 31, 2004
(Audited)
|--------------------------------------------------------- | ------------------------ |  | ----------------------
|                                                          |                          |  |                       
|CURRENT ASSETS:                                           |                          |  |                       
|Cash                                                      |                          |  | $                     
|                                                          |                          |  |                       
|Receivables:                                              |                          | 
|Trade accounts                                            |                          |  |                       
|Growers                                                   |                          |  |                       
|Other                                                     |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|Advances to affiliate                                     |                          |  |                       
|                                                          |                          |  |                       
|Inventories:                                              |                          | 
|Refined sugar, pulp and molasses to be sold               |                          | 
|on a pooled basis                                         |                          |  |                       
|Nonmember refined sugar                                   |                          |  |                       
|Yeast                                                     |                          |  |                       
|Materials and supplies                                    |                          |  |                       
|Beet and Juice Inventory                                  |                          |  |                       
|Other Inventory                                           |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|Deferred charges                                          |                          |  |                       
|                                                          |                          |  |                       
|Prepaid expenses                                          |                          |  |                       
|                                                          |                          |  |                       
|Other                                                     |                          |  |                       
|                                                          |                          |  |                       
|Current deferred income tax asset                         |                          |  |                       
|                                                          |                          |  |                       
|Total current assets                                      |                          |  |                       
|                                                          |                          |  |                       
|PROPERTY, PLANT AND EQUIPMENT:                            |                          | 
|Land and land improvements                                |                          |  |                       
|Buildings                                                 |                          |  |                       
|Factory equipment                                         |                          |  |                       
|Other equipment                                           |                          |  |                       
|Construction in progress                                  |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|Less accumulated depreciation                             |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|OTHER ASSETS:                                             |                          | 
|Investments restricted for capital lease projects         |                          |  |                       
|Investment in stock of other corporations, unconsolidated |                          | 
|marketing subsidiaries and other cooperatives             |                          |  |                       
|Other                                                     |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|                                                          |                          |  |                       
|See Notes to Consolidated Financial Statements.           |                          |  | $                     
|                                                          |                          |  |                       



---

# MINN-DAK FARMERS COOPERATIVE
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS EQUITY
(In Thousands)

|                                                     |  | Feb 28, 2005
(Unaudited) |   | Aug 31, 2004
(Audited)
|---------------------------------------------------- |  | ------------------------ | - | ----------------------
|                                                     |  |                          |   |                       
|LIABILITIES AND MEMBERS INVESTMENT                  |  |                          |   |                       
|                                                     |  |                          |  
|CURRENT LIABILITIES:                                 |  |                          |   |                       
|Short-term notes payable                             |  |                          | $ | 46,975                
|                                                     |  |                          |   |                       
|Current portion of long-term debt                    |  |                          |   | 3,600                 
|Current portion of bonds payable                     |  |                          |   | 1,725                 
|                                                     |  |                          |   |                       
|                                                     |  |                          |   | 5,325                 
|Accounts payable:                                    |  |                         
|Trade                                                |  |                          |   | 1,503                 
|Growers                                              |  |                          |   | 27,446                
|                                                     |  |                          |   |                       
|                                                     |  |                          |   | 28,949                
|                                                     |  |                          |   |                       
|Accrued liabilities                                  |  |                          |   | 4,645                 
|                                                     |  |                          |   |                       
|Total current liabilities                            |  |                          |   | 85,894                
|                                                    
|LONG-TERM DEBT, NET OF CURRENT PORTION               |  |                          |   | 22,300                
|                                                    
|BONDS PAYABLE                                        |  |                          |   | 19,230                
|                                                    
|LONG TERM DEFERRED TAX LIABILITY                     |  |                          |   | 1,242                 
|                                                    
|OTHER                                                |  |                          |   | 612                   
|                                                    
|COMMITTMENTS AND CONTINGENCIES                       |  |                          |   |                      
|                                                     |  |                          |   |                       
|Total liabilities                                    |  |                          |   | 129,278               
|                                                     |  |                          |   |                       
|MINORITY INTEREST IN EQUITY OF SUBSIDIARY            |  |                          |   | 1,910                 
|                                                     |  |                          |   |                       
|MEMBERS INVESTMENT:                                 |  |                         
|Preferred stock:                                     |  |                         
|Class A - 100,000 shares authorized, $105 par value; |  |                         
|72,200 shares issued and outstanding                 |  |                          |   | 7,581                 
|Class B - 100,000 shares authorized, $75 par value;  |  |                         
|72,200 shares issued and outstanding                 |  |                          |   | 5,415                 
|Class C - 100,000 shares authorized, $76 par value;  |  |                         
|72,200 shares issued and outstanding                 |  |                          |   | 5,487                 
|                                                     |  |                          |   |                       
|                                                     |  |                          |   | 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                   
|Paid in capital in excess of par value               |  |                          |   | 32,094                
|Unit retention capital                               |  |                          |   | 3,042                 
|Qualified allocated patronage                        |  |                          |   | 1,634                 
|Nonqualified allocated patronage                     |  |                          |   | 28,103                
|Retained earnings (deficit)                          |  |                          |   | 6,659                 
|                                                     |  |                          |   |                       
|                                                     |  |                          |   | 90,136                
|                                                     |  |                          |   |                       
|See Notes to Consolidated Financial Statements.      |  |                          | $ | 221,324               
|                                                     |  |                          |   |                       



---

PART I. FINANCIAL INFORMATION ITEM
1.CONSOLIDATED FINANCIAL STATEMENTS

# MINN-DAK FARMERS COOPERATIVE
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands)
(Unaudited)

|                                                     | Three Months Ended
February 28, |  | Six Months Ended
February 28,
|---------------------------------------------------- | ------------------------------- |  | -----------------------------
|                                                     |                                 |  |                              
|
|                                                     |                                 |  |                              
|REVENUE:                                             |                                 |  |                              
|From sales of sugar, co-products, and                |                                 | 
|yeast, net of discounts                              |                                 |  | $                            
|Other income                                         |                                 |  |                              
|                                                     |                                 |  |                              
|                                                     |                                 |  |                              
|                                                     |                                 |  |                              
|EXPENSES:                                            |                                 | 
|Production costs of sugar, co-products,              |                                 | 
|and yeast sold                                       |                                 |  |                              
|Marketing (includes freight and storage)             |                                 |  |                              
|General and administrative                           |                                 |  |                              
|Interest                                             |                                 |  |                              
|(Gain) loss on disposition of property and equipment |                                 |  |                              
|                                                     |                                 |  |                              
|                                                     |                                 |  |                              
|                                                     |                                 |  |                              
|NET PROCEEDS RESULTING FROM MEMBER AND               |                                 | 
|NONMEMBER BUSINESS                                   |                                 |  | $                            
|                                                     |                                 |  |                              
|DISTRIBUTION OF NET PROCEEDS:                        |                                 | 
|Credited to members' investment:                     |                                 | 
|Components of net income:                            |                                 | 
|Income (loss) from non-member business               |                                 |  | $                            
|Patronage income                                     |                                 |  |                              
|                                                     |                                 |  |                              
|Net income                                           |                                 |  |                              
|Unit retention capital                               |                                 |  |                              
|                                                     |                                 |  |                              
|Net credit to members' investment                    |                                 |  |                              
|                                                    
|Payments to members for sugarbeets, net of unit      |                                 | 
|retention capital                                    |                                 |  |                              
|                                                     |                                 |  |                              
|NET PROCEEDS RESULTING FROM MEMBER AND               |                                 | 
|NONMEMBER BUSINESS                                   |                                 |  | $                            
|                                                     |                                 |  |                              

|See Notes to Consolidated Financial Statements.
|-----------------------------------------------



---

# MINN-DAK FARMERS COOPERATIVE
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)

|                                                                | Six Months Ended
February 28,
|--------------------------------------------------------------- | -----------------------------
|
|                                                                |                              
|CASH FLOWS FROM OPERATING ACTIVITIES:                           |                              
|Income allocated to members' investment                         |                              
|Add (deduct) noncash items:                                     |                              
|Depreciation and amortization                                   |                              
|Net income allocated from unconsolidated marketing subsidiaries |                              
|Minority interest in equity of subsidiaries                     |                              
|Changes in operating assets and liabilities:                    |                              
|Accounts receivable and advances                                |                              
|Inventory and prepaid expenses                                  |                              
|Deferred charges and other assets                               |                              
|Accounts payable, accrued liabilities and other liabilities     |                              
|                                                                |                              
|Net cash used in operating activities                           |                              
|                                                               
|CASH FLOWS FROM INVESTING ACTIVITIES:                           |                              
|Capital expenditures                                            |                              
|Net proceeds from patronage refunds and equity revolvements     |                              
|Issuance of notes receivable                                    |                              
|Restricted bond fund investment                                 |                              
|                                                                |                              
|Net cash used in investing activities                           |                              
|                                                                |                              
|CASH FLOWS FROM FINANCING ACTIVITIES:                           |                              
|Net proceeds from issuance of short-term debt                   |                              
|Payment of long-term debt                                       |                              
|Payment of financing fees                                       |                              
|Payment of unit retains and allocated patronage                 |                              
|Sale and repurchase of common stock, net                        |                              
|                                                                |                              
|Net cash provided by financing activities                       |                              
|                                                                |                              
|                                                               
|NET DECREASE IN CASH                                            |                              
|                                                               
|CASH, BEGINNING OF YEAR                                         |                              
|                                                                |                              
|CASH, END OF QUARTER                                            |                              
|                                                                |                              
|SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:              |                              
|Cash payments for:                                              |                              
|Interest                                                        |                              
|                                                                |                              
|Income taxes, net of refunds                                    |                              
|                                                                |                              

|See Notes to Consolidated Financial Statements.
|-----------------------------------------------



---

MANAGEMENTS
DISCUSSION AND ANALYSIS

OF THE RESULTS OF
OPERATIONS AND FINANCIAL CONDITION

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.

RESULTS FROM OPERATIONS

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

Revenue for the three months ended
February 28, 2005 decreased $5.2 million from the 2004 period, a decrease of 7.7%. Revenue
from the sale of finished goods decreased $1.2 million and the change in the value of
inventories decreased $4.0 million.

Revenue from the sales of sugar
decreased $1.1, or 2.6% reflecting a 2.9% decrease in volume and a .2% 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 $16.0 million or $4.0 million less than the increase in the value of finished
goods inventories for February 29, 2004.



---

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.

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

Revenue, from the sale of sugar,
co-products, yeast and finished goods inventory valuation changes, for the six months
ended February 28, 2005 decreased $4.6 million from the 2004 period, a decrease of 3.6%.
Revenue from the sale of finished goods decreased $1.0 million, while the change in the
value of finished goods inventory decreased $3.6 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 $30.9 million or $3.7 million less than the increase in the value of
finished goods inventories for February 29, 2004.

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.

ESTIMATED FISCAL YEAR
2005 INFORMATION

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.

OTHER INFORMATION

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.



---

LIQUIDITY AND CAPITAL
RESOURCES

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:

- Maintain working capital of not less than $9.0 million as of August 31, 2005.
- Maintain a long-term debt and capitalized leases to equity ratio of not greater than .8:1.
- Maintain available cash flow to current long-term debt ratio as defined in the agreement of not less than
1.25:1.

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 $21.2 million compared to $14.6 million at August 31, 2004, an increase of
$6.6 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 3rd and
4th 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                     |       |  | $                | 25.9MM |             | $ | 3.6MM      |  | $            
|Bonds Payable Obligations          |       |  | $                | 21.0MM |             | $ | 1.7MM      |  | $            
|Operating Leases                   |       |  | $                | 3.1MM  |             | $ | .9MM       |  | $            
|Unconditional Purchase Obligations |       |  |                  | 0      |             |   | 0          |  |              
|Other Long-Term Obligations        |       |  |                  | 0      |             |   | 0          |  |              
|Total Contractual Cash Obligations |       |  | $                | 50.0MM |             | $ | 6.2MM      |  | $            
|                                   |       |  |                  |        |            

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.



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PART II. OTHER INFORMATION

Item 1. Legal ProceedingsNone

Item 2. Changes in
SecuritiesNone

Item 3. Defaults upon
Senior SecuritiesNone

Item 4. Submission of Matters
to a Vote of Security HoldersNone

Item 5. Other InformationNone

Item 6. Exhibits and
Reports on Form 8-K

|a) | Exhibits | Item #31.1 | Section 302 Certification of the President & Chief
               Executive Officer
|-- | -------- | ---------- | -----------------------------------------------------------------------------------

| |  | Item #31.2 | Section 302 Certification of the Executive Vice President & Chief Financial Officer
| |  | ---------- | -----------------------------------------------------------------------------------

| |  | Item #31.3 | Section 302 Certification of the Controller & Chief Accounting Officer
| |  | ---------- | ----------------------------------------------------------------------

| |  | Item #32.1 | Section 906 Certification of the Chief Executive Officer and Chief Financial Officer
| |  | ---------- | ------------------------------------------------------------------------------------

|b) | Reports on Form 8-K
|-- | -------------------

| | 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).



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SIGNATURES

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.

|                     | MINN-DAK FARMERS COOPERATIVE                                                                                                                         
|-------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------
|                     |                                                                                                                                                      
|                     | (Registrant)                                                                                                                                         
|Date: April 14, 2005 | /s/ DAVID H. ROCHE                                                                                                                                   
|                     |                                                                                                                                                      
|                     | David H. Roche
                                                                               President and Chief Executive Officer                  
|Date: April 14, 2005 | /s/ STEVEN M. CASPERS                                                                                                                                
|                     |                                                                                                                                                      
|                     | Steven M. Caspers
                                                                               Executive Vice President and Chief Financial Officer