**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

Washington, D.C. 20549

**FORM 10-K**

```

                       [ X ]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                                   THE SECURITIES EXCHANGE ACT OF 1934

                                For the fiscal year ended August 31, 2001

                                                   OR

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

                                     Commission file number 2-60372
```

**Farmland Industries, Inc.**                     (Exact Name of Registrant as Specified in Its Charter)**Kansas****44-0209330**(State or Other Jurisdiction of Incorporation or Organization)            (I.R.S. Employer Identification No.)**12200 N. Ambassador Dr., Kansas City, Missouri****64163-1244**        (Address of Principal Executive Offices)                                             (Zip Code)                     Registrant's Telephone Number, Including Area Code: 816-713-7000                     Securities registered pursuant to Section 12(b) of the Act: None                     Securities registered pursuant to Section 12(g) of the Act: NoneIndicate by check mark whether the registrant  (1) has filed all reports  required to be filed by Section 13 or 15(d) of the SecuritiesExchange  Act of 1934  during the  preceding  12 months (or for such  shorter  period  that the  registrant  was  required to file suchreports), (2) has been subject to such filing requirements for the past 90 days.  Yes [ X ]  No [   ]Indicate by check mark if disclosure of delinquent  filers pursuant to Item 405 of Regulation S-K (Section  229.405 of this chapter) isnot contained herein, and will not be contained,  to the best of registrant's  knowledge, in definitive proxy or information statementsincorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  [  X  ]Farmland  Industries,  Inc. is a  cooperative.  Its voting stock can only be held by its members.  No public market for voting stock ofFarmland  Industries,  Inc. is established and it is unlikely,  in the foreseeable  future,  that a public market for such voting stockwill develop.         Documents incorporated by reference:        None=======================================================================================================================================                                                                
**PART I**
**ITEMS 1 AND 2.    BUSINESS AND PROPERTIES**
**THE COMPANY**

Farmland Industries, Inc.,founded in 1929 and formally incorporated in Kansas in 1931, is a farm supplyand a processing and marketing cooperative. Its principal executive offices areat 12200 N. Ambassador Dr., Kansas City, Missouri 64163 (telephone816-713-7000). Unless the context requires otherwise, (i) “Farmland”,“we”, “us”, or “our” refers to FarmlandIndustries, Inc. and its consolidated subsidiaries, (ii) all references to“year” or “years” are to fiscal years ended August 31,and (iii) the term “member” means (a) any voting member, (b) anyassociate member, or (c) any other person with which Farmland is a party to acurrently effective patronage refund agreement (a “patron”). See“Business and Properties - Business - Patronage Refunds and Distribution ofAnnual Earnings.” 
**Recent Developments**
During November 2001, wesold our interest in our petroleum products marketing venture, Country Energy,to Cenex Harvest States Cooperatives. Cash received from this transaction willbe used primarily for reduction of notes payable balances on our credit facilityand to prepay rent on our leased nitrogen facility at Coffeyville. As a part ofthis transaction, for an initial period of two years, we will sell all refinedproducts produced at our Coffeyville, Kansas refinery to Cenex Harvest States(approximately $750 million in 2001), thereby making Cenex Harvest States amaterial customer of Farmland. This agreement to sell all refined product toCenex Harvest States terminates if we sell the refinery. 

During October 2001, wereceived and executed a commitment letter from three financial institutions tounderwrite a new credit facility. To accommodate the due diligence necessary bythe members of this new facility, our existing Credit Facility which hadpreviously been extended through November 9, 2001, was extended to February 8,2002. The commitment letter contains certain conditions to closing that include,among other things, certain material adverse change clauses. Although managementcannot predict with certainty the outcome of future events, we anticipate theconditions to closing will be met and the financing will be accomplished priorto February 8, 2002. We anticipate that the new credit facility will be in anamount adequate to repay our existing Credit Facility as well as to refinancethe Coffeyville, Kansas nitrogen plant which is currently operated by Farmlandunder a synthetic lease agreement. 
**Membership**
Farmland operates on acooperative basis and is primarily owned by its members. Requirements formembership in the cooperative are established by the Articles of Incorporationof Farmland and by the Board of Directors. 

As of August 31, 2001,Farmland’s membership, associate membership and holders of capital creditsconsisted of approximately 2,400 cooperative associations of farmers andranchers and 8,800 pork or beef producers or associations of such producers. See“Business and Properties - Business - Patronage Refunds and Distribution ofAnnual Earnings.” 

**BUSINESS**
**General**
In terms of revenue,Farmland is one of the largest cooperatives in the United States. In 2001, wehad sales of $11.8 billion including export sales of approximately $1.7 billionto customers worldwide. Substantially all of our international sales areinvoiced and collected in U.S. Dollars. 

We conduct businessprimarily in two operating areas. First, on the input side of the agriculturalindustry, we operate as a farm supply cooperative. Second, on the output side ofthe agricultural industry, we operate as a processing and marketing cooperative. 

Our farm supply operationsconsist of three principal product divisions: crop production, petroleum, andfeed. Principal products of the crop production division are nitrogen andphosphate-based fertilizers (“plant foods”) and a complete line ofinsecticides, herbicides and mixed chemicals. Principal products of thepetroleum division are refined fuels, propane and by-products of petroleumrefining. Principal products of the feed division include swine, dairy, pet,beef, poultry, mineral and specialty feeds, feed ingredients and supplements,animal health products and livestock services. Effective October 1, 2000,substantially all of our feed operations are conducted through our equityparticipation in Land O’Lakes Farmland Feed LLC. We manufacturedapproximately 54% of the dollar value of our sales of farm supply products in2001. Approximately 57% of the farm supply products we sold in 2001 were atwholesale to farm cooperative associations which are members of Farmland, andwho, in turn, distribute these products primarily to farmers and ranchers. 

The output side of ourbusiness consists of the processing and marketing of meat and the storage andmarketing of grain. In 2001, approximately 79% of the hogs processed, 32% of thecattle processed and 59% of the domestic grain marketed by us were supplied tous by our members. Substantially all the pork and beef products we sold in 2001was processed in plants we own. Grain operations are conducted through ourwholly-owned subsidiary, Tradigrain, and through our grain marketingrelationship with ADM/Farmland, Inc. ADM/Farmland, which leases and operatesFarmland’s grain elevators throughout the United States, is a wholly-ownedsubsidiary of the Archer Daniels Midland Company (ADM). 

Our crop nutrientmanufacturing facilities sell all of their output to our 25%-owned cropprotection and crop nutrient marketing venture, Agriliance. Agriliance, in turn,sells product to numerous local cooperatives and other crop protection and cropnutrient retailers. Effective December 2001, our petroleum refinery will sellall of its output to Country Energy, a wholly-owned subsidiary of Cenex HarvestStates. Except as discussed above, no material part of the business of anysegment of Farmland is dependent on a single customer or a few customers.Financial information about our industry segments is presented in Note 15of the Notes to Consolidated Financial Statements. 

The principal businesses ofFarmland have been highly seasonal. Historically, the majority of sales of cropproduction products occur in the spring. Demand for refined petroleum fuelshistorically have been concentrated in the summer, and summer is the period oflowest demand for the feed business. 

Farmland competes formarket share with numerous participants of various sizes and with various levelsof vertical integration, product and geographical diversification. Competitorsin the crop production industry include global producers of nitrogen- andphosphate-based fertilizers, major chemical companies, and product importers andbrokers. In the petroleum industry, competitors include major oil companies,independent refiners, and product brokers. The feed, grain, and meats industriesare comprised of a large variety of competitive participants. 
**Business Risk Factors**