UNITED STATESSECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________________________ FORM
10-K _________________________ S
Annual
report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934.For the fiscal year ended December 31,
2008£
Transition
report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934.Commission file number
000-50733  UNITED WISCONSIN GRAIN PRODUCERS, LLC(Exact name of registrant as specified
in its charter)Wisconsin

39-2032455(State or other jurisdiction
ofincorporation or organization)

(I.R.S. Employer Identification
No.)W1231
Tessmann Drive, Friesland, Wisconsin
                                          53935-0247(Address
of principal executive offices)
                                                    (Zip
Code)(920) 348-5016(Registrants telephone
number)Securities registered pursuant to
Section 12(b) of the Act:NoneSecurities registered pursuant to
Section 12(g) of the Act:Membership
Units  Indicate by check mark if the registrant is
a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
 £  Yes
   S  No  Indicate by check mark if the registrant is
not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
 £  Yes
   S  No  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 (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
   S  Yes
   £  No  Indicate by check mark if disclosure of
delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this
chapter) is not contained herein, and will not be contained, to the best of
registrants knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. S   Indicate by
check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company.  See the
definitions of large accelerated filer, accelerated filer and smaller
reporting company in Rule 12b-2 of the Exchange Act: Large accelerated filer £ Accelerated filer £  Non-accelerated filer S Smaller reporting
company £  Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Act). £Yes SNo  The aggregate market value of the
membership units held by non-affiliates of the registrant at December 31,
2008, was $23,735,000.  There is no established public trading market for
our membership units.  The aggregate market value was computed by reference
to the price at which membership units were last sold by the registrant
($1,000.00 per unit).  As of March 1, 2009, there were 28,475
membership units outstanding.  DOCUMENTS INCORPORATED BY REFERENCE  The registrant has incorporated by
reference into Part III of this Annual Report on Form 10-K portions of its
definitive proxy statement to be filed with the Securities and Exchange
Commission within 120 days after the close of the fiscal year covered by this
Annual Report.  2  INDEX  Page No. PART I 6 ITEM 1. BUSINESS 6 ITEM 1A. RISK FACTORS 20 ITEM 2. PROPERTIES 26 ITEM 3. LEGAL PROCEEDINGS 26 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS 26 PART II 27 ITEM 5. MARKET FOR REGISTRANTS MEMBERSHIP UNITS, RELATED
MEMBERMATTERS AND ISSUER PURCHASES OF MEMBERSHIP UNITS 27 ITEM 6. SELECTED FINANCIAL DATA 30 ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONAND RESULTS OF OPERATIONS 30 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK 41 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA 43 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ONACCOUNTING AND FINANCIAL DISCLOSURE 62 ITEM 9A(T). CONTROLS AND PROCEDURES 62 ITEM 9B. OTHER INFORMATION 63 PART III 63 PART IV 64 ITEM 15. EXHIBITS, FINANCIAL STATEMENT
SCHEDULES 64 SIGNATURES 66   3   CAUTIONARY
STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS  This annual report
contains historical information, as well as forward-looking statements that
involve known and unknown risks and relate to future events, our future
financial performance, or our expected future operations and actions.  In
some cases, you can identify forward-looking statements by terminology such as
may, will, should, expect, plan, anticipate, believe, estimate,
future, intend, could, hope, predict, target, potential, or
continue or the negative of these terms or other similar expressions.
 These forward-looking statements are only our predictions based upon
current information and involve numerous assumptions, risks and uncertainties.
 Our actual results or actions may differ materially from these
forward-looking statements for many reasons, including the reasons described in
this report.  While it is impossible to identify all such factors, factors
that could cause actual results to differ materially from those estimated by us
include:  
Changes in the availability and price
of corn and natural gas;
The availability of credit to support
capital improvements, development, expansion and operations;
Changes in our business strategy,
capital improvements or development plans;
Results of our hedging transactions
and other risk management strategies;
Decreases in the market prices of
ethanol and distillers grains;
Ethanol supply exceeding demand; and
corresponding ethanol price reductions;
Changes in the environmental
regulations that apply to our plant operations;
Our ability to generate sufficient
liquidity to fund our operations and capital expenditures;
Changes in plant production capacity
or technical difficulties in operating the plant;
Changes in general economic
conditions or the occurrence of certain events causing an economic impact
in the agriculture, oil or automobile industries;
Lack of transport, storage and
blending infrastructure preventing ethanol from reaching high demand
markets;
Changes in federal and/or state laws
(including the elimination of any federal and/or state ethanol tax
incentives);
Changes and advances in ethanol
production technology;
Effects of mergers, consolidations or
contractions in the ethanol industry;
Competition from alternative fuel
additives;
Our liability resulting from
litigation;
Our reliance on third parties to
market our products;
The loss of, or our inability to
obtain, any license or permit;
Our ability to retain key employees
and maintain labor relations;
Volatile commodity and financial
markets; and
Other factors described elsewhere in
this report.  4    The cautionary
statements referred to in this section also should be considered in connection
with any subsequent written or oral forward-looking statements that may be
issued by us or persons acting on our behalf.  We undertake no duty to
update these forward-looking statements, even though our situation may change in
the future. Furthermore, we cannot guarantee future results, events, levels of
activity, performance, or achievements.  We caution you not to put undue
reliance on any forward-looking statements, which speak only as of the date of
this report.  You should read this report and the documents that we
reference in this report and have filed as exhibits, completely and with the
understanding that our actual future results may be materially different from
what we currently expect.  We qualify all of our forward-looking statements
by these cautionary statements.   AVAILABLE INFORMATION  Information about us is
also available at our website atwww.uwgp.com, under Company
Information -- Financial Information, which includes links to reports we have
filed with the Securities and Exchange Commission, including annual, quarterly
and current reports. The contents of our website are not incorporated by
reference in this Annual Report on Form 10-K.  5  PART I.  ITEM 1.  BUSINESS.  Business Development  References to we,
us, our and the Company refer to United Wisconsin Grain Producers, LLC.
 United Wisconsin Grain Producers, LLC was formed as a Wisconsin limited
liability company on November 2, 2001.  The Company manages the business
and day-to-day operations of an ethanol plant near Friesland, Wisconsin.
 Construction of the ethanol plant was substantially completed and
operations commenced in May 2005.  The ethanol plant was originally
constructed as a 40 million gallon per year facility.  In December 2007, we
substantially completed an expansion that increased our production capacity to
approximately 60 million gallons of ethanol per year.  We began operating
at this expanded production capacity in July 2008; however, in September 2008 we
began operating at less than full capacity due to tightening industry margins.
 We may continue to operate at levels less than full capacity as the
ethanol industry undergoes supply and demand corrections.  We expect to
fund our operations during the next 12 months using cash flow from continuing
operations and our revolving line of credit.  We anticipate further
increasing our production capacity in the future to 90 million gallons per year;
however, this additional expansion has been put on hold indefinitely pending
managements review of new technologies and due to the recent erosion of
industry profit margins.  Our revenues are derived
from the sale and distribution of ethanol and distillers grains throughout the
continental United States, Canada, and overseas. In fiscal year 2008, we
produced approximately 53 million gallons of ethanol and 157,000 tons of
distillers grains from approximately 18.6 million bushels of corn. However,
there is no guarantee that we will continue to operate at these production
levels.  Additionally, we may choose not to operate at these production
levels due to tightening industry margins.  The price of ethanol has
historically fluctuated with the price of petroleum-based products such as
unleaded gasoline and crude oil.  The price of distillers grains is
primarily influenced by the price of corn as a substitute feed.  Although
we expect these price relationships to continue in the foreseeable future,
recent volatility in the commodities markets makes historical price
relationships less reliable.  In the future, we also expect to derive
additional revenues from the extraction and sale of corn oil.  We expect to
complete our corn oil extraction project and begin marketing corn oil in our
second fiscal quarter of 2009.  Our two largest costs of
production are corn and natural gas.  The cost of corn is affected by
geopolitical supply and demand factors and the outcome of our risk management
strategies.  Natural gas prices fluctuate with the energy complex in
general, crude oil and unleaded gasoline.  Our costs of production are also
affected by the cost of complying with the extensive environmental laws that
regulate our industry.  We completed the
expansion of our grain storage facility from 450,000 bushels to 900,000 bushels
in July 2008.  We also completed the construction of a new cooling tower
and the installation of additional centrifuges in September 2008.
 Additionally, we completed the expansion of our grain shipping and
receiving area in November 2008.  We purchased and installed a new
distillers grains transportation and cooling system in December 2008.
 Ongoing projects include the addition of a regenerative thermal oxidizer
and a corn oil extraction system.  We expect to complete both of these
projects in May 2009.  Please refer to Item 7  Managements Discussion
and Analysis of Financial Condition and Results of Operations  Plant Expansion
and Construction in Process for further information regarding these
projects.  Financial Information  Please refer to Item
7  Managements Discussion and Analysis of Financial Condition and Results of
Operations for information about our revenues, profit and loss measurements
and total assets and liabilities and Item 8  Financial Statements and
Supplementary Data for our financial statements and supplementary data.   6  Principal
Products and Markets  The principal products
we produce at our plant are fuel grade ethanol and distillers grains.  We
also expect to begin extracting and marketing corn oil in our second fiscal
quarter in 2009, following the completion of our corn oil extraction system.  Ethanol  Ethanol is ethyl
alcohol, a fuel component made primarily from corn and various other grains,
which can be used as: (i) an octane enhancer in fuels; (ii) an
oxygenated fuel additive for the purpose of reducing ozone and carbon monoxide
vehicle emissions; and (iii) a non-petroleum-based gasoline substitute.
More than 99% of all ethanol produced in the United States is used in its
primary form for blending with unleaded gasoline and other fuel products. The
principal purchasers of ethanol are generally wholesale gasoline marketers or
blenders. The principal markets for our ethanol are petroleum terminals in the
continental United States.  For our fiscal years
ended December 31, 2008, 2007 and 2006, revenues from sales of ethanol, net of
derivative activity, were approximately 84%, 89% and 91% of total revenues,
respectively.  Distillers Grains  A principal co-product
of the ethanol production process is distillers grains, a high protein,
high-energy animal feed supplement primarily marketed to the dairy, poultry and
beef industries.  Distillers grains contain by-pass protein that is
superior to other protein supplements such as cottonseed meal and soybean
meal.  By-pass proteins are more digestible to the animal, thus generating
greater lactation in milk cows and greater weight gain in beef cattle.  The
dry mill ethanol processing used by the plant results in two forms of distiller
grains: Distillers Modified Wet Grains (DMWS) and Distillers Dried Grains with
Solubles (DDGS).  DMWS is processed corn mash that has been dried to
approximately 50% moisture.  DMWS have a shelf life of approximately ten
days and are often sold to nearby markets.  DDGS is processed corn mash
that has been dried to 10% to 12% moisture.  DDGS has an almost indefinite
shelf life and may be sold and shipped to any market regardless of its vicinity
to an ethanol plant.  At our plant, the composition of the distillers
grains we produce is approximately 27% DMWS and 73% DDGS.  For our fiscal years
ended December 31, 2008, 2007 and 2006, revenues from sales of distillers
grains, net of derivative activity, were approximately 15%, 12% and 10% of total
revenues, respectively.  Principal Product Markets  As described below in
Distribution of Principal Products, we market and distribute all of our
ethanol and a portion of our DDGS through professional third party marketers.
 We independently market our DMWS and a portion of our DDGS to local
livestock producers.  For our products marketed by professional third party
marketers, our marketers make all decisions with regard to where our products
are marketed.  Our ethanol and distillers grains are primarily sold in the
domestic market.  As distillers grains become more accepted as an animal
feed substitute throughout the world, distillers grains exporting may increase.  We expect our ethanol
and distillers grains marketers to explore all markets for our products,
including export markets.  However, due to high transportation costs, and
the fact that we are not located near a major international shipping port, we
expect a majority of our products to continue to be marketed and sold
domestically.  Distribution of Principal
Products  Our ethanol plant is
located near Friesland, Wisconsin in Columbia County, in south-central
Wisconsin.  We selected the Friesland site because of its location to
existing grain production, accessibility to road and rail transportation and its
close proximity to major highways that connect to major population centers.   7   Ethanol
Distribution  Noble Americas Corp.
(Noble) markets and distributes all of the ethanol we produce at the plant.
 We entered into an ethanol marketing agreement (the Noble Agreement)
with Noble in December 2007.  The Noble Agreement has an initial term of
two years, with automatic renewals for additional periods of two years unless
either party provides notice of termination to the other party at least 180 days
prior to the expiration of the initial term or any subsequent renewal term.
 Under the Noble agreement, Noble enters into sales agreements with third
parties for the sale of the ethanol produced by us.  We then receive the
amount paid per gallon by such third parties, less transportation costs, certain
other costs and fees and a fixed per-gallon marketing fee paid to Noble.  Distillers Grains Distribution  We entered into a
marketing agreement (the CHS Agreement) with CHS Inc. for the purpose of
marketing and selling the DDGS we ship by rail.  For the DDGS marketed and
sold by CHS Inc., we receive a percentage of the sales price invoiced by CHS
Inc. less freight costs incurred by CHS Inc.  The CHS Agreement became
effective on October 1, 2007.  The CHS Agreement will remain in effect
until terminated by either party by providing at least 90 days notice to the
other party to the agreement.  We independently market
and sell our DDGS not shipped by rail, as well as all of the DMWS we produce,
directly to nearby livestock producers.  We have the discretion to
determine how much DMWS we produce relative to DDGS and the quantity of DDGS, if
any, to be shipped by rail from our plant.  New Products and Services  We did not introduce any
new products or services during the fiscal year ended December 31, 2008.
 We anticipate that we will begin extracting and marketing corn oil in our
second fiscal quarter in 2009.  Dependence on One or a Few Major Customers  As discussed above, we
are substantially dependent upon Noble for the purchase, marketing and
distribution of our ethanol. Noble purchases 100% of the ethanol produced at the
plant, all of which is marketed and distributed to its customers. 
Therefore, we are highly dependent on Noble for the successful marketing of our
ethanol.  In the event that our relationship with Noble is interrupted or
terminated for any reason, we believe that we could engage another ethanol
marketer.  However, any interruption or termination of our relationship
with Noble could temporarily disrupt the sale of ethanol and adversely affect
our business and operations.  Additionally, we are
substantially dependent upon CHS Inc. for the purchase, marketing and
distribution of our dried distillers grains shipped by rail.  CHS Inc.
purchases most of the dried distillers grains produced at the plant, which are
then marketed and distributed to CHS Inc.s customers.  In the event that
our relationship with CHS Inc. is interrupted or terminated for any reason, we
believe that we could engage another distillers grains marketer.  However,
any interruption or termination of our relationship with CHS Inc. could
temporarily disrupt the sale of distillers grains and adversely affect our
business and operations.  Seasonality of Ethanol Sales  One of the major uses of
ethanol in the United States is to meet the oxygenated fuel requirement of the
Clean Air Act. The Clean Air Act contains an oxygenated fuel requirement for
areas classified as carbon monoxide non-attainment areas. These areas are
required to establish an oxygenated fuels program for a period of not less than
three months each winter. The minimum oxygen requirement for gasoline sold in
these areas is 2.7% by weight. This is the equivalent of 7.7% ethanol by volume
in a gasoline blend. The other major oxygenate that was previously used was
MTBE. MTBE use as a fuel oxygenate has been replaced by ethanol due to liability
and environmental concerns associated with MTBE. Several states have banned the
use of MTBE as a fuel oxygenate due to these environmental concerns; however,
MTBE has not been banned federally. Due to other ethanol use mandates, including
the Federal Renewable Fuels Standard, which requires a certain amount of ethanol
be used each year in the United States, the seasonal effect of the Clean Air Act
oxygenation requirement has been reduced.  8   Financial
Information about Geographic Areas  All of our operations
are domiciled in the United States.  All of the products sold to our
customers for fiscal years 2008, 2007 and 2006 were produced in the United
States and all of our long-lived assets are domiciled in the United States.
 We have engaged third party professional marketers to market all of our
ethanol and a portion of our distillers grains.  These third party
marketers may decide to sell our products in countries other than the United
States.  Currently, approximately 21% of the distillers grains that we
independently market are exported to Asia.  Sources and Availability of Raw
Materials  Corn Supply  The primary raw material
required for our ethanol plant to produce ethanol and distillers grains is
corn.  To operate at a name-plate capacity of 60 million gallons per year,
the plant requires a supply of approximately 21.5 million bushels of corn
annually.  Since we are a licensed Wisconsin grain dealer, we buy as much
grain as possible from local producers and from local elevators.  Our
commodities manager is responsible for consistent scheduling of corn deliveries
and establishing forward contracts with local producers and through local grain
elevators.  The commodities manager coordinates corn deliveries between
local producers and elevators.We may purchase additional grain
from outside our trade area as need and price dictate.  During the fiscal
year ended December 31, 2008, we purchased approximately $21,850,000 in corn
from some of the Companys members who are local grain producers.  Although we do not
expect to encounter problems in procuring corn, if a shortage of corn developed
we would expect our corn costs to increase significantly.  Due to flooding
events in the Midwest and other poor weather conditions, the price of corn
increased significantly at the end of June and early July 2008.  However,
nearly ideal growing conditions followed for the rest of the 2008 growing season
and significant decreases in commodities markets, along with the collapse of
financial markets, resulted in a significant decrease in corn prices.  The
price and availability of corn are subject to significant fluctuations depending
upon a number of factors affecting grain commodity prices in general, including
crop conditions, weather, governmental programs and foreign purchases. The
market price of ethanol is not directly related to grain prices, and as a
result, ethanol producers are generally not able to compensate for increases in
the cost of grain feedstock through adjustments in prices charged for their
ethanol. We therefore anticipate that our plants profitability will be
negatively impacted during periods of high grain prices.  Natural Gas  Natural gas is also an
important input to our manufacturing process.  We estimate that our current
natural gas usage is approximately 140,000 million British thermal units
(MMBTU) per month when operating at a production rate of 60 million gallons
per year.  We use natural gas to dry our distillers grains products to
moisture contents at which they can be stored for longer periods and transported
greater distances, so that they can be marketed to broader livestock markets,
including poultry and swine markets in the continental United States and
overseas.  We have a natural gas purchase agreement with Constellation New
Energy of Waukesha, Wisconsin to provide natural gas and balancing services.
 We have also engaged Energy Solutions, Inc. of Madison, Wisconsin to
provide natural gas management services.  Patents, Trademarks, Licenses,
Franchises and Concessions  We do not currently hold
any patents, trademarks, franchises or concessions. We were granted a license by
ICM, Inc. to use certain ethanol production technology necessary to operate our
ethanol plant. The cost of the license granted by ICM, Inc. was included in the
amount we paid to Fagen, Inc. to design and build our ethanol plant.  Working Capital  In order to protect the
price of our inputs, namely corn and natural gas, we enter into hedging
transactions that are designed to limit our exposure to increases in the price
of corn and natural gas.  Volatility in corn and  9   natural gas
prices can significantly impact the cash we have available for working capital.
 Such volatility requires us to dedicate significant amounts of cash to
meet margin calls associated with our derivative instruments.  Government Regulation and Federal Ethanol
Supports  Federal Ethanol Supports  The ethanol industry is
dependent on several economic incentives to produce ethanol, including federal
ethanol supports.  One significant federal ethanol support is the Renewable
Fuels Standard (the RFS).  The effect of the RFS on the ethanol industry
is uncertain.  The mandated minimum level of use of renewable fuels under
the RFS increased to 9 billion gallons per year in 2008 (from
5.4 billion gallons under the RFS enacted in 2005), and is scheduled to
increase to 36 billion gallons per year in 2022. The Energy Independence
and Security Act, of which the RFS is part, also requires the increased use of
advanced biofuels, which are alternative biofuels produced without using corn
starch, such as cellulosic ethanol and biomass-based diesel.  Of the 36
billion gallons of renewable fuel required by the RFS by 2022, 21 billion
gallons must come from advanced biofuels. Required RFS volumes for both general
and advanced renewable fuels in years to follow 2022 will be determined by a
governmental administrator, in coordination with the U.S. Department of Energy
and U.S. Department of Agriculture. The scheduled RFS for 2009 is approximately
11 billion gallons.  The increase in the RFS
is likely to increase both the supply and demand for ethanol.  While the
expanded RFS can be met by several different types of renewable fuels, including
biodiesel, the increase in the RFS will likely increase demand for
ethanol.  As the demand for ethanol increases, we expect the ethanol
industry to increase ethanol supply to meet this increased demand. 
Increases in supply may more than offset increases in demand associated with the
RFS.  Waivers of the RFS minimum levels of renewable fuels included in
gasoline could have a material adverse effect on our results of operations.
Under the RFS, as originally passed as part of the Energy Policy Act of 2005,
the U.S. Environmental Protection Agency, or EPA, in consultation with the
Secretary of Agriculture and the Secretary of Energy, may waive the renewable
fuels mandate with respect to one or more states if the Administrator of the EPA
determines upon the petition of one or more states that implementing the
requirements would severely harm the economy or the environment of a state, a
region or the nation, or that there is inadequate supply to meet the
requirement.  On June 18, 2008,
the United States Congress overrode a presidential veto to approve the Food,
Conservation and Energy Act of 2008 (the 2008 Farm Bill) and to ensure that
all parts of the 2008 Farm Bill are enacted into law. Passage of the 2008 Farm
Bill reauthorizes the 2002 farm bill and adds new provisions regarding energy,
conservation, rural development and crop insurance, as well as other subjects.
The energy title continues the energy programs contained in the 2002 farm bill
but refocuses certain provisions on the development of cellulosic ethanol
technology. The new legislation provides assistance for the production, storage
and transport of cellulosic feedstocks and provides support for ethanol
production from such feedstocks in the form of grants, loans and loan
guarantees. The 2008 Farm Bill also modified the ethanol fuels tax credit from
51 cents per gallon to 45 cents per gallon beginning in 2009. The bill also
extended the 54 cent per gallon tariff on imported ethanol for two years, to
January 2011. The 2008 Farm Bill is distinct from the Energy Independence
and Security Act of 2007, which contains the increased renewable fuels standard
described above. There is currently some debate as to whether to repeal the 54
cent per gallon tariff on imported ethanol. If the 54 cent per gallon tariff is
repealed, the demand for domestically produced ethanol may be offset by the
supply of ethanol imported from Brazil or other foreign countries.  Effect of Governmental
Regulation  We are subject to
extensive air, water and other environmental regulations and we have been
required to obtain a number of environmental permits to construct, expand and
operate the plant.  We have obtained all of the necessary permits to
operate the plant, including air pollution construction permits, a pollutant
discharge elimination system general permit, storm water discharge permits, a
water withdrawal permit and an alcohol fuel producers permit.  In
addition, we have completed a spill prevention control and countermeasures
plan.  In the fiscal year ended December 31, 2008, we incurred costs and
expenses of approximately $15,500 complying with environmental laws, including
the cost of obtaining permits.  Although we have been successful in
obtaining all of the permits currently required, any retroactive change in
environmental regulations, either at the federal or state level, could require
us to obtain additional or new permits or spend considerable resources on
complying with such regulations.  10   Additionally,
proceeding with our planned expansion to increase our production capacity to 90
million gallons per year may require us to obtain new permits or modify our
existing permits.  We expect to incur costs and expenses of approximately
$30,000 on environmental compliance in 2009.  We are subject to
oversight activities by the EPA.  There is always a risk that the EPA may
enforce certain rules and regulations differently than Wisconsins
environmental administrators.  Wisconsin or EPA rules are subject to
change, and any such changes could result in greater regulatory burdens on plant
operations.  We could also be subject to environmental or nuisance claims
from adjacent property owners or residents in the area arising from possible
foul smells or other air or water discharges from the plant.  Such claims
may result in an adverse result in court if we are deemed to engage in a
nuisance that substantially impairs the fair use and enjoyment of real
estate.  The governments
regulation of the environment changes constantly.  It is possible that more
stringent federal or state environmental rules or regulations could be
adopted, which could increase our operating costs and expenses.  It also is
possible that federal or state environmental rules or regulations could be
adopted that could have an adverse effect on the use of ethanol.  For
example, changes in the environmental regulations regarding the required oxygen
content of automobile emissions could have an adverse effect on the ethanol
industry.  Furthermore, plant operations are governed by the Occupational
Safety and Health Administration (OSHA).  OSHA regulations may change
such that the costs of operating the plant may increase.  Any of these
regulatory factors may result in higher costs or other materially adverse
conditions affecting our operations, cash flows and financial performance.  Competition  We are in direct
competition with numerous ethanol producers, many of whom have greater resources
than we do. During our 2008 fiscal year, there was relatively slower growth in
the number of new ethanol producers entering the market due to high corn prices
and relatively lower ethanol prices as compared to 2006 and 2005. We anticipate
that ethanol production will continue to increase in order to meet the ethanol
use mandates included in the Federal Renewable Fuels Standard. However, we also
expect increased competition from other forms of renewable energy, specifically
cellulosic ethanol.  Cellulose is the main
component of plant cell walls and is the most common organic compound on earth.
Cellulose is found in wood chips, corn stalks, rice straw, amongst other common
plants. Cellulosic ethanol is ethanol produced from cellulose. Many of the
government incentives that have recently been passed, including the expanded
Renewable Fuels Standard and the 2008 Farm Bill, have included significant
incentives to assist in the development of commercially viable cellulosic
ethanol. Currently, the technology is not sufficiently advanced to produce
cellulosic ethanol on a commercial scale, however, due to these new government
incentives, we anticipate that commercially viable cellulosic ethanol technology
will be developed in the near future. Several companies and researchers have
commenced pilot projects to study the feasibility of commercially producing
cellulosic ethanol. If this technology can be profitably employed on a
commercial scale, it could potentially lead to ethanol that is less expensive to
produce than corn based ethanol, especially if corn prices remain high. We do
not believe it would be feasible to convert our ethanol plant to a new
cellulosic ethanol production technology. Cellulosic ethanol may also capture
more government subsidies and assistance than corn based ethanol. This could
decrease demand for our product or result in competitive disadvantages for our
ethanol production process.  Ethanol is a commodity
product, like corn, which means our ethanol plant competes with other ethanol
producers on the basis of price and, to a lesser extent, delivery service. 
We believe we compete favorably with other ethanol producers due to our
proximity to ample grain supplies and multiple modes of transportation. 
However, during our 2008 fiscal year, some consolidation of the ethanol industry
occurred, especially with the merger between VeraSun Energy Corporation and U.S.
BioEnergy Corp., although the merged entity later filed for bankruptcy, as
discussed in the next paragraph.  Management believes that conditions are
right for further consolidation in the ethanol industry.  Management
believes this is especially true as a result of the significant financial
hardship that has been occurring in the ethanol industry recently. 
Consolidation in the ethanol industry may put us at a competitive disadvantage
compared to other larger ethanol producers.  Larger ethanol producers may
realize economies of scale in the production of ethanol and distillers grains
that we cannot take advantage of, specifically with respect to larger sales of
ethanol and increased bargaining power for raw materials, including corn and
natural gas.  11    According to the Renewable Fuels Association, as of March 5, 2009,
the ethanol industry has grown to 193 production facilities in the United
States. There are 23 new plants currently under construction along with
approximately 3 plant expansions. The Renewable Fuels Association currently
estimates that the United States ethanol industry has capacity to produce nearly
12.4 billion gallons of ethanol per year.  The Renewable Fuels Association
has reported that approximately 16% of that production capacity is not currently
operational. Others estimate that 20% or more of the nations ethanol production
capacity is currently idle. The new ethanol plants under construction along with
the plant expansions under construction could push United States production of
fuel ethanol in the near future to nearly 14.4 billion gallons per year.
The largest ethanol producers include POET, Archer Daniels Midland, VeraSun
Energy Corporation and Hawkeye Renewables, each of which are capable of
producing more ethanol than we produce. However, VeraSun recently filed for
Chapter 11 Bankruptcy and has announced that it intends to auction off all
of its ethanol plants by March 31, 2009. Other ethanol producers may be in
a position to purchase the assets of VeraSun which could further consolidate the
ethanol industry.  Certain other ethanol producers have also filed for
bankruptcy.  The purchase of the assets of these other ethanol producers
may also result in further consolidation in the ethanol industry.  The following table
identifies most of the ethanol producers in the United States along with
their production capacities.  Company
Location
Feedstock
Nameplate
Capacity (mgy)
Operating
Production (mgy)
Under
Construction/Expansion Capacity (mgy)Abengoa Bioenergy Corp.
(Total)


198.0
168.0
176.0Abengoa Bioenergy Corp.
Madison, IL
cornAbengoa Bioenergy Corp.
Mt. Vernon, IN
cornAbengoa Bioenergy Corp.
Colwich, KS
corn/miloAbengoa Bioenergy Corp.
Ravenna, NE
CornAbengoa Bioenergy Corp.
York, NE
CornAbengoa Bioenergy Corp.
Portales, NM
cornAbsolute Energy, LLC*
St. Ansgar, IA
Corn
100.0
100.0ACE Ethanol, LLC
Stanley, WI
Corn
41.0
41.0Adkins Energy, LLC*
Lena, IL
Corn
40.0
40.0Advanced Bioenergy, LLC
Fairmont, NE
Corn
100.0
100.0Advanced Bioenergy, LLC
Aberdeen, SD
Corn
50.0
50.0Advanced Bioenergy, LLC
Huron, SD
Corn
32.0
32.0
33.0Ag Energy Resources,
Inc.
Benton, IL
corn


5.0AGP*
Hastings, NE
Corn
52.0
52.0Agri-Energy, LLC*
Luverne, MN
Corn
21.0
21.0Al-Corn Clean Fuel*
Claremont, MN
Corn
42.0
42.0Alchem Ltd. LLP
Grafton, ND
Corn
10.0AltraBiofuels Coshocton
Ethanol, LLC
Coshocton, OH
corn
60.0AltraBiofuels Indiana,
LLC
Cloverdale, IN
corn
92.0  12    AltraBiofuels Phoenix Bio
Industries, LLC
Goshen, CA
Corn
31.5
31.5Amaizing Energy, LLC*
Atlantic, IA
Corn


110.0Amaizing Energy, LLC*
Denison, IA
Corn
48.0
48.0Archer Daniels Midland
(Total)


1,070.0
1,070.0
550.0Archer Daniels Midland
Cedar Rapids, IA
CornArcher Daniels Midland
Clinton, IA
CornArcher Daniels Midland
Decatur, IL
CornArcher Daniels Midland
Peoria, IL
CornArcher Daniels Midland
Marshall, MN
CornArcher Daniels Midland
Wallhalla, ND
Corn/barleyArcher Daniels Midland
Columbus, NE
CornArkalon Energy, LLC
Liberal, KS
Corn
110.0
110.0Aventine Renewable Energy, LLC
(Total)


207.0
207.0Aventine Renewable Energy,
LLC
Pekin, IL
CornAventine Renewable Energy,
LLC
Aurora, NE
CornBadger State Ethanol,
LLC*
Monroe, WI
Corn
48.0
48.0Big River Resources Galva,
LLC
Galva, IL
corn


100.0Big River Resources,
LLC*
West Burlington, IA
Corn
92.0
92.0BioFuel Energy - Buffalo Lake
Energy, LLC
Fairmont, MN
Corn
115.0
115.0BioFuel Energy - Pioneer Trail
Energy, LLC
Wood River, NE
Corn
115.0
115.0Bional Clearfield
Clearfield, PA
Corn


110.0Blue Flint Ethanol
Underwood, ND
Corn
50.0
50.0Bonanza Energy, LLC
Garden City, KS
Corn/milo
55.0
55.0Bridgeport Ethanol
Bridgeport, NE
corn
54.0
54.0Bunge-Ergon Vicksburg
Vicksburg, MS
corn
54.0
54.0Bushmills Ethanol,
Inc.*
Atwater, MN
Corn
50.0
50.0Calgren Renewable Fuels,
LLC
Pixley, CA
Corn


55.0Cardinal Ethanol
Union City, IN
Corn
100.0
100.0Cargill, Inc.
Eddyville, IA
Corn
35.0
35.0Cargill, Inc.
Blair, NE
Corn
85.0
85.0Cascade Grain
Clatskanie, OR
Corn
108.0Castle Rock Renewable Fuels,
LLC
Necedah, WI
Corn
50.0
50.0Center Ethanol Company
Sauget, IL
Corn
54.0
54.0  13    Central Indiana Ethanol,
LLC
Marion, IN
Corn
40.0
40.0Central MN Ethanol
Coop*
Little Falls, MN
Corn
21.5
21.5Chief Ethanol
Hastings, NE
Corn
62.0
62.0Chippewa Valley Ethanol
Co.*
Benson, MN
Corn
45.0
45.0Cilion Ethanol
Keyes, CA
Corn


50.0Clean Burn Fuels, LLC
Raeford, NC
Corn


60.0Commonwealth Agri-Energy,
LLC*
Hopkinsville, KY
Corn
33.0
33.0Corn Plus, LLP*
Winnebago, MN
Corn
44.0
44.0Corn, LP*
Goldfield, IA
Corn
55.0
55.0Cornhusker Energy Lexington,
LLC
Lexington, NE
Corn
40.0
40.0Dakota Ethanol, LLC*
Wentworth, SD
Corn
50.0
50.0DENCO, LLC
Morris, MN
Corn
24.0Didion Ethanol
Cambria, WI
Corn
40.0
40.0E Caruso (Goodland Energy
Center)
Goodland, KS
Corn


20.0E Energy Adams, LLC
Adams, NE
Corn
50.0
50.0E3 Biofuels
Mead, NE
corn
25.0East Kansas Agri-Energy,
LLC*
Garnett, KS
Corn
35.0
35.0ESE Alcohol Inc.
Leoti, KS
Seed corn
1.5
1.5Ethanol Grain Processors,
LLC
Obion, TN
Corn
100.0
100.0Front Range Energy, LLC
Windsor, CO
Corn
40.0
40.0Gateway Ethanol
Pratt, KS
Corn
55.0Glacial Lakes Energy, LLC -
Mina
Mina, SD
corn
107.0
107.0Glacial Lakes Energy,
LLC*
Watertown, SD
Corn
100.0
100.0Global Ethanol/Midwest Grain
Processors
Lakota, IA
Corn
97.0
97.0Global Ethanol/Midwest Grain
Processors
Riga, MI
Corn
57.0
57.0Golden Cheese Company of
California*
Corona, CA
Cheese whey
5.0
5.0Golden Grain Energy,
LLC*
Mason City, IA
Corn
115.0
115.0Golden Triangle Energy,
LLC*
Craig, MO
Corn
20.0
20.0Grain Processing Corp.
Muscatine, IA
Corn
20.0
20.0Granite Falls Energy,
LLC*
Granite Falls, MN
Corn
52.0
52.0  14    Greater Ohio Ethanol,
LLC
Lima, OH
Corn
54.0Green Plains Renewable
Energy
Shenandoah, IA
Corn
55.0
55.0Green Plains Renewable
Energy
Superior, IA
Corn
55.0
55.0Hawkeye Renewables, LLC
Fairbank, IA
Corn
120.0
120.0Hawkeye Renewables, LLC
Iowa Falls, IA
Corn
105.0
105.0Hawkeye Renewables, LLC
Menlo, IA
Corn
110.0
110.0Hawkeye Renewables, LLC
Shell Rock, IA
Corn
110.0
110.0Heartland Corn
Products*
Winthrop, MN
Corn
100.0
100.0Heron Lake BioEnergy,
LLC
Heron Lake, MN
Corn
50.0
50.0Highwater Ethanol LLC
Lamberton, MN
Corn


50.0Homeland Energy
New Hampton, IA
Corn


100.0Husker Ag, LLC*
Plainview, NE
Corn
75.0
75.0Idaho Ethanol
Processing
Caldwell, ID
Potato Waste
4.0
4.0Illinois River Energy,
LLC
Rochelle, IL
Corn
100.0
100.0Indiana Bio-Energy
Bluffton, IN
Corn
101.0
101.0Iroquois Bio-Energy Company,
LLC
Rensselaer, IN
corn
40.0
40.0KAAPA Ethanol, LLC*
Minden, NE
Corn
40.0
40.0Kansas Ethanol, LLC
Lyons, KS
Corn
55.0
55.0KL Process Design Group
Upton, WY
Wood waste
1.5
1.5Land O' Lakes*
Melrose, MN
Cheese whey
2.6
2.6LDCommodities
Grand Junction, IA
corn


100.0LDCommodities
Norfolk, NE
Corn
45.0
45.0Levelland/Hockley County
Ethanol, LLC
Levelland, TX
Corn
40.0
40.0Lifeline Foods, LLC
St. Joseph, MO
Corn
40.0
40.0Lincolnland Agri-Energy,
LLC*
Palestine, IL
Corn
48.0
48.0Lincolnway Energy, LLC*
Nevada, IA
Corn
50.0
50.0Little Sioux Corn Processors,
LP*
Marcus, IA
Corn
92.0
92.0Marquis Energy, LLC
Hennepin, IL
Corn
100.0
100.0Marysville Ethanol, LLC
Marysville, MI
Corn
50.0
50.0Merrick & Company
Aurora, CO
Waste beer
3.0
3.0  15    Mid America Agri
Products/Horizon
Cambridge, NE
Corn
44.0
44.0Mid America Agri
Products/Wheatland
Madrid, NE
Corn
44.0
44.0Mid-Missouri Energy,
Inc.*
Malta Bend, MO
Corn
50.0
50.0Midwest Renewable Energy,
LLC
Sutherland, NE
Corn
25.0
25.0Minnesota Energy*
Buffalo Lake, MN
Corn
18.0
18.0NEDAK Ethanol
Atkinson, NE
corn


44.0Nesika Energy, LLC
Scandia, KS
corn
10.0
10.0New Energy Corp.
South Bend, IN
Corn
102.0
102.0North Country Ethanol,
LLC*
Rosholt, SD
Corn
20.0
20.0Northeast Biofuels
Volney, NY
Corn
114.0Northwest Renewable,
LLC
Longview, WA
Corn


55.0One Earth Energy
Gibson City, IL
corn


100.0Otter Tail Ag
Enterprises
Fergus Falls, MN
Corn
57.5
57.5Pacific Ethanol
Madera, CA
Corn
40.0Pacific Ethanol
Stockton, CA
Corn
60.0Pacific Ethanol
Burley, ID
Corn
50.0Pacific Ethanol
Boardman, OR
Corn
40.0
40.0Panda Ethanol
Hereford, TX
Corn/milo


115.0Parallel Products
Rancho Cucamonga, CAParallel Products
Louisville, KY
Beverage waste
5.4
5.4Patriot Renewable Fuels,
LLC
Annawan, IL
Corn
100.0
100.0Penford Products
Cedar Rapids, IA
Corn
45.0
45.0Pinal Energy, LLC
Maricopa, AZ
Corn
55.0
55.0Pine Lake Corn Processors,
LLC
Steamboat Rock, IA
corn
30.0
30.0Platinum Ethanol, LLC*
Arthur, IA
Corn
110.0
110.0Plymouth Ethanol, LLC*
Merrill, IA
Corn
50.0
50.0POET Biorefining -
Alexandria
Alexandria, IN
Corn
68.0
68.0POET Biorefining -
Ashton
Ashton, IA
Corn
56.0
56.0POET Biorefining - Big
Stone
Big Stone City, SD
Corn
79.0
79.0POET Biorefining - Bingham
Lake
Bingham Lake, MN

35.0
35.0POET Biorefining - Caro
Caro, MI
Corn
53.0
53.0  16    POET Biorefining -
Chancellor
Chancellor, SD
Corn
110.0
110.0POET Biorefining - Coon
Rapids
Coon Rapids, IA
Corn
54.0
54.0POET Biorefining -
Corning
Corning, IA
Corn
65.0
65.0POET Biorefining -
Emmetsburg
Emmetsburg, IA
Corn
55.0
55.0POET Biorefining -
Fostoria
Fostoria, OH
Corn
68.0
68.0POET Biorefining -
Glenville
Albert Lea, MN
Corn
42.0
42.0POET Biorefining -
Gowrie
Gowrie, IA
Corn
69.0
69.0POET Biorefining -
Hanlontown
Hanlontown, IA
Corn
56.0
56.0POET Biorefining -
Hudson
Hudson, SD
Corn
56.0
56.0POET Biorefining -
Jewell
Jewell, IA
Corn
69.0
69.0POET Biorefining -
Laddonia
Laddonia, MO
Corn
50.0
50.0
5.0POET Biorefining - Lake
Crystal
Lake Crystal, MN
Corn
56.0
56.0POET Biorefining -
Leipsic
Leipsic, OH
Corn
68.0
68.0POET Biorefining -
Macon
Macon, MO
Corn
46.0
46.0POET Biorefining -
Marion
Marion, OH
Corn


65.0POET Biorefining -
Mitchell
Mitchell, SD
Corn
68.0
68.0POET Biorefining - North
Manchester
North Manchester, IN
Corn
68.0
68.0POET Biorefining -
Portland
Portland, IN
Corn
68.0
68.0POET Biorefining -
Preston
Preston, MN
Corn
46.0
46.0POET Biorefining -
Scotland
Scotland, SD
Corn
11.0
11.0POET Biorefining-
Groton
Groton, SD
Corn
53.0
53.0Prairie Horizon Agri-Energy,
LLC
Phillipsburg, KS
Corn
40.0
40.0Quad-County Corn
Processors*
Galva, IA
Corn
30.0
30.0Range Fuels
Soperton, GA
Wood waste


20.0Red Trail Energy, LLC
Richardton, ND
Corn
50.0
50.0Redfield Energy, LLC *
Redfield, SD
Corn
50.0
50.0  17    Reeve Agri-Energy
Garden City, KS
Corn/milo
12.0
12.0Renew Energy
Jefferson Junction, WI
Corn
130.0
130.0Renova Energy
Torrington, WY
Corn
5.0
5.0Riverland Biofuels
Canton, IL
corn
37.0
37.0Show Me Ethanol
Carrollton, MO
Corn
55.0
55.0Siouxland Energy &
Livestock Coop*
Sioux Center, IA
Corn
60.0
60.0Siouxland Ethanol, LLC
Jackson, NE
Corn
50.0
50.0Southwest Georgia Ethanol,
LLC
Camilla, GA
Corn
100.0
100.0Southwest Iowa Renewable
Energy, LLC *
Council Bluffs, IA
Corn
110.0
110.0Sterling Ethanol, LLC
Sterling, CO
Corn
42.0
42.0Tate & Lyle
Ft. Dodge, IA
Corn


105.0Tate & Lyle
Loudon, TN
Corn
67.0
67.0
38.0Tharaldson Ethanol
Casselton, ND
Corn
110.0
110.0The Andersons Albion Ethanol
LLC
Albion, MI
Corn
55.0
55.0The Andersons Clymers Ethanol,
LLC
Clymers, IN
Corn
110.0
110.0The Andersons Marathon
Ethanol, LLC
Greenville, OH
Corn
110.0
110.0Trenton Agri Products,
LLC
Trenton, NE
Corn
40.0
40.0United Ethanol
Milton, WI
Corn
52.0
52.0United WI Grain Producers,
LLC*
Friesland, WI
Corn
49.0
49.0Utica Energy, LLC
Oshkosh, WI
Corn
48.0
48.0VeraSun Energy Corp.
Dyersville, IA
cornVeraSun Energy Corp.
Linden, IN
CornVeraSun Energy Corp.
Lake Odessa, MI
CornVeraSun Energy Corp.
Janesville, MN
cornVeraSun Energy Corp.
Welcome, MN
cornVeraSun Energy Corp.
Hankinson, ND
cornVeraSun Energy Corp.
Albion, NE
cornVeraSun Energy Corp.
Central City, NE
cornVeraSun Energy Corp.
Ord, NE
CornVeraSun Energy Corp.
Bloomingburg, OH
cornVeraSun Energy Corp.
Marion, SD
cornVeraSun Energy Corporation
(Total)


1,635.0
450.0VeraSun Energy
Corporation
Albert City, IA
Corn  18   VeraSun Energy
Corporation
Charles City, IA
CornVeraSun Energy
Corporation
Ft. Dodge, IA
CornVeraSun Energy
Corporation
Hartley, IA
CornVeraSun Energy
Corporation
Welcome, MN
CornVeraSun Energy
Corporation
Aurora, SD
CornVerenium
Jennings, LA
Sugar Cane bagasse
1.5
1.5Western New York Energy
LLC
Shelby, NY

50.0
50.0Western Plains Energy,
LLC*
Campus, KS
Corn
45.0
45.0Western Wisconsin Renewable
Energy, LLC*
Boyceville, WI
Corn
40.0
40.0White Energy
Russell, KS
Milo/wheat starch
48.0
48.0White Energy
Hereford, TX
Corn/Milo
100.0
100.0White Energy
Plainview, TX
Corn
110.0Wind Gap Farms
Baconton, GA
Brewery waste
0.4
0.4Xethanol BioFuels, LLC
Blairstown, IA
Corn
5.0
5.0Yuma Ethanol
Yuma, CO
Corn
40.0
40.0TOTALS

12,375.4
mgy
for193nameplate refineries
10,358.4
mgy
foroperating refineries
2,066.0
mgy forunder
construction/ expanding refineries  * locally owned Source: Renewable Fuels Association Last updated: March 5, 2009  Ethanol production is
also expanding internationally. Ethanol produced or processed in certain
countries in Central America and the Caribbean region is eligible for tariff
reduction or elimination on importation to the United States under a program
known as the Caribbean Basin Initiative. Some ethanol producers, including
Cargill, have started taking advantage of this situation by building dehydration
plants in participating Caribbean Basin countries, which convert ethanol into
fuel-grade ethanol for shipment to the United States. Ethanol imported from
Caribbean Basin countries may be a less expensive alternative to domestically
produced ethanol and may affect our ability to sell our ethanol profitably.
Further, despite the fact that there is a significant amount of ethanol produced
in the United States, ethanol produced abroad and shipped by sea may be a more
favorable alternative to supply coastal cities that are located on international
shipping ports.  Our ethanol plant also
competes with producers of other gasoline additives having similar octane and
oxygenate values as ethanol. Alternative fuels, gasoline oxygenates and
alternative ethanol production methods are also continually under development.
The major oil companies have significantly greater resources than we have to
market other additives, to develop alternative products, and to influence
legislation and public perception of ethanol. These companies also have
sufficient resources to begin production of ethanol should they choose to do
so.  19   A number of automotive, industrial and power generation
manufacturers are developing alternative clean power systems using fuel cells or
clean burning gaseous fuels. Like ethanol, the emerging fuel cell industry
offers a technological option to address increasing worldwide energy costs, the
long-term availability of petroleum reserves and environmental concerns. Fuel
cells have emerged as a potential alternative to certain existing power sources
because of their higher efficiency, reduced noise and lower emissions. Fuel cell
industry participants are currently targeting the transportation, stationary
power and portable power markets in order to decrease fuel costs, lessen
dependence on crude oil and reduce harmful emissions. If the fuel cell and
hydrogen industries continue to expand and gain broad acceptance and hydrogen
becomes readily available to consumers for motor vehicle use, we may not be able
to compete effectively. This additional competition could reduce the demand for
ethanol, which would negatively impact our profitability.  Demand for ethanol may
increase as a result of increased consumption of E85 fuel. E85 fuel is a blend
of 85% ethanol and 15% gasoline. According to United States Department of Energy
estimates, there are currently more than 7 million flexible fuel vehicles
capable of operating on E85 in the United States. Further, the United States
Department of Energy reports that there are currently more than 1,600 retail
gasoline stations supplying E85. The number of retail E85 suppliers increases
significantly each year, however, this remains a relatively small percentage of
the total number of U.S. retail gasoline stations, which is approximately
170,000. In order for E85 fuel to increase demand for ethanol, it must be
available for consumers to purchase it. As public awareness of ethanol and E85
increases along with E85s increased availability, management anticipates some
growth in demand for ethanol associated with increased E85
consumption.  Research and Development  We do not currently
conduct any research and development activities associated with the development
of new technologies for use in producing ethanol or distillers grains.  Employees  As of December 31, 2008,
we had a total of 38 full-time employees and no part-time employees.  ITEM 1A.  RISK FACTORS.   You should carefully
read and consider the risks and uncertainties below and the other information
contained in this report. The risks and uncertainties described below are not
the only ones we may face. The following risks, together with additional risks
and uncertainties not currently known to us or that we currently deem immaterial
could impair our financial condition and results of operation.  Risks Relating to Our Business  Increases in the
price of corn or natural gas would reduce our profitability.Our results
of operations and financial condition are significantly affected by the cost and
supply of corn and natural gas. Changes in the price and supply of corn and
natural gas are subject to and determined by market forces over which we have no
control.  As we experienced during
the early summer of 2008, weather factors can have a very significant impact on
the selling price of corn. Following unfavorable weather conditions and flooding
in the Midwest during the beginning of the 2008 growing season, the price per
bushel of corn increased significantly and peaked during July 2008.
Following this unfavorable weather in the early part of the growing season, the
United States experienced favorable weather conditions through the rest of the
2008 growing season. According to USDA reports, despite the early poor weather,
the corn crop harvested in the fall of 2008 was the second largest on record
following 2007s crop. Ethanol production requires substantial amounts of corn.
Generally, higher corn prices will produce lower profit margins and, therefore,
negatively affect our financial performance. Our total corn cost per bushel
during our 2008 fiscal year was approximately 54% higher than the corn costs we
experienced in our 2007 fiscal year. While corn prices have significantly
decreased following a peak in July 2008, current corn prices are higher
than historical averages. If a period of high corn prices were to be sustained
for some time, such pricing may reduce our ability to operate profitably because
of the higher cost of operating our plant. We may not be able to offset any
increase in the price of corn by increasing the price of our products. If we
cannot offset increases in the price of corn, our financial performance may be
negatively affected.  20   The prices for and availability of natural gas are subject to
volatile market conditions. These market conditions often are affected by
factors beyond our control such as higher prices as a result of colder than
average weather conditions or natural disasters, overall economic conditions and
foreign and domestic governmental regulations and relations. Significant
disruptions in the supply of natural gas could impair our ability to manufacture
ethanol and more significantly, distillers grains for our customers.
Furthermore, increases in natural gas prices or changes in our natural gas costs
relative to natural gas costs paid by competitors may adversely affect our
results of operations and financial condition. We seek to minimize the risks
from fluctuations in the prices of corn and natural gas through the use of
hedging instruments. However, these hedging transactions also involve risks to
our business. See Risks Relating to Our Business  We engage in hedging
transactions which involve risks that could harm our business.  Declines in the
price of ethanol or distillers grain would significantly reduce our
revenues. The sales prices of ethanol and distillers grains can be
volatile as a result of a number of factors such as overall supply and demand,
the price of gasoline and corn, level of government support, and the
availability and price of competing products. Recently, the price of ethanol and
distillers grains have trended downward as the prices of corn and gasoline have
fallen. We are dependant on a favorable spread between the price we receive for
our ethanol and distillers grains and the price we pay for corn and natural gas.
Any continued lowering of ethanol and distillers grains prices, especially if it
is associated with increases in corn and natural gas prices, may reduce our
revenues and affect our ability to operate profitably.  The average price we
received for our ethanol increased by approximately 21% during our 2008 fiscal
year compared to our 2007 fiscal year; however, the price we paid for corn
increased by approximately 54% during the same time periods. We anticipate the
price of ethanol and distillers grains to continue to be volatile in our 2009
fiscal year as a result of the net effect of changes in the price of gasoline
and corn and increased ethanol supply offset by increased ethanol demand.
Continued declines in the prices we receive for our ethanol and distillers
grains will lead to decreased revenues and may result in our inability to
operate the ethanol plant profitably for an extended period of time, which could
decrease the value of our membership units.  Additional credit
facilities may become difficult to obtain.Due to current conditions in
the credit markets, it has been increasingly difficult for businesses to secure
financing. While we do not currently require more financing than we have, in the
future we may need additional financing.  If we require financing in the
future and we are unable to secure such financing, it may have a negative impact
on our liquidity. This could negatively impact the value of our membership
units.  Also, an inability to obtain additional financing would force us to
abandon our plans to further expand our plant capacity to 90 million gallons per
year.  We sell all of the
ethanol we produce to Noble Americas Corp. under our ethanol marketing
agreement, and any interruption in or termination of this relationship may
adversely affect our business and operations.Noble
Americas Corp. (Noble) is the sole buyer of all of our ethanol, and we rely
heavily on its marketing efforts to successfully sell our product.  Our
financial performance is dependent upon the financial health of Noble, as a
significant portion of our accounts receivable are attributable to Noble. 
If Noble breaches the ethanol marketing agreement or is not in the financial
position to purchase and market all of the ethanol we produce, we could
experience a material loss and we may not have any readily available means to
sell our ethanol, meaning our financial performance would be adversely and
materially affected.  If our agreement with Noble terminates, we may seek
other arrangements to sell our ethanol, including selling our own product;
however, our sales efforts may not achieve results comparable to those achieved
by Noble.  We sell a
substantial portion of the distillers grains we produce to CHS Inc. under our
distillers grains marketing agreement, and any interruption in or termination of
this relationship may adversely affect our business and
operations.CHS Inc. is the sole buyer of all of our dried
distillers grains that we ship by rail, and we rely heavily on its marketing
efforts to successfully sell our product.  Because CHS Inc. sells
distillers grains for a number of other producers, we have limited control over
its sales efforts.  Our financial performance is dependent upon the
financial health of CHS Inc., as a significant portion of our accounts
receivable are attributable to CHS Inc.  If CHS Inc. breaches the
distillers grains marketing agreement or is not in a financial position to
purchase and market all of the distillers grains we produce, we could experience
a material loss and we may not have any readily available means to sell our
distillers grains, and our financial performance will be adversely and
materially affected.  If our agreement with CHS Inc. terminates, we may
seek other arrangements to sell our distillers grains, including  21   selling our own
product, but we give no assurance that our sales efforts would achieve results
comparable to those achieved by CHS Inc.  We have a limited
operating history.We began our business in 2001 and commenced
production of ethanol at our plant in May 2005.  Further, we substantially
completed an expansion project in December 2007 that increased our ethanol
and distillers grains production capacity by approximately 50%. 
Accordingly, we have a limited operating history from which you can evaluate our
business and prospects.  Our operating results could fluctuate
significantly in the future as a result of a variety of factors, including those
discussed throughout these risk factors.  Many of these factors are outside
of our control.   As a result of these factors, our operating results
may not be indicative of future operating results and you should not rely on
them as indications of our future performance.  In addition, our prospects
must be considered in light of the risks and uncertainties encountered by an
early-stage company in a rapidly growing industry, such as the ethanol industry,
where supply and demand may change substantially in a short period of time.  We engage in
hedging transactions which involve risks that could harm our business.We are exposed to market risk from changes in commodity prices. Exposure
to commodity price risk results from our dependence on corn and natural gas in
the ethanol production process. We seek to minimize the risks from fluctuations
in the prices of corn, natural gas and ethanol through the use of hedging
instruments. The effectiveness of our hedging strategies is dependent on the
price of corn, natural gas and ethanol and our ability to sell sufficient
products to use all of the corn and natural gas for which we have futures
contracts. Our hedging activities may not successfully reduce the risk caused by
price fluctuation which may leave us vulnerable to high corn and natural gas
prices, as well as low ethanol prices.  Some of our forward corn purchase
contracts are at prices above current market prices for corn.  Given
declining corn prices, upon taking delivery under these contracts, we expect to
incur a loss as a lower of cost or market adjustment.  Given the
uncertainty of future corn prices, such losses may not be recovered, and further
losses could be recorded in future periods.  Price movements in corn,
natural gas and ethanol contracts are highly volatile and are influenced by many
factors that are beyond our control.  There are several variables that
could affect the extent to which our derivative instruments are impacted by
price fluctuations in the cost of corn or natural gas.  However, it is
likely that commodity cash prices will have the greatest impact on the
derivatives instruments with delivery dates nearest the current cash
price.  We may incur such costs and they may be significant.  Operational
difficulties at our ethanol plant could negatively impact our sales volumes and
could cause us to incur substantial losses.Our operations
are subject to labor disruptions, unscheduled downtime and other operational
hazards inherent in our industry, such as equipment failures, fires, explosions,
abnormal pressures, blowouts, pipeline ruptures, transportation accidents and
natural disasters.  Some of these operational hazards may cause personal
injury or loss of life, severe damage to or destruction of property and
equipment or environmental damage, and may result in suspension of operations
and the imposition of civil or criminal penalties.  Our insurance may not
be adequate to fully cover the potential operational hazards described above or
we may not be able to renew this insurance on commercially reasonable terms or
at all.  If we experience operational hazards, we may be forced to cease
operations for a period of time or permanently.  Our business is
not diversified.Our success depends largely on our ability to
profitably operate our ethanol plant. We do not have any other lines of business
or other sources of revenue if we are unable to operate our ethanol plant and
manufacture ethanol and distillers grains. If economic or political factors
adversely affect the market for ethanol and distillers grains, we have no other
line of business to fall back on. Our business would also be significantly
harmed if the ethanol plant could not operate at full capacity for any extended
period of time.  We depend on our
management and key employees, and the loss of these relationships could
negatively impact our ability to operate profitably.We are highly
dependent on our management team to operate our ethanol plant. We may not be
able to replace these individuals should they decide to cease their employment
with us, or if they become unavailable for any other reason. Any loss of these
officers and key employees may prevent us from operating the ethanol plant
profitably and could decrease the value of our membership units.  Changes and
advances in ethanol production technology could require us to incur costs to
update our plant or could otherwise hinder our ability to compete in the ethanol
industry or operate profitably.Advances and changes in the technology
of ethanol production are expected to occur. Such advances and changes may make
the 22    ethanol
production technology installed in our plant less desirable or obsolete. These
advances could also allow our competitors to produce ethanol at a lower cost
than the cost at which we are able to produce ethanol. We do not believe it
would be feasible to convert our ethanol plant to new cellulosic ethanol
production technology. If we are unable to adopt or incorporate technological
advances, our ethanol production methods and processes could be less efficient
than our competitors, which could cause our plant to become uncompetitive or
completely obsolete. If our competitors develop, obtain or license technology
that is superior to ours or that makes our technology obsolete, we may be
required to incur significant costs to enhance or acquire new technology so that
our ethanol production remains competitive. Alternatively, we may be required to
seek third-party licenses, which could also result in significant expenditures.
These third-party licenses may not be available or, once obtained, they may not
continue to be available on commercially reasonable terms, if at all. These
costs could negatively impact our financial performance by increasing our
operating costs and reducing our net income.  Risks Related to Ethanol
Industry  A reduction in the
consumption of gasoline may decrease the demand for ethanol as a blending agent
which may negatively affect our profitability.Recently the demand for
gasoline has decreased nationally, which has in turn reduced the demand for
ethanol. According to the Energy Information Administration (EIA), gasoline
consumption in the United States for 2008 decreased by 3.1 billion gallons,
or 2.2%, compared to 2007. This decline in gasoline consumption may exacerbate
the blend wall dilemma by reducing the aggregate amount of ethanol that our
nation consumes. The blend wall refers to the amount of ethanol that may be
blended with petroleum based fuel. Current federal standards set the amount of
ethanol that can be blended with gasoline at a maximum rate of ten percent.
Gasoline consumption in 2008 was estimated by the Energy Information
Administration to be approximately 140 billion gallons, which means that
even if ethanol is blended with 90 percent of the gasoline at a rate of ten
percent, the nation would use approximately 12.5 billion gallons of
ethanol. This 12.5 billion gallon figure is referred to as the blend wall.
Accordingly, if either gasoline consumption or the percentage of gasoline
containing ethanol declines, the blend wall figure will also decline. If demand
for gasoline and ethanol continues to decrease, we may not be able to operate
our ethanol plant profitably.  Technology
advances in the commercialization of cellulosic ethanol may decrease demand for
corn based ethanol which may negatively affect our profitability.The
current trend in ethanol production research is to develop an efficient method
of producing ethanol from cellulose-based biomass, such as agricultural waste,
forest residue, municipal solid waste, and energy crops. This trend is driven by
the fact that cellulose-based biomass is generally cheaper than corn, and
producing ethanol from cellulose-based biomass would create opportunities to
produce ethanol in areas which are unable to grow corn. The Energy Independence
and Security Act of 2007 and the 2008 Farm Bill offer strong incentives to
develop commercial scale cellulosic ethanol. The RFS requires that
21 billion gallons per year of advanced bio-fuels be consumed in the United
States by 2022. Additionally, state and federal grants have been awarded to
several companies who are seeking to develop commercial-scale cellulosic ethanol
plants. We expect this will encourage innovation that may lead to commercially
viable cellulosic ethanol plants in the near future. If an efficient method of
producing ethanol from cellulose-based biomass is developed, we may not be able
to compete effectively. We do not believe it will be cost-effective to convert
our ethanol plant into a plant which will use cellulose-based biomass to produce
ethanol. If we are unable to produce ethanol as cost-effectively as
cellulose-based producers, our ability to generate revenue and our financial
condition will be negatively impacted.  New plants under
construction or decreases in the demand for ethanol may result in excess
production capacity in our industry.The supply of domestically produced
ethanol is at an all-time high. According to the Renewable Fuels Association, as
of March 5, 2009, there are 193 ethanol plants operating in the United States
with capacity to produce more than approximately 12.4 billion gallons of
ethanol per year. The Renewable Fuels Association has reported that
approximately 16% of that production capacity is not currently operational.
Others estimate that 20% or more of the nations ethanol production capacity is
currently idle.  In addition, there are 23 new ethanol plants under
construction and approximately 3 plant expansions underway which together are
estimated to increase ethanol production capacity by more than 2 billion
gallons per year.  Excess ethanol production capacity may have an adverse
impact on our results of operations, cash flows and general financial condition.
If the demand for ethanol does not grow at the same pace as increases in supply,
we expect the selling price of ethanol to decline. If excess capacity in the
ethanol industry occurs, the market price of ethanol may decline to a level that
is inadequate to generate sufficient cash flow to cover our costs. This could
negatively affect our future profitability.  23  Decreasing gasoline prices may negatively impact the selling
price of ethanol which could reduce our ability to operate profitably.
The price of ethanol tends to change in relation to the price of gasoline.
Recently, as a result of a number of factors including a slowing world economy,
the price of gasoline has decreased. In correlation to the decrease in the price
of gasoline, the price of ethanol has also decreased. Decreases in the price of
ethanol reduce our revenue. Our profitability depends on a favorable spread
between our corn and natural gas costs and the price we receive for our ethanol.
If ethanol prices fall during times when corn and/or natural gas prices are
high, we may not be able to operate our ethanol plant profitably.  Growth in the
ethanol industry is dependent on growth in the fuel blending infrastructure to
accommodate ethanol, which may be slow and could result in decreased demand for
ethanol.The ethanol industry depends on the fuel blending industry to
blend the ethanol that is produced with gasoline so it may be sold to the end
consumer. In many parts of the country, the blending infrastructure cannot
accommodate ethanol so no ethanol is used in those markets. Substantial
investments are required to expand this blending infrastructure and the fuel
blending industry may choose not to expand the blending infrastructure to
accommodate ethanol. Should the ability to blend ethanol not expand at the same
rate as increases in ethanol supply, it may decrease the demand for ethanol.
Should the fuel blending industry not make the required investments to expand
the blending infrastructure, it may lead to a decrease in the selling price of
ethanol which could impact our ability to operate profitably.  We operate in an
intensely competitive industry and compete with larger, better financed entities
which could impact our ability to operate profitably.There is
significant competition among ethanol producers. There are numerous
producer-owned and privately-owned ethanol plants planned and operating
throughout the Midwest and elsewhere in the United States. We also face
competition from outside of the United States. The number of ethanol plants
being developed and constructed in the United States continues to increase at a
rapid pace. The passage of the Energy Policy Act of 2005 included a renewable
fuels mandate. The Energy Independence and Security Act of 2007 increased the
RFS to 36 billion gallons by 2022. Further, some states have passed
renewable fuel mandates. These increases in ethanol demand have encouraged
companies to enter the ethanol industry. The largest ethanol producers include
POET, Archer Daniels Midland, VeraSun Energy Corporation and Hawkeye Renewables,
LLC, all of which are each capable of producing more ethanol than we produce.
 However, VeraSun recently filed for Chapter 11 Bankruptcy and has
announced that it intends to auction off all of its ethanol plants by
March 31, 2009. Other ethanol producers may be in a position to purchase
the assets of VeraSun which could further consolidate the ethanol industry.
 Certain other ethanol producers have also filed for bankruptcy.  The
purchase of the assets of these other ethanol producers may also result in
further consolidation in the ethanol industry.  We may not be able to
compete with these larger entities. These larger ethanol producers may be able
to affect the ethanol market in ways that are not beneficial to us which could
affect our financial performance.  Competition from
the advancement of alternative fuels may lessen the demand for ethanol.
Alternative fuels, gasoline oxygenates and ethanol production methods are
continually under development. A number of automotive, industrial and power
generation manufacturers are developing alternative clean power systems using
fuel cells or clean burning gaseous fuels. Like ethanol, the emerging fuel cell
industry offers a technological option to address increasing worldwide energy
costs, the long-term availability of petroleum reserves and environmental
concerns. Fuel cells have emerged as a potential alternative to certain existing
power sources because of their higher efficiency, reduced noise and lower
emissions. Fuel cell industry participants are currently targeting the
transportation, stationary power and portable power markets in order to decrease
fuel costs, lessen dependence on crude oil and reduce harmful emissions. If the
fuel cell and hydrogen industries continue to expand and gain broad acceptance,
and hydrogen becomes readily available to consumers for motor vehicle use, we
may not be able to compete effectively. This additional competition could reduce
the demand for ethanol, resulting in lower ethanol prices that might adversely
affect our results of operations and financial condition.  Consumer
resistance to the use of ethanol based on the belief that ethanol is expensive,
adds to air pollution, harms engines and/or takes more energy to produce than it
contributes may affect the demand for ethanol.Certain individuals
believe that use of ethanol will have a negative impact on gasoline prices at
the pump. Many also believe that ethanol adds to air pollution and harms car and
truck engines. Still other consumers believe that the process of producing
ethanol actually uses more fossil energy, such as oil and natural gas, than the
amount of energy that is produced. These consumer beliefs could potentially be
wide-spread. If consumers choose not to buy ethanol based on those beliefs, it
would affect the demand for the ethanol we produce which could negatively affect
our profitability and financial condition.  24   Negative media attention associated with the use of corn in
the ethanol production process may lead to decreases in demand for the ethanol
we produce which could negatively affect our profitability.Recent media
attention associated with the use of corn as the feedstock in ethanol production
has been unfavorable to the ethanol industry. This negative media attention has
focused on the effect ethanol production has on domestic and foreign food
prices. While some recent media reports have recognized that food prices have
remained high despite significant decreases in the price of corn following peaks
in July 2008, some of this negative perception of ethanol production may
persist. Ethanol production has previously received favorable coverage by the
news media which may have increased demand for ethanol. This negative perception
of ethanol production may have a negative effect on demand for ethanol which may
decrease the price we receive for our ethanol. Decreases in the selling price of
ethanol may have a negative effect on our financial condition.  Risks Related to Regulation and
Governmental Action  Government
incentives for ethanol production, including federal tax incentives, may be
eliminated in the future, which could hinder our ability to operate at a profit.The ethanol industry is assisted by various federal ethanol production
and tax incentives, including the RFS set forth in the Energy Policy Act of 2005
and increased by the Energy Independence and Security Act of 2007. The RFS helps
support a market for ethanol that might disappear without this incentive; as
such, waiver of the RFS minimum levels of renewable fuels included in gasoline
could negatively impact our results of operations.  In addition, the
elimination or reduction of tax incentives to the ethanol industry, such as the
Volumetric Ethanol Excise Tax Credit (VEETC) available to gasoline refiners
and blenders, could also reduce the market demand for ethanol, which could
reduce prices and our revenues by making it more costly or difficult for us to
produce and sell ethanol. If the federal tax incentives are eliminated or
sharply curtailed, we believe that decreased demand for ethanol will result,
which could negatively impact our ability to operate profitably.  Also, elimination of the
tariffs that protect the United States ethanol industry could lead to the
importation of ethanol from producers in other countries, especially in areas of
the United States that are easily accessible by international shipping ports.
While the 2008 Farm Bill extended the tariff on imported ethanol through 2011,
this tariff could be repealed earlier which could lead to increased ethanol
supplies and decreased ethanol prices.  Changes in
environmental regulations or violations of the regulations could be expensive
and reduce our profitability.We are subject to extensive air, water and
other environmental laws and regulations. In addition, some of these laws
require our plant to operate under a number of environmental permits. These
laws, regulations and permits can often require expensive pollution control
equipment or operation changes to limit actual or potential impacts to the
environment. A violation of these laws and regulations or permit conditions can
result in substantial fines, damages, criminal sanctions, permit revocations
and/or plant shutdowns. In the future, we may be subject to legal actions
brought by environmental advocacy groups and other parties for actual or alleged
violations of environmental laws or our permits. Additionally, any changes in
environmental laws and regulations, both at the federal and state level, could
require us to spend considerable resources in order to comply with future
environmental regulations. The expense of compliance could be significant enough
to reduce our profitability and negatively affect our financial condition.  Carbon dioxide may
be regulated in the future by the EPA as an air pollutant, which would require
us to obtain additional permits and install additional environmental mitigation
equipment, which could adversely affect our financial performance.In
2007, the United States Supreme Court decided a case in which it ruled that
carbon dioxide is an air pollutant under the Clean Air Act for the purposes of
motor vehicle emissions. The Supreme Court directed the EPA to regulate carbon
dioxide from vehicle emissions as a pollutant under the Clean Air Act. Similar
lawsuits have been filed seeking to require the EPA to regulate carbon dioxide
emissions from stationary sources such as our ethanol plant under the Clean Air
Act. Our plant produces a significant amount of carbon dioxide that we currently
vent into the atmosphere. While there are currently no regulations applicable to
us concerning carbon dioxide, if the EPA or the State of Wisconsin were to
regulate carbon dioxide emissions by plants such as ours, we may have to apply
for additional permits or we may be required to install carbon dioxide
mitigation equipment or take other as yet unknown steps to comply with these
potential regulations. Compliance with any future regulation of carbon dioxide,
if it occurs, could be costly and may prevent us from operating the ethanol
plant profitably which could decrease or eliminate the value of our membership
units.  25  ITEM 2.  PROPERTIES.  Our ethanol plant is
located on an approximately 115-acre site on Wisconsin Highway 33, two miles
east of Wisconsin Highway 73.  The plants address is W1231 Tessmann Drive,
Friesland, Wisconsin 53935.  We produce all of our ethanol and distillers
grains at this site.  The ethanol plant has the capacity to produce
approximately 60 million gallons of ethanol per year.  The ethanol plant
consists of the following buildings and equipment:  · An ethanol production
system, which is comprised of a mixing system, cooker, liquefaction vessels,
fermentors, beer well vessel, distillation system, and alcohol driers. 
This equipment is arranged in and around the process and production building,
which also houses the electrical and process control center, control room,
maintenance facilities, staff facilities, and operations management offices; · Ethanol and denaturant
storage tanks; · An energy building,
which contains our natural gas burning equipment and distillers grains
dryers; · A waste mash processing
system; · A fire protection
system; · A dry bulk products
shipping and receiving facility; · A cooling tower
installation; · An administration and
sales office building with furniture and equipment; · A maintenance building,
which also includes offices, a workout room and break area; and · Transportation
facilities, including truck and rail ethanol load out stations.  The site also includes
improvements such as rail tracks and rail switches, landscaping, drainage
systems and paved access roads.  Our revolving line of
credit with Farmers & Merchants Union Bank is secured by substantially all
of our assets.  As of December 31, 2008, we had no borrowings against our
line of credit.  Our revolving line of credit is discussed in more detail
under MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION  Short-Term and Long-Term Debt Sources.  ITEM 3.  LEGAL PROCEEDINGS.  From time to time in the
ordinary course of business, we may be named as a defendant in legal proceedings
related to various issues, including without limitation, workers compensation
claims, tort claims, or contractual disputes.  We are not currently
involved in any material legal proceedings, directly or indirectly, and we are
not aware of any claims pending or threatened against us or any of the directors
that could result in the commencement of material legal proceedings.  ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF
SECURITY HOLDERS.  We did not submit any
matter to a vote of our unit holders through the solicitation of proxies or
otherwise during the fourth quarter of 2008.  26   PART II  ITEM 5.  MARKET FOR REGISTRANTS MEMBERSHIP
UNITS, RELATED MEMBER MATTERS AND ISSUER PURCHASES OF MEMBERSHIP UNITS.  Market Information  There is no public
trading market for our membership units.  However, we have created a
private qualified online matching service in order to facilitate trading of our
membership units.  Our online matching service has been designed to comply
with federal tax laws and regulations establishing a qualified matching
service, as well as state and federal securities laws.  Our online
matching service consists of an electronic bulletin board that provides lists of
interested sellers and interested buyers, along with non-firm price
quotations.  We do not receive any compensation for creating or maintaining
the matching service.  We do not become involved in any purchase or sale
negotiations arising from our qualified matching service.  In advertising
our qualified matching service, we do not characterize the Company as being a
broker or dealer or an exchange.  We do not give advice regarding the
merits or shortcomings of any particular transaction.  We do not receive,
transfer or hold funds or securities as an incident of operating the online
matching service.  We do not use the bulletin board to offer to buy or sell
securities other than in compliance with the securities laws, including any
applicable registration requirements.  We have no role in effecting the
transactions beyond approval, as required under our operating agreement and the
issuance of new certificates.  There are detailed timelines that must be
followed under the matching service with respect to offers and sales of
membership units.  All transactions must comply with the qualified matching
service terms and conditions, rules, our operating agreement, and are subject to
approval by our board of directors.  The qualified matching service
rules and terms and conditions are available on our website,
www.uwgp.com.  The following table
contains historical information by quarter for the past two years regarding the
actual unit transfers that were completed by the Companys unit-holders during
the periods specified.  The Company believes this most accurately
represents the current trading value of the Companys membership units. 
The information was compiled by reviewing the completed unit transfers that
occurred on our qualified online matching service during the quarters
indicated.  Quarter

Low Price

High Price

Average Price

# of MembershipUnits
TradedOct 1  Dec 31 2008

$
2,000.00

$
2,250.00

$
2,050.00

50July 1  Sept 30 2008

$
2,000.00

$
2,000.00

$
2,000.00

15Apr 1  June 30 2008

$
2,750.00

$
2,850.00

$
2,783.33

30Jan 1  March 31 2008

$
2,950.00

$
2,950.00

$
2,950.00

20Oct 1  Dec 31 2007

$
2,300.00

$
3,100.00

$
2,516.89

148July 1  Sept 30 2007

$
3,000.00

$
3,375.00

$
3,152.17

150Apr 1  June 30 2007

$
3,000.00

$
3,200.00

$
3,190.00

40Jan 1  March 31 2007

$
3,000.00

$
3,555.00

$
3,312.92

120  As a limited liability
company, we are required to restrict the transfers of our membership units in
order to preserve our partnership tax status.  Our membership units may not
be traded on any established securities market or readily traded on a secondary
market (or the substantial equivalent thereof).  All transfers are subject
to a determination that the transfer will not cause us to be deemed a publicly
traded partnership.  Unit Holders  As of March 1, 2009, we
had 28,475 membership units issued and outstanding and approximately 907 holders
of record of our membership units.  There is no other class of membership
units issued or outstanding.   27  Distributions  Our Board of Directors
has complete discretion over the timing and amount of distributions to our unit
holders; however, our operating agreement requires the Board of Directors to
endeavor to make cash distributions at such times and in such amounts as will
permit our unit holders to satisfy their income tax liability in a timely
fashion.  In addition, distributions are restricted by certain covenants in
our revolving line of credit.  These loan covenants and restrictions are
described in greater detail under MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATION  Short-Term and Long-Term Debt
Sources.  There can be no assurances as to our ability to declare or
pay distributions in the future or that past distributions (described below)
will be indicative of future distributions.  Distributions by the
Company to our unit holders are in proportion to the number of membership units
held by each membership unit holder.  A membership unit holders
distribution is determined by dividing the number of membership units owned by
such membership unit holder by the total number of membership units
outstanding.  On January 12, 2009, our
Board of Directors declared a cash distribution of $100.00 per membership unit,
for a total distribution of $2,847,500.  The distribution was made to unit
holders of record as of January 12, 2009. The distribution was paid in February
2009.  Additionally, we made the following distributions during our last
two fiscal years, ended December 31, 2007 and 2008.  2008 Distributions  On January 10, 2008, our
Board of Directors declared a cash distribution of $250.00 per membership unit,
for a total distribution of $7,175,000.  The distribution was made to unit
holders of record as of January 10, 2008. The distribution was paid in February
2008.  On July 14, 2008, our
Board of Directors declared a cash distribution of $200.00 per membership unit,
for a total distribution of $5,695,000.  The distribution was made to unit
holders of record as of July 14, 2008. The distribution was paid in August
2008.  2007 Distributions  On January 9, 2007, our
Board of Directors declared a cash distribution of $500.00 per membership unit,
for a total distribution of $14,390,000.  The distribution was made to unit
holders of record as of January 9, 2007. The distribution was paid in February
2007.  On July 10, 2007, our
Board of Directors declared a cash distribution of $136.00 per membership unit,
for a total distribution of $3,914,080.  The distribution was made to unit
holders of record as of July 10, 2007. The distribution was paid in August
2007.  Issuer Purchases of Equity
Securities  We did not repurchase
any of our equity securities during the fourth quarter of our 2008 fiscal
year.  Performance Graph  The following graph
shows a comparison of cumulative total member return since October 31,
2005, calculated on a dividend reinvested basis, for the Company, the NASDAQ
Composite Index (the NASDAQ) and an index of other companies that have the
same SIC code as the Company (the Industry Index). The graph assumes $100 was
invested in each of the Companys membership units, the NASDAQ, and the Industry
Index on October 31, 2005. Data points on the graph are annual. Note that
historic stock price performance is not necessarily indicative of future unit
price performance.  Pursuant to the
rules and regulations of the Securities and Exchange Commission, the
performance graph and the information set forth therein shall not be deemed to
be filed for purposes of Section 18 of the Securities Exchange Act of 1934,
and shall not be deemed to be incorporated by reference in any filing under the
Securities  28   Act of 1933, as
amended, or the Exchange Act, except as shall be expressly set forth by specific
reference in such a filing.       29   ITEM 6.  SELECTED
FINANCIAL DATA  The following table sets
forth selected consolidated financial data of the Company, which is derived from
the audited financial statements for the periods indicated.  The
information below is only a summary.  This information should be read in
conjunction with Item 7 -- Managements Discussion and Analysis of Financial
Condition and Results of Operations and our audited financial statement
included in this annual report.  Our past performance may not be indicative
of future financial condition or results of operations for many reasons,
including the risks described in Item 1A -- Risk Factors and elsewhere
in this annual report.  The Company commenced operations in May 2005.
 In December 2007, the Company substantially completed an expansion that
increased the plants nameplate production capacity from 40 million gallons per
year to approximately 60 million gallons of ethanol per year.  Statement of Operations Data:
2008
2007
2006
2005
2004Revenues
$139,335,829
$111,736,700
$111,366,602
$ 54,477,045
$
                 -Cost of Goods Sold
$124,324,267
$  87,374,742
$  67,490,129
$ 43,643,191
$
                 -Gross Profit
$  15,011,562
$  24,361,958
$  43,876,473
$ 10,833,854
$
                 -Operating Expenses
$    2,971,173
$    3,151,166
$    2,970,684
$   2,286,229
$      718,431Operating Income (Expense)
$  12,040,389
$  21,210,792
$  40,905,789
$   8,547,625
$   (718,431)Other Income (Expense)
$    (461,837)
$
        31,440
$    (887,940)
$   2,187,770
$       (1,731)Net Income (Expense)
$  11,578,552
$ 21,242,232
$ 40,017,849
$ 10,735,395
$   (720,162)Weighted Average Units
Outstanding
28,520
28,767
28,780
28,780
28,270Net Gain (Loss) Per Unit
$405.98
$738.42
$1,390.47
$373.02
$(25.47)Cash Distributions Per Unit
$451.26
$636.29
$400.00
$
     -
$     -Balance Sheet Data:
2008
2007
2006
2005
2004Net Property, Plant &
Equipment
$54,388,503
$51,625,090
$47,364,224
$49,891,372
$43,076,408Total Assets
$71,772,871
$86,538,195
$84,946,319
$64,915,892
$44,253,414Long-Term Debt, less current
maturities
$
                 -
$13,097,887
$14,349,890
$22,074,722
$
      77,723Members Equity
$66,159,166
$68,128,414
$65,413,512
$36,907,663
$26,172,268Units Outstanding at End of
Year
28,475
28,710
28,780
28,780
28,780Book Value Per Capital Unit
$    2,323.41
$    2,372.99
$    2,272.88
$    1,282.41
$
      909.39  ITEM 7.  MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.    Except for historical
information, the following discussion contains forward-looking statements that
are subject to risks and uncertainties.  We caution you not to put undue
reliance on any forward-looking statements, which speak only as of the date of
this report.  Our actual results or actions may differ materially from
these forward-looking statements for many reasons, including the risks described
in Item 1ARisk Factors and elsewhere in this annual report.  Our
discussion and analysis of our financial condition and results of operations
should be read in conjunction with the financial statements and related notes
and with the understanding that our actual future results may be materially
different from what we currently expect.  30  Results of
Operations  Comparison of Fiscal Years Ended
December 31, 2008 and 2007  The following table
shows the results of our operations and the percentage of revenues, cost of
goods sold, operating expenses and other items to total revenues in our
statement of operations for our fiscal years ended December 31, 2008 and 2007:  2008

2007Statement of Operations
Data

Amount

%

Amount

%Revenues

$
139,335,829

100.0

$
111,736,700

100.0Cost of Goods Sold
(1)

$
124,324,267

89.2

$
87,374,742

78.2Gross Profit

$
15,011,562

10.8

$
24,361,958

21.8Operating Expenses

$
2,971,173

2.1

$
3,151,166

2.8Operating Income

$
12,040,389

8.6

$
21,210,792

19.0Other Income (Expense)

$
(461,837)

0.3

$
31,440

0.0Net Income

$
11,578,552

8.3

$
21,242,232

19.0(1) 2008 Includes lower of cost or market
adjustment of $1,208,962, which decreased inventory and increased costs of
goods sold.  Revenues.
 Revenues from operations for the fiscal year ended December 31, 2008
increased by approximately 25% over our previous fiscal year ended December 31,
2007.  In the fiscal year ended December 31, 2008, ethanol sales comprised
approximately 85% of our revenues and distillers grain sales comprised
approximately 15% of our revenues.  Ethanol sales comprised approximately
88% and distillers grains sales comprised approximately 12% of our revenues for
fiscal year ended December 31, 2007.  The 25% increase in revenues for the
fiscal year ended December 31, 2008 as compared to the previous fiscal year is
primarily a result of increased ethanol and distillers grains prices as compared
to the previous year.  Our volume of ethanol
sold increased by approximately 0.3% in the fiscal year ended December 31, 2008
as compared to the fiscal year ended December 31, 2007.  We substantially
completed an expansion that increased our production capacity to 60 million
gallons per year in December 2007.  We began operating at this expanded
capacity in July 2008; however, in September 2008 we began operating at less
than full capacity due to tightening industry margins.  This led to only a
slight increase in our volume of ethanol sold in 2008 as compared to 2007.  The average price of
ethanol in the fiscal year ended December 31, 2008 was up approximately 21% from
the average price for the fiscal year ended December 31, 2007.  Management
attributes this ethanol price increase to an overall increase in commodity
prices in general, and more specifically to high corn prices and high gasoline
prices.  Ethanol prices have recently declined from their record highs in
July 2008, following the decline in the price of corn and gasoline.
 Management currently expects short-term and mid-term ethanol prices to
continue to follow the price of corn and/or gasoline. Management believes demand
for ethanol will continue to be supported by the economic incentive for gasoline
blenders to blend ethanol and the Renewable Fuel Standards ethanol blending
requirement.  However, management believes the industry will need to
continue to grow demand in order to increase or sustain current prices.
 According to the Renewable Fuels Association, as of March 5, 2009 there
were 193 ethanol plants nationwide with the name-plate capacity to produce
approximately 12.4 billion gallons of ethanol annually.  The Renewable
Fuels Association has reported that approximately 16% of that production
capacity is not currently operational. Others estimate that 20% or more of the
nations ethanol production capacity is currently idle.  There are an
additional 23 new plants and 3 expansions under construction expected to add an
additional estimated 2 billion gallons of annual production capacity in the next
12 to 18 months.  Unless this new supply is equally met with increased
demand, ethanol prices may be pressured downward.  If ethanol prices
continue to decline, our earnings will also decline, particularly if corn prices
remain substantially higher than historic averages. 31   The price we received for ethanol has been decreasing in
conjunction with recent decreases in the market price of gasoline and the market
price of corn.  Management anticipates that the price of gasoline will
remain low in the near term, especially as a result of the weakening world
economy.  Management also anticipates that our results of operations for
our 2009 fiscal year will continue to be affected by higher than historical
average corn prices, a surplus of ethanol, low ethanol prices, and volatility in
the commodity markets.  As a result of these factors, management
anticipates that the ethanol plant will operate at less than full capacity and
will not operate profitably in the early part of 2009.  If the price of
ethanol remains low for an extended period of time, management anticipates that
this could have a negative impact on our liquidity, especially if our raw
material costs continue to increase.  We anticipate that the price of
distillers grains will continue to fluctuate in reaction to changes in the price
of corn and therefore we expect lower distillers grains prices in the near term.
 The ethanol industry needs to continue to expand the market for distillers
grains in order to maintain current distillers grains prices.  For 2008, based on
demand trends and reported ethanol demand from the Renewable Fuels Association,
demand for ethanol exceeded over 9.5 billion gallons.  This is a
significant increase over recent years.  However, in order to continue to
increase demand for ethanol, the industry needs to pursue additional ethanol
blending and distribution infrastructure as well as higher percentage blends of
ethanol.  Many parts of the United States do not blend any ethanol into
gasoline because of a lack of the infrastructure necessary to do so.  In
order to continue to increase demand for ethanol, investments in blending and
transportation infrastructure are necessary so that ethanol can reach every
market in the United States.  Further, higher blends of ethanol should be
pursued.  While we anticipate experiencing some increased ethanol demand as
a result of an increase in the use of E85 (85% ethanol and 15% gasoline) in
flexible fuel vehicles, we anticipate that a greater demand increase would
result from the availability of blends such as E20 (20% ethanol and 80%
gasoline) in areas that are already using E10 in standard automobiles.
 Management anticipates stronger ethanol demand and higher ethanol prices
during the summer months due to a seasonal increase in the demand for gasoline
and ethanol.  Our revenues include a
gain of $1,905,800 for fiscal year ended December 31, 2008 and a loss of
$1,221,000 for the fiscal year ended December 31, 2007, related to our ethanol
derivative instruments.  We recognize the gains or losses that result from
the changes in the value of our ethanol-related derivative instruments in
revenues as the changes occur.  As ethanol prices fluctuate, the value of
our ethanol-related derivative instruments changes, affecting our financial
results.  We expect the volatility in these derivative instruments to
continue to have an effect on our revenues due to the timing of the changes in
the value of the derivative instruments relative to our sales.   These
instruments are the primary tools of our risk management program for ethanol
revenues.  At December 31, 2008, the Company had forward contracts to sell
9 million gallons of ethanol for various delivery periods from January 2009
through June 2009.  The prices on these contracts range from $1.65 to $1.98
per gallon or have a basis level established by the Oil Price Information
Service (OPIS) Chicago ethanol market between -$0.07 and -$0.08.  During the fiscal year
ended December 31, 2008, our tons of distillers grains sold increased
approximately 1.7% as compared to the fiscal year ended December 31, 2007.
 The sales prices for our distillers grains for the fiscal year ended
December 31, 2008 were up 31% from the fiscal year ended December 31, 2007.
 During the fiscal year ended December 31, 2008, the rising cost of corn
and other alternative feed sources pushed distillers grains prices upward.
 However, more recently, decreased corn prices and decreased demand from
export markets has placed downward pressure on distillers grains prices.
 Distillers grains prices are expected to follow the price of corn for the
foreseeable future unless the price of soybean meal or other protein sources
changes significantly.  Additionally, an increased supply of distillers
grains resulting from additional ethanol production may put downward pressure on
distillers grains prices.  At December 31, 2008,
the Company had forward dry distillers grains contracts totaling 10,400 ton for
various delivery periods from January to September 2009 with a price range of
$110 to $170 per ton, and forward modified wet distillers grains sales contracts
totaling 6,700 ton for various delivery periods from January 2009 to May 2009
with a price range of $50 to $77 per ton.  In the future, we expect
to derive additional revenues from the extraction and sale of corn oil.  We
expect to complete our corn oil extraction project, and begin marketing corn
oil, in our second fiscal quarter in 2009.  See Plant Expansion and
Construction in Process below for additional details regarding our corn oil
extraction project.  32  Cost of Goods Sold.  Our cost of goods sold
from the production of ethanol and distillers grains is primarily made up of raw
grains expenses (corn) and energy expenses (natural gas and electricity).
 Cost of goods sold for the fiscal year ended December 31, 2008 totaled $124,324,267 as compared to
$87,374,742 for the fiscal year ended December 31, 2007.  The 42% increase
in cost of goods sold in the fiscal year ended December 31, 2008 as compared to
the same period in 2007 is primarily a net result of a 57% increase in the cost
of corn, 68% increase in the cost of natural gas and a lower of cost or market
adjustment of $1,208,962, partially offset by a $3,324,800 gain related to our
corn derivative instruments discussed below.  Our average price of
corn for the fiscal year ended December 31, 2008 was 54% higher than our average
for the fiscal year ended December 31, 2007.  Additionally, we used
approximately 2% more corn in the fiscal year ended December 31, 2008 as
compared to the fiscal year ended December 31, 2007.  Corn prices remain
higher than historical averages but have continued to trend lower since peaking
in mid-summer 2008.  The commodity markets have been weakened due to
concerns surrounding the global economic slowdown.  Additionally, recent
crop production reports indicate a potentially larger corn inventory than
earlier anticipated due to lower exports, lower domestic demand than expected
earlier this year, and the second largest corn crop on record in the fall of
2008.  Continued pressure on ethanol margins may further reduce the
domestic demand for corn.  These factors may lead to continued downward
pressure on corn prices.  However, we expect our cost of feedstock to
continue to remain higher than historic levels.  We do not anticipate that
we will have difficulty securing the corn that we require to continue to operate
our ethanol plant during our 2009 fiscal year; however, if a shortage of corn
were to develop, we expect our corn costs would increase significantly.  Our cost of goods sold
includes a loss of $1,208,962 for the fiscal year ended December 31, 2008
related to a lower of cost or market adjustment as compared to no gain or loss
for the fiscal year ended December 31, 2007.  The Company performed a lower
of cost or market analysis on inventory and determined that the market values of
certain inventories were less than their carrying value, attributable primarily
to decreases in market prices of corn and ethanol. Based on the lower of cost or
market analysis, the Company recorded a lower of cost or market charge on
certain inventories of approximately $150,000 and $0, respectively, for the
years ended December 31, 2008 and 2007.  Additionally, at December 31,
2008, the Company had forward corn purchase contracts totaling 2.7 million
bushels for various delivery periods from January 2009 to December 2009.
 Currently, some of these contract prices are above current market prices
for corn. Given declining corn and ethanol prices, upon taking delivery under
these contracts, the Company would incur a loss. Accordingly, the Company
recorded a lower of cost or market charge on these purchase commitments of
approximately $1,059,000 for the year ended December 31, 2008, and $0 for the
year ended December 31, 2007.  Given the uncertainty of future corn and
ethanol prices, this loss may not be recovered, and further losses on the
outstanding purchase commitments could be recorded in future periods.  Our cost of goods sold
also includes a gain of $3,324,800 for the fiscal year ended December 31, 2008
related to our corn derivative instruments as compared to a $255,300 gain for
the fiscal year ended December 31, 2007.  We recognize the gains or losses
that result from the changes in the value of our corn-related derivative
instruments in cost of goods sold as the changes occur.  As corn prices
fluctuate, the value of our derivative instruments changes, which affects our
financial performance.  We anticipate continued volatility in our cost of
goods sold due to the timing of the changes in value of the derivative
instruments relative to the cost and use of the commodity being hedged. 
 These instruments are the primary tools of our risk management program for
corn prices.  At December 31, 2008, the Company had forward corn purchase
contracts totaling 2.7 million bushels for various delivery periods from January
2009 to December 2009, of which approximately 30% are with members.  The
prices on these contracts range from $3.10 to $6.73 per bushel or have a basis
level established by the CBOT futures between $-0.05 and $-0.28.  Natural gas is also an
important input to our manufacturing process.  The price of our natural gas
increased 37% for the fiscal year ended December 31, 2008 as compared to the
same period in 2007.  The volume of natural gas we used in the fiscal year
ended December 31, 2008 was down 1% from the fiscal year ended December 31,
2007. The increase in price and decrease in volume required resulted in a 35%
net increase in the cost of natural gas in the fiscal year ended December 31,
2008 as compared to the same period in 2007. We estimate that our natural gas
usage is approximately 140,000 million British thermal units (MMBTU) per month
when operating at a production rate of 60 million gallons per year.  We use
natural gas to dry or partially dry our distillers grains products to moisture
contents at which they can be stored for longer periods and transported greater
distances, so that we can market them to broader livestock markets, including
poultry and swine markets in the continental United States and to markets in
Asia.  Over the past two to three years natural gas has been available only
at prices  33  exceeding
historical averages. These heightened prices increase our costs of
production.  Although natural gas prices have declined from their recent
peak in July, they remain higher than historical averages and we expect natural
gas prices will remain volatile into the near future as a result of instability
in energy prices generally.  If natural gas prices increase relative to
historical average levels, it will continue to have a negative impact on our
cost of goods sold. We have secured a marketing firm and energy consultant for
our natural gas supply and will continue to work with them on an ongoing basis
to mitigate our exposure to volatile gas prices.   We have secured
firm pipeline capacity for natural gas delivery of 4,000 MMBTU per day and are
working towards securing additional pipeline capacity to accommodate our
planned, but indefinitely delayed, expansion.  At December 31, 2008,
the Company had forward contracts to purchase approximately 400,000 million
British thermal units (MMBTU) of natural gas during the months of January
through June 2009 at an average price of approximately $7.85 per MMBTU.  Gross
Profit.  Gross profit for fiscal year ended December 31, 2008 was
$15,011,562, a 38% decrease from the gross profit of $24,361,958 for the fiscal
year ended December 31, 2007.  This decrease is due to the 57% increase in
the cost of corn, the 35% increase in the cost of natural gas and the lower of
cost or market adjustment of $1,208,962 (see Cost of Goods Sold above),
partially offset by a $3,324,800 gain recognized from our corn derivative
instruments, the 21% increase in the price of ethanol, the 31% increase in the
price of distillers grains, and the $1,905,800 gain recognized from our ethanol
derivative instruments (see Revenues above).  In the fiscal year ended
December 31, 2008, our ethanol-corn price spread was approximately $1.40, as
compared to a spread of approximately $2.16 for the fiscal year ended December
31, 2007, a 54% decrease.  This decrease in the corn-ethanol spread,
coupled with our increase in natural gas costs, partially offset by the hedge
gain we recognized in the fiscal year ended December 31, 2008, resulted in a
gross profit of $15,011,562, or 11% of sales, as compared to a gross profit of
22% of sales for the fiscal year ended December 31, 2007.  We calculate our
spread as the price we receive per gallon of ethanol, multiplied by the number
of gallons of ethanol produced per bushel of corn, minus the price we paid per
bushel of corn.  The calculation of our spread does not take into account
sales of distillers grains or expenses from inputs other than corn, including
the natural gas we use to dry our distillers grains.  The spread between
the price we receive for our products and the costs of our raw materials may
continue to decrease in the future.  The rapidly increasing supply of
ethanol may continue to outpace the demand for ethanol, placing additional
downward pressure on our selling price and further eroding our margins.
 The increased production of ethanol from corn in the industry may
contribute to increased demand for corn.  This increased demand may exceed
the available supply of corn, thus increasing our costs for corn and reducing
our profit margin.  A decrease in profit margin will adversely affect our
financial performance.  Operating
Expenses.  Operating expenses were $2,971,173 for the fiscal year
ended December 31, 2008 as compared to $3,151,166 for the fiscal year ended
December 31, 2007.  Operating expenses as a percentage of revenues were
2.1% and 2.8% for fiscal years ended December 31, 2008 and December 31, 2007,
respectively.  Operating Income
(Loss).  Operating income for the fiscal year ended December 31,
2008 totaled $12,040,389, or 9% of revenues.  Operating income for the
fiscal year ended December 31, 2007 totaled $21,210,792, or 19% of revenues.
 The decrease in operating income for the fiscal year ended December 31,
2008 compared to the fiscal year ended December 31, 2007 is primarily a result
of the net decrease in Gross Profit discussed above.  Other Income
(Expense).  Our other income (expense) for the fiscal year ended
December 31, 2008 was an expense of $461,837 as compared to income of $31,440
for the fiscal year ended December 31, 2007.  Our other income (expense)
items for the fiscal years ended December 31, 2008 and December 31, 2007
consisted primarily of interest income, interest expense and net miscellaneous
income.  Our decrease in interest expense is attributable to the retirement
of our long-term debt in April 2008.  Our decrease in interest income is
the result of utilizing previously interest-bearing cash to retire our debt.  34  Comparison
of Fiscal Years Ended December 31, 2007 and 2006  The following table
shows the results of our operations and the percentage of revenues, cost of
goods sold, operating expenses and other items to total revenues in our
statement of operations for fiscal years ended December 31, 2007 and 2006:  2007

2006Statement of Operations
Data

Amount

%

Amount

%Revenues

$
111,736,700

100.0

$
111,366,602

100.0Cost of Goods Sold

$
87,374,742

78.2

$
67,490,129

60.6Gross Profit

$
24,361,958

21.8

$
43,876,473

39.4Operating Expenses

$
3,151,166

2.8

$
2,970,684

2.7Operating Income

$
21,210,792

19.0

$
40,905,789

36.7Other Income (Expense)

$
31,440

0.0

$
(887,940)

(0.8)Net Income

$
21,242,232

19.0

$
40,017,849

35.9  Revenues.
 Revenues from operations for the fiscal year ended December 31, 2007 were
relatively unchanged from the previous fiscal year ended December 31, 2006.
 In the fiscal year ended December 31, 2007 our revenues totaled
$111,736,700, of which ethanol comprised 88% of our revenues and distillers
grain sales comprised 12%. In the fiscal year ended December 31, 2006 our
revenues totaled $111,366,602, of which ethanol comprised 90% of our revenues
and distillers grain sales comprised 10%.  The sales price of our
ethanol in the fiscal year ended December 31, 2007 was down approximately
5% from the price for the fiscal year ended December 31, 2006.  The
sales price for our distillers grains for the fiscal year ended
December 31, 2007 increased approximately 26% from the fiscal year ended
December 31, 2006.  Our revenues include a loss of $1,221,061 for the
fiscal year ended December 31, 2007 related to our ethanol derivative
instruments, as compared to no gain or loss for the fiscal year ended December
31, 2006.  We recognize the gains or losses that result from the changes in
the value of our ethanol-related derivative instruments in revenues as the
changes occur.  As ethanol prices fluctuate, the value of our
ethanol-related derivative instruments changes, affecting our financial
performance.  Cost of Goods
Sold.  Our cost of goods sold for the fiscal year ended December
31, 2007 totaled $87,374,742 or 78% of revenues, as compared to $67,490,129, or
61% of revenues for the fiscal year ended December 31, 2006.  The 30%
increase in cost of goods sold for the fiscal year ended December 31, 2007 as
compared to the fiscal year ended December 31, 2006 is a net result of a 46%
increase in the cost of corn and other ingredients and a 16% increase in
electricity, partially offset by a 10% decrease in the cost of production labor
and an 8% decrease in the cost of natural gas.  Our decreased cost of
production labor is primarily the result of decreased costs in connection with
our high earnings reward profit-sharing program.  Our cost of goods sold
includes a gain of $255,304 for the fiscal year ended December 31, 2007
related to our corn derivative instruments as compared to a $3,183,371 gain for
the fiscal year ended December 31, 2006.  We recognize the gains or
losses that result from the changes in the value of our corn-related derivative
instruments in cost of goods sold as the changes occur.  As corn prices
fluctuate, the value of our derivative instruments changes, which affects our
financial performance.  Gross
Profit.  Gross profit for the fiscal year ended December 31, 2007
was $24,361,958, a 44% decrease from the gross profit of $43,876,473 for the
fiscal year ended December 31, 2006.  This decrease is due primarily to the
increases in the price of our raw materials (primarily corn and natural gas)
outpacing the increase in the selling price of our ethanol and distillers
grains.  35  In the fiscal year ending December 31, 2007, although the spread
between the selling price of the ethanol and distillers grains we sold and the
cost of the raw materials required to produce our ethanol was down from the
preceding year, we still realized a favorable margin.  Our ethanol-corn
price spread was approximately $2.16, as compared to a spread of approximately
$3.94 for the fiscal year ended December 31, 2006.  Operating
Expenses.  Operating expenses of $3,151,166 for the fiscal year
ended December 31, 2007, as compared to $2,970,684 for the fiscal year ended
December 31, 2006 remained relatively unchanged, representing 2.8% and 2.7% of
our revenues, respectively.  Operating
Income.  Operating income for the fiscal year ended December 31,
2007 totaled $21,210,792, or 19.0% of revenues.  Operating income for
fiscal year ended December 31, 2006 totaled $40,905,789, or 36.7% of revenues.
 The decrease in operating income for the fiscal year ended December 31,
2007 compared to fiscal year ended December 31, 2006 is primarily a result of
the decrease in Gross Profit as discussed above.  Other Income
(Expense).  Our other income (expense) for the fiscal year ended
December 31, 2007 was an income of $31,440, as compared to an expense of
$887,940 for the fiscal year ended December 31, 2006.  Our other income
(expense) items at December 31, 2007 consisted primarily of interest
income, interest expense, and a net loss on investment.  Our other income
(expense) items at December 31, 2006 consisted primarily of a net interest
expense.  The changes in other income (expense) items were due primarily to
an increase in interest income and a decrease in interest expense.  We did not receive any
payments from the USDA CCC Bioenergy program in the fiscal year ended
December 31, 2007 as compared to receipt of payments totaling $393,336 for
the fiscal year ended December 31, 2006.  Payments under the Bioenergy
Program were based upon increases in ethanol production relative to the previous
year.  The CCC announced that its funds would be exhausted in the third
quarter of the governments 2006 fiscal year and the program terminated as of
June 30, 2006.  Changes in Financial Condition for the
Fiscal Year ended December 31, 2008 Compared to the Fiscal Year ended December
31, 2007.  Assets totaled
$71,772,871 on December 31, 2008, as compared to $86,538,195 on December 31,
2007.  Current assets totaled $17,222,301 on December 31, 2008, as compared
to $33,920,040 on December 31, 2007.  This change resulted from (i) a
reduction in cash and cash equivalents on hand, which is primarily a net result
of an increase in cash from operations, less the $12,870,000 cash used for our
member distributions in February and August 2008, $14,356,139 cash used to
retire our long-term debt in April 2008, $8,410,146 used for capital
expenditures and construction in process, and $677,800 used for the repurchase
of membership units, (ii) a $1,238,142 increase in our restricted cash related
to our margin requirement for our derivative instruments, and (iii) decreases in
accounts receivable and prepaid expenses and other current assets, netted
against an increase in inventory.  Our investment assets
totaled $162,067 on December 31, 2008 as compared to $993,065 on December 31,
2007.  This decrease in our investment assets is the result of an
impairment loss of $866,000 in our investment in First Missouri Energy LLC
(FME) that we recorded in the second quarter of 2008, partially offset by a
$48,000 adjustment in the fourth quarter of 2008 to bring the book value to the
amount received from FME in February 2009.  During April 2008 we determined
that the viability of the First Missouri Energy project in the near future was
in question.  We based this determination on the proposals to delay, modify
or repeal state and federal subsidies and programs which would have a negative
impact on the project.  On January 22, 2009, FME sold the land that it
owned for approximately $1,430,000.  On February 20, 2009, FME distributed
monies from the sale of the land to its members, including $162,067 to United
Wisconsin Grain Producers, LLC.  Current liabilities were
$5,613,705 on December 31, 2008, as compared to $5,311,894 on December 31, 2007.
This increase is a net result of a $1,258,252 decrease in current maturities of
long-term debt related to the retirement of our long-term debt, a $756,793
increase in accounts payable, an addition of an accrued loss on forward
contracts of $1,058,536, and a $255,266 decrease in accrued liabilities.
 Long term debt, less current maturities, totaled $0 on December 31, 2008,
as compared to $13,097,887 on December 31, 2007.  This reduction in
long-term debt is also a direct reflection of the retirement of our long-term
debt in April 2008.  36  Members equity totaled $66,159,166 on December 31, 2008, as
compared to $68,128,414 on December 31, 2007.  This change is a net result
of earnings for the fiscal year less the $12,870,000 membership distribution
paid out in February and August 2008 and $677,800 paid out for the repurchase of
membership units during the year.  On June 11, 2007 the board approved up
to $1,000,000 to explore/pursue the option of buying back membership units over
the following twelve months.  This repurchase program expired in June 2008.
 As of December 31, 2008, we had repurchased of a total of 305 membership
units for $901,050 since the inception of the repurchase program.  Changes in Financial Condition for the
Fiscal Year ended December 31, 2007 Compared to the Fiscal Year ended December
31, 2006.  Assets totaled
$86,538,195 on December 31, 2007, as compared to $84,946,319 on
December 31, 2006.  Current assets totaled $33,920,040 on
December 31, 2007, as compared to $37,482,095 on December 31,
2006.  Current liabilities totaled $5,311,894 on December 31, 2007, as
compared to $5,182,917 on December 31, 2006.  Long term debt, net of
current maturities, totaled $13,097,887 on December 31, 2007, as compared
to $14,349,980 on December 31, 2006.  Members equity totaled
$68,128,414 on December 31, 2007, as compared to $65,413,512 on
December 31, 2006.  Liquidity and Capital Resources  Comparison of
fiscal years ended December 31, 2008 and 2007  The following table
shows cash flows for the fiscal years ended December 31, 2008 and 2007:  Fiscal
years ended December 31,2008

2007Net cash provided by operating
activities

$
     20,939,319

$
      24,694,496Net cash used in investing
activities

$
    (9,087,946)

$    (10,453,642)Net cash used in financing
activities

$   (27,226,139)

$    (19,462,571)  Cash Flow Provided
by Operations. The decrease in net cash flow provided from
operating activities for the fiscal years ended December 31, 2008 compared to
the fiscal years ended December 31, 2007 was primarily due to a decrease in our
net income, partially offset by changes in our current assets and current
liabilities; specifically, a decrease in accounts receivable, partially offset
by an increase in inventory due to higher prices.  Our capital needs are
adequately met through cash from our operating activities and our current
revolving line of credit.  Cash Flow Used In
Investing Activities.We used $1,365,696 less cash flow in
investing activities for the fiscal year ended December 31, 2008 than we did in
the fiscal year ended December 31, 2007.  This net decrease in the fiscal
year ended December 31, 2008 is due to $765,246 less used in capital
expenditures and construction in process payments, no monies used in the
purchase of investments, offset by $454,550 more used for the repurchase of
membership units as compared to the fiscal year ended December 31, 2007.
 The net cash used for investing activities was financed with cash from
operations.  On February 12, 2007,
our board approved up to a $10 million investment for an approximate 28%
ownership interest in a joint venture, First Missouri Energy LLC (FME), to
construct and operate a 55 million gallon capacity ethanol plant at Cape
Girardeau, Missouri.  As of December 31, 2008, we have invested $1,155,000
in this project and do not expect to contribute any additional capital.  In
April 2008, we determined that the viability of this project in the near future
was in question. We based this determination on the proposals to delay, modify,
or repeal state and federal subsidies and programs which would have a negative
impact on this project.  Accordingly, we recorded an impairment loss of
approximately $866,000 on this investment in the quarter ended June 30, 2008.
 On January 22, 2009, FME sold the land that it owned for approximately
$1,430,000.  On February 20, 2009, FME distributed monies from the sale of
the land to its members, including $162,067 to United Wisconsin Grain Producers,
LLC.  See Subsequent Events below.  We do not expect to
receive any additional proceeds from First Missouri Energy, LLC.  37  We presently estimate that an additional $28,000,000 will be
required to construct Phase II of our capacity expansion, all of which is
expected to be financed from a portion of cash flows from operations and
additional debt financing.  See Plant Expansion and Construction in
Process below for details regarding additional debt financing.  We
expect that Phase II of our expansion will provide additional ethanol production
capacity of 30 million gallons per year at our Friesland plant site.
 Tightening industry profit margins have led us to put this expansion on
hold indefinitely.  We currently estimate the 30 million gallon per year
expansion facility will not be complete by the second quarter of 2010, as we had
previously projected, due to this indefinite delay.  Utilizing cash
generated from operations for the plant expansion, if and when we proceed with
the expansion, may impact our ability to pay out future member distributions.
 Our financial projections are based upon our historical operating costs
and historical revenues.  However, our past financial performance may not
accurately predict future results.  Cash Flow Used In
Financing Activities.Our net cash flow used in financing
activities for the fiscal year ended December 31, 2008 increased $7,763,568, as
compared to expenditures for the fiscal year ended December 31, 2007.  We
used cash to pay down our debt by $14,356,139 and $1,158,491 during the fiscal
years ended December 31, 2008 and December 31, 2007, respectively.  Our
payments during the fiscal year ended December 31, 2008 retired our long-term
debt.  During the fiscal year ended December 31, 2008, we made cash
distributions to our members in the amount of $12,870,000 as compared to
$18,304,080 in the fiscal year ended December 31, 2007.  These
distributions were financed with cash from operations.  We expect to have
sufficient cash from cash flow generated by continuing operations, our revolving
line of credit and cash reserves.  We anticipate obtaining additional debt
financing for the purpose of financing approximately 60% of the cost of our
regenerative thermal oxidizer and corn oil extraction system project.
 However, if we are unable to obtain such debt financing on reasonable
terms, we expect to finance these projects with cash from operations.  See
Plant Expansion and Construction in Process below.  Additionally,
if we proceed with our planned expansion to 90 million gallons per year, we will
require additional debt financing.  See Plant Expansion and
Construction in Process below.  Obtaining additional debt financing
may be difficult given current conditions in credit markets.  A cash
shortage may impact our ability to pay future member distributions.  In the
event of a cash shortage, in addition to seeking additional debt financing we
may also consider seeking equity financing.  Comparison of the
fiscal years ended December 31, 2007 and 2006  The following table shows cash flows
for the fiscal years ended December 31, 2007 and 2006:  Fiscal
years ended December 31,2007

2006Net cash provided by operating
activities

$
     24,694,496

$
     43,914,660Net cash used in investing
activities

$   (10,453,642)

$
    (2,242,779)Net cash used in financing
activities

$   (19,462,571)

$   (20,477,027)   Cash Flow Provided
by Operations.  Our net cash flow provided from operating
activities for the fiscal year ended December 31, 2007 was $24,694,496, as
compared to $43,914,660 for the same period the previous year.  The
decrease in net cash flow provided from operating activities for the fiscal year
ended December 31, 2007 compared to fiscal year ended December 31,
2006 was primarily due to a decrease in net income.  Cash Flow Used In
Investing Activities.  Our net cash flow used in investing
activities for the fiscal year ended December 31, 2007 constituted
expenditures of $10,453,642, as compared to expenditures of $2,242,779 for the
same period the previous year.  The increase in expenditures for the fiscal
year ended December 31, 2007 compared to the fiscal year ended
December 31, 2006 is primarily due to a $7,032,613 increase in capital
expenditures and construction in process payments, most of which were for Phase
I of our plant expansion to 60 million gallons per year, and the additional
$1,055,000 investment in First Missouri Energy project.  The net cash used
for investing activities was financed with cash from operations from the current
and prior years.  Cash Flow Used In
Financing Activities.We used cash to pay down our debt by
$1,158,491 during the fiscal year ended December 31, 2007 compared to
$8,965,027 used for debt payments for the fiscal year ended December 31,
2006.  During the fiscal year ended December 31, 2007 we made cash
distributions to our members in 38   the aggregate
amount of $18,304,080 as compared to the aggregate amount of $11,512,000 during
the fiscal year ended December 31, 2006.  These distributions were financed
with cash from operations. Indebtedness  Short-Term and Long-Term Debt
Sources  On January 10, 2008 our
board voted to retire the balance of our existing long-term debt with
Farmers & Merchants Union Bank.  The term loan was subsequently
retired on April 24, 2008 using primarily cash from operations.  We
expect to obtain additional debt financing of between approximately $14,000,000
and $21,000,000 when we proceed with Phase II of our expansion, which would
increase our production capacity to 90 million gallons per year.  However,
this expansion has been indefinitely delayed due to tightening industry profit
margins.  See Plant Expansion and Construction in Process
below.  On October 16, 2008 we
entered into an agreement with Farmers and Merchants Union Bank to obtain a
$5,000,000 revolving line of credit.  This line of credit replaces our
previous line of credit with Farmers and Merchants Union Bank.  The
interest rate on amounts we borrow under the line of credit is a variable rate
of 0.5% over the highest US Prime Rate as published in the Wall Street Journal
Money Table.  The interest rate adjusts as and when the index rate
changes.  Interest is due monthly on this revolving credit facility.
 As of December 31, 2008, we had no borrowings against our revolving line
of credit.   No prepayment fees exist on the revolving credit
facility.  Our revolving credit
facility is subject to protective covenants requiring us to maintain various
financial ratios. We are required to maintain a minimum tangible net worth of
$24,000,000 and to increase our tangible net worth annually by the lesser of
$500,000 or an amount equal to retained earnings.  Our owners equity is to
be at least 45% of tangible net assets and we must maintain a working capital
position of at least $4,000,000.  We must receive written approval from our
lender to exceed $1,000,000 in annual capital expenditures and we must obtain
consent prior to making membership distributions in excess of 65% of the
previous years net income, excluding state and federal incentive payments.
  As of December 31, 2008, we are in compliance with all of our
financial debt covenants.  The revolving line of credit is secured by
substantially all of our assets.  Contractual Obligations  The following tables provide information regarding our
consolidated contractual obligations and commitments as of December 31,
2008:  Payment Due By PeriodContractual
Cash Obligations

Total

Less thanOne Year

One toThreeYears

Three toFiveYears

Greater Than FiveYearsOperating Lease Obligations (1)

$
3,344,183

$
545,805

$
960,678

$
938,400

$
899,300Purchase Obligations (2)

18,693,095

15,795,353

650,732

729,960

1,517,050Total Contractual Obligations

$
22,037,278

$
16,341,158

$
1,611,410

$
1,668,360

$
2,416,350  (1) Operating lease
obligations include the lease obligations for the Companys rail car leases (See
Note 9 to the financial statements) (2) Purchase obligations
primarily consist of forward contracts for corn and natural gas.  Plant Expansion and Construction in
Process  In December 2007, we
substantially completed an expansion of our plant capacity to 60 million gallons
(Phase I of our expansion).  We began operating at this expanded capacity
in July 2008; however, in September 2008 we began operating at less than full
capacity due to tightening industry margins.  Phase I of our expansion
increased the capacity of our grind, cook and fermentation systems.  This
work was completed on budget ($6.7 million) and financed entirely with cash from
operations.  Phase I of our expansion was completed under a Wisconsin
Department of Natural Resources construction permit that raised our production
limit to 60 million gallons. 39  We completed the expansion of our grain storage facility from
450,000 bushels to 900,000 bushels in July 2008.  This project was
completed on budget ($1,319,000) and financed with cash from operations.
 We completed the construction of a new cooling tower in September 2008.
 This project was completed on budget ($1,250,000) and financed with cash
from operations.  We completed the purchase and installation of additional
centrifuges in September 2008.  This project was completed on budget
($1,350,000) and financed with cash from operations.  We completed the
expansion of our grain shipping and receiving area in November 2008.  This
project was completed on budget ($1,124,000) and financed with cash from
operations.  We purchased and installed a new DDGS transportation and
cooling system in December 2008.  This project was completed on budget
($2,050,000) and financed with cash from operations.  Our Board approved
$3,150,000 for a regenerative thermal oxidizer (RTO) on March 10, 2008.
 This project is approximately 50% complete and is expected to be completed
in May 2009.  Our Board approved $3,671,300 for a corn oil extraction
system project on July 14, 2008.  This project is approximately 30%
complete and is expected to be completed in May 2009.  We expect to finance
these two projects with a combination of approximately 40% cash from operations
and 60% additional debt financing, provided that we can obtain such financing
upon reasonable terms.  If we are unable to obtain such debt financing, we
expect to finance these two projects entirely with cash from operations, which
may negatively impact our ability to pay out future member distributions.  Phase II of our
expansion involves the distillation and downstream processing of additional
beer, the product removed from the fermentors after fermentation is complete.
 The total estimated cost of this work, which will increase plant capacity
by 30 million gallons, is $28,000,000.  The Board approved $16,700,000 for
the development, design and completion of the distillation, dehydration and
evaporation components of the Phase II expansion project on June 11, 2007.
 The project is approximately 5% complete, which represents the early
planning and design work.  We have paid for the work to date with cash from
operations.  Phase II of our expansion is presently on hold due to
managements decision to re-examine the energy source and review new
technologies, and due to the recent erosion of industry profit margins.
 Should this project move forward, the Company expects to finance the
project with approximately 40% to 60% debt financing and approximately 40% to
60% cash from operations.  If we are unsuccessful in obtaining debt
financing, we will not be able to construct Phase II of our expansion.  Subsequent Events  On January 12, 2009, our
board of Directors voted to make a cash distribution of $100 per membership
unit, totaling approximately $2,847,500, to our membership unit holders of
record as of January 12, 2009.  The distribution was made on approximately
February 13, 2009.  On January 22, 2009,
First Missouri Energy, LLC, an entity in which the Company had invested, sold
the land owned by First Missouri Energy, LLC for approximately $1,430,000.
 On February 20, 2009, First Missouri Energy distributed monies from the
sale of the land to its members, including $162,067 to United Wisconsin Grain
Producers, LLC.  Off Balance Sheet Arrangements  We currently do not have
any off-balance sheet arrangements.  Application of Critical Accounting
Estimates  Management uses
estimates and assumptions in preparing our financial statements in accordance
with generally accepted accounting principles.  These estimates and
assumptions affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses.  We had the following critical accounting estimates as of the
fiscal year ended December 31, 2008, as compared to December 31, 2007, when we
had no critical accounting estimates.  We review long-lived
assets for impairment whenever events or changes in circumstances indicate that
the related carrying amounts may not be recoverable.  Impairment testing
for assets requires various estimates and assumptions, including an allocation
of cash flows to those assets and, if required, an estimate of the fair value of  40  those assets.
 Our estimates are based upon assumptions believed to be reasonable, but
which are inherently uncertain and unpredictable. These valuations require the
use of managements assumptions, which do not reflect unanticipated events and
circumstances that may occur.  In our analysis, we consider future corn
costs and ethanol prices, break-even points for our plant and our risk
management strategies in place through our derivative instruments and forward
contracts.  Given the significant assumptions required and the possibility
that actual conditions will differ, we consider the assessment of impairment of
our long-lived assets to be a critical accounting estimate.  Our allowance for
doubtful accounts as of December 31, 2008 and December 31, 2007 was $59,000 and
$69,000, respectively.  These amounts are based on our historical
experience and take into account factors such as our marketing agreements in
place for the marketing and sale of all of our ethanol and a portion of our
distillers grains, the payment due date for such ethanol and distillers grains
relative to when our marketers take possession of the products, and our past
success in collecting payment for the ethanol and distillers grains sold
pursuant to our marketing agreements.  Because our allowance for doubtful
accounts is based in part on our assumption that our future collection of
accounts will be similar to our historical experiences, we consider this to be a
critical accounting estimate.  ITEM 7A. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK.  We are exposed to the
impact of market fluctuations associated with interest rates and commodity
prices as discussed below. We have no exposure to foreign currency risk as all
of our business is conducted in U.S. Dollars. We use derivative financial
instruments as part of an overall strategy to manage market risk. We use cash,
futures and option contracts to hedge changes to the commodity prices of corn,
natural gas and ethanol. We do not enter into these derivative financial
instruments for trading or speculative purposes, nor do we designate these
contracts as hedges for accounting purposes pursuant to the requirements of SFAS
133, Accounting for Derivative Instruments and Hedging Activities.  Interest Rate Risk  We are exposed to market
risk from changes in interest rates.  Exposure to interest rate risk
results primarily from holding a revolving line of credit which bears a variable
interest rate. As of December 31, 2008, we had no borrowings against our
revolving line of credit.  The specifics of our revolving line of credit
are discussed in greater detail in Item 7  Managements Discussion and
Analysis of Financial Condition and Results of Operations  Short-Term and
Long-Term Debt Sources.  Below is a sensitivity
analysis we prepared regarding our income exposure to changes in interest rates.
The sensitivity analysis below shows the anticipated effect on our income from a
10% adverse change in interest rates for a one year period.  Outstanding Variable Rate Debt at
12/31/08
Interest Rate at
12/31/08
Adverse 10% Change in Interest
Rates
Annual Adverse Change to
Income$0
4.25%
0.425%
$0  Commodity Price Risk  We seek to minimize the
risks from fluctuations in the prices of raw material inputs, such as corn and
natural gas, and finished products, such as ethanol and distillers grains,
through the use of hedging instruments.  In practice, as markets move, we
actively manage our risk and adjust hedging strategies as appropriate.
 Although we believe our hedge positions accomplish an economic hedge
against our future purchases and sales, management has chosen not to use hedge
accounting, which would match the gain or loss on our hedge positions to the
specific commodity purchase being hedged.  We are using fair value
accounting for our hedge positions, which means as the current market price of
our hedge positions changes, the realized or unrealized gains and losses are
immediately recognized in our cost of goods sold or as an offset to revenues.
The immediate recognition of hedging gains and losses under fair value
accounting can cause net income to be volatile from quarter to quarter due to
the timing of the change in value of the derivative instruments relative to the
cost and use of the commodity being hedged.  41  As corn prices move in reaction to market trends and information,
our income statement will be affected depending on the impact such market
movements have on the value of our derivative instruments.  Depending on
market movements, crop prospects and weather, these price protection positions
may cause immediate adverse effects, but are expected to produce long-term
positive growth for us.  A sensitivity analysis
has been prepared to estimate our exposure to ethanol, corn and natural gas
price risk. Market risk related to these factors is estimated as the potential
change in income resulting from a hypothetical 10% adverse change in the fair
value of our corn and natural gas prices and average ethanol price as of
December 31, 2008, net of the forward and future contracts used to hedge our
market risk for corn and natural gas usage requirements.  The volumes are
based on our expected use and sale of these commodities for a one year period
from December 31, 2008.  As of December 31, 2008, approximately 14.1% of
our estimated corn usage, 27.6% of our anticipated natural gas usage and 21.0%
of our ethanol sales over the next 12 months were subject to fixed price or
index contracts where a price has been established with an exchange.  The
results of this analysis, which may differ from actual results, are as
follows:  Estimated Volume Requirements for
the next 12 months (net of forward and futures contracts)
Unit of Measure
Hypothetical Adverse Change in
Price as of 12/31/2008
Approximate Adverse Change to
IncomeNatural Gas
1,050,400
MMBTU
10%
$
892,840Ethanol
31,902,783
Gallons
10%
$
6,125,334Corn
15,884,671
Bushels
10%
$
6,750,985  42  ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.   REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM  Board of Directors United Wisconsin Grain Producers, LLC Friesland, Wisconsin  We have audited the accompanying balance
sheets of United Wisconsin Grain Producers, LLC as of December 31, 2008 and 2007
and the related statements of operations, changes in members equity, and cash
flows for the years ended December 31, 2008, 2007, and 2006.  United
Wisconsin Grain Producers, LLCs management is responsible for these financial
statements. Our responsibility is to express an opinion on these financial
statements based on our audits.  We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States).
 Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  The company is not required to have, nor were we engaged to
perform, an audit of its internal control over financial reporting.  Our
audit included consideration of internal control over financial reporting as a
basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the
companys internal control over financial reporting.  Accordingly, we
express no such opinion.  An audit also includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis for
our opinion.  In our opinion, the financial statements
referred to above present fairly, in all material respects, the financial
position of United Wisconsin Grain Producers, LLC as of December 31, 2008 and
2007, and the results of its operations and its cash flows for each of the years
in the three-year period ended December 31, 2008, 2007 and 2006, in conformity
with accounting principles generally accepted in the United States of
America.    /s/ Boulay, Heutmaker,
Zibell & Co. P.L.L.P. Certified Public
Accountants  Minneapolis, Minnesota March 19, 2009   43   UNITED WISCONSIN GRAIN PRODUCERS, LLCBalance SheetsDecember 31,

December 31,ASSETS

2008

2007Current AssetsCash and cash equivalents

$
9,384,848

$
24,759,614Restricted cash

1,486,525

248,383Derivative instruments

35,610

5,189Accounts receivable, net of
allowance for doubtful accountsof $59,000 and $69,000,
respectfully

2,354,767

5,486,721Prepaid expenses and other
current assets

400,917

634,869Inventory

3,559,634

2,785,264Total current assets

17,222,301

33,920,040Property, Plant and EquipmentLand and land
improvements

6,207,410

5,864,889Office equipment

607,816

567,547Buildings

2,447,579

2,192,293Plant and process
equipment

59,626,959

52,812,431Construction in process

3,864,418

2,906,876Total property,
plant, and equipment

72,754,182

64,344,036Less
accumulated depreciation

18,365,679

12,718,946Net property, plant and
equipment

54,388,503

51,625,090Other AssetsInvestment

162,067

993,065Total other assets

162,067

993,065Total Assets

$
71,772,871

$
86,538,195Notes to Financial Statements are an integral part
of this Statement.  44   UNITED WISCONSIN GRAIN PRODUCERS, LLCBalance SheetsDecember 31,

December 31,LIABILITIES
AND MEMBERS' EQUITY

2008

2007Current LiabilitiesCurrent maturities of long-term
debt

$
-

$
1,258,252Accounts payable

3,654,420

2,841,317Accounts payable - related
party

361,162

417,472Accrued loss on forward
contracts

1,058,536

-Accrued liabilities

539,587

794,853Total current liabilities

5,613,705

5,311,894Long-Term Debt, less current
maturities

-

13,097,887Commitments and ContingenciesMembers Equity, 28,475 and 28,710 units
authorized,issued, and outstanding, respectively

66,159,166

68,128,414Total Liabilities and
Members Equity

$
71,772,871

$
86,538,195Notes to Financial Statements are an integral part
of this Statement.  45   UNITED WISCONSIN GRAIN PRODUCERS, LLCStatements of OperationsYear Ended

Year Ended

Year EndedDecember 31,

December 31,

December 31,2008

2007

2006Revenues,including $146,311, $22,267, and
$3,861, respectively from related parties

$
139,335,829

$
111,736,700

$
111,366,602Cost of Goods Sold,including $4,966,566,
$3,267,970, and $2,695,337, respectively to related parties

123,115,305

87,374,742

67,490,129Lower of Cost or Market Adjustment

1,208,962

-

-Gross Profit

15,011,562

24,361,958

43,876,473Operating Expenses

2,971,173

3,151,166

2,970,684Operating Income

12,040,389

21,210,792

40,905,789Other Income (Expense)Grant income

-

5,000

-Interest income

504,480

1,084,679

554,263Government program income

-

-

393,336Interest expense

(358,686)

(1,068,539)

(1,338,803)Equity in net loss of
investment

(830,998)

(161,935)

-Miscellaneous income
(expense)

223,367

172,235

(496,736)Total other income (expense),
net

(461,837)

31,440

(887,940)Net Income

$
11,578,552

$
21,242,232

$
40,017,849Weighted Average Units Outstanding - Basic and
Diluted

28,520

28,767

28,780Net Income Per Unit - Basic and
Diluted

$
405.98

$
738.42

$
1,390.47Distributions Per Unit - Basic and
Diluted

$
451.26

$
636.29

$
400.00Notes to Financial Statements are an integral part
of this Statement.  46   UNITED WISCONSIN GRAIN PRODUCERS, LLCStatement of Changes in Members' EquityBalance - January 1, 2006
$
36,907,663Net Income
40,017,849Member Distributions
(11,512,000)Balance - December 31, 2006
65,413,512Net Income
21,242,232Repurchase of 70 Membership
units for an average price of $3,189,September 2007 to November
2007
(223,250)Member Distributions
(18,304,080)Balance - December 31, 2007
68,128,414Net Income
11,578,552Repurchase of 235 Membership
units for an average price of $2,884,January 2008 to June 2008
(677,800)Member Distributions
(12,870,000)Balance - December 31, 2008
$
66,159,166Notes to Financial Statements are an integral part
of this Statement.  47    UNITED WISCONSIN GRAIN PRODUCERS, LLCStatements of Cash FlowsYear Ended

Year Ended

Year EndedDecember 31,

December 31,

December 31,2008

2007

2006Cash Flows
from Operating ActivitiesNet
Income

$
11,578,552

$
21,242,232

$
40,017,849Adjustments
to reconcile net income to net cash provided by operations:Depreciation

5,646,733

4,914,526

4,857,026Write-off
of debt issuance costs

-

-

519,406Provision
for losses on accounts receivable

(9,796)

69,000

-Change
in fair value of derivative instruments

(5,230,628)

965,757

(3,183,371)Equity
in net loss of investment

830,998

161,935

-Changes
in assets and liabilities:Restricted
Cash

(1,238,142)

163,204

(331,307)Derivative
instruments

5,200,207

(820,483)

2,944,102Accounts
receivable

3,141,750

(1,257,531)

(721,138)Inventory

(774,370)

(710,751)

(380,582)Prepaid
expenses and other current assets

233,952

(68,858)

(227,607)Accounts
payable

756,793

586,148

(565,609)Accrued
loss on forward contracts

1,058,536

-

-Accrued
liabilities

(255,266)

(550,683)

985,891Net
cash provided by operating activities

20,939,319

24,694,496

43,914,660Cash Flows
from Investing ActivitiesCapital
expenditures

(27,529)

(7,594,950)

(974,473)Payments
for construction in process

(8,382,617)

(1,580,442)

(1,168,306)Purchase
of investments

-

(1,055,000)

(100,000)Repurchase
of membership units

(677,800)

(223,250)

-Net
cash used in investing activities

(9,087,946)

(10,453,642)

(2,242,779)Cash Flows
from Financing ActivitiesPayments
on long term debt

(14,356,139)

(1,158,491)

(8,965,027)Payment
of member distributions

(12,870,000)

(18,304,080)

(11,512,000)Net
cash used in financing activities

(27,226,139)

(19,462,571)

(20,477,027)Net Increase
(Decrease) in Cash and Cash Equivalents

(15,374,766)

(5,221,717)

21,194,854Cash and Cash
Equivalents Beginning of Period

24,759,614

29,981,331

8,786,477Cash and Cash
Equivalents End of Period

$   9,384,848

$  24,759,614

$
29,981,331Supplemental
Cash Flow InformationInterest
expensed

358,686

1,068,539

1,505,913Interest
capitalized

12,634

63,730

-Total
interest paid

$
371,320

$
1,132,269

$
1,505,913Noncash
Investing and Financing ActivitiesRefinancing
of long-term debt

$
-

$
-

$
16,040,376Transfer of construction in process to property,
plant, and equipment

$
7,425,075

$
-

$
-Notes to
Financial Statements are an integral part of this
Statement. 48  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   1.  SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES  The accompanying audited financial
statements of United Wisconsin Grain Producers, LLC have been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission. As used
in this report in Form 10-K, the Company represents United Wisconsin Grain
Producers, LLC (UWGP).  Nature of Business United Wisconsin Grain Producers LLC (a
Wisconsin limited liability company) is a 60 million gallon per year ethanol
plant located near the town of Friesland in the township of Randolph, Wisconsin.
 During 2007, the Company substantially completed Phase I of an expansion
project which increased the plant production capacity from the initial nameplate
production capacity of 40 million gallons per year to 60 million gallons per
year.  The Company sells its production of ethanol and distillers grains, a
co-product of ethanol production, within the United States.  Accounting
Estimates Management uses estimates and assumptions
in preparing these financial statements in accordance with generally accepted
accounting principles in the United States of America.  Those estimates and
assumptions affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses.  The Company uses estimates and assumptions in accounting for the
following significant matters, among others:  allowances for doubtful
accounts, useful lives of property, plant, and equipment, the valuation of
derivatives, inventory, inventory purchase commitments, the fair value of our
equity-method investment, and long-lived asset impairments.  Actual results
may differ from previously estimated amounts, and such differences may be
material to our financial statements.  The Company periodically reviews
estimates and assumptions, and the effects of revisions are reflected in the
period in which the revision is made.  Revenue Recognition The Company
generally sells ethanol and related products pursuant to marketing agreements.
 Revenues from the production of ethanol and the related products are
recorded when the customer (the marketing companies as further discussed in Note
14) has taken title and has assumed the risks and rewards of ownership, prices
are fixed or determinable and collectibility is reasonably assured.  Title
is generally assumed by the buyer at the end of the Companys shipping
point. In accordance with
the Companys agreements for the marketing and sale of ethanol and related
products, marketing fees and commissions due to the marketers are deducted from
the gross sales price as earned.  These fees and commissions are recorded
net of revenues as they do no provide an identifiable benefit that is
sufficiently separable from the sale of ethanol and related products. Shipping
costs incurred by the Company in the sale of ethanol are not specifically
identifiable and as a result, are recorded based on the net selling price
reported to the Company from the marketer.  Shipping costs incurred by the
Company in the sale of ethanol related products are included in cost of goods
sold. The Company records incentives receive, if
any, from federal and state programs related to the production of ethanol, as
other income, when the Company has sold the ethanol and completed all the
requirements of the applicable incentive program.  Interest income is
recognized as earned.  Cash and Cash Equivalents The Company considers all highly liquid
debt instruments purchased with a maturity of three months or less to be cash
equivalents.  The Company maintains its accounts primarily at one financial
institution.  At times throughout the year, the Companys cash and cash
equivalents balances may exceed amounts insured by the Federal Deposit Insurance
Corporation. At December 31, 2008 and 2007 such funds approximated $8,900,000
and $21,600,000, respectively. The Company does not believe it is exposed to any
significant credit risk on its cash and cash equivalents.  49  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   Restricted Cash The Company is required to deposit cash into a restricted
cash account by the Companys broker as discussed in Note 5.  Accounts Receivable Accounts receivable are recorded at their
estimated net realizable value, net of an allowance for doubtful accounts.
 The allowance for doubtful accounts is established through provisions
charged against income and is maintained at a level believed adequate by
management to absorb estimated bad debts based on historical experience and
current economic conditions. The Company extends credit to customers for sales
of ethanol and distillers grain in the normal course of business.  Credit
is extended based on an on-going evaluation of a customers financial conditions
and generally no collateral is required.  Accounts receivable are
ordinarily due in 5 to 10 business days for ethanol and 10 days from the invoice
date for distillers grain.  If payment is not received on a timely basis in
accordance with the Companys credit terms it is considered past due.
 Invoices that remain unpaid after 30 days may bear interest at 18% and are
considered delinquent if past due over 120 days.  Delinquent receivables
are written off based on credit evaluation and specific circumstances of the
customer. At December 31, 2008 and 2007, the Company has established an
allowance for doubtful accounts of approximately $59,000 and $69,000,
respectively.  Inventory Inventory is stated at the lower of cost or
market on a weighted cost basis. Market is based on current replacement values
except that it does not exceed net realizable values and it is not less than net
realizable values reduced by allowances from normal profit margin. Inventory
consists of raw materials, supplies, work in process, and finished goods. 
Corn is the primary raw material along with other raw materials. Finished goods
consist of ethanol produced and distillers grains.  Property, Plant, and Equipment Property, plant, and equipment are stated
at cost.  Depreciation is computed over estimated useful lives by use of
the straight-line method.  Asset Description

YearsLand improvements

5-20 yearsBuildings

10-30 yearsGrain handling equipment

5-15 yearsMechanical equipment

5-15 yearsEquipment

5-10 years  Maintenance and repairs are expensed as
incurred; major improvements and betterments are capitalized. Construction in
progress expenditures will be depreciated using the straight-line method over
their estimated useful lives once the assets are placed into service.  Long-Lived Assets Long-lived assets, such as property, plant,
and equipment, are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. If circumstances require a long-lived asset be tested for possible
impairment, the Company first compares undiscounted cash flows expected to be
generated by an asset to the carrying value of the asset. If the carrying value
of the long-lived asset is not recoverable on an undiscounted cash flow basis,
impairment is recognized to the extent that the carrying value exceeds its fair
value. Fair value is determined through various valuation techniques including
discounted cash flow models, quoted market values and third-party independent
appraisals, as considered necessary.  Capitalized Interest The Companys policy is to capitalize
interest cost incurred on debt during the construction of major projects
exceeding one year as guided by SFAS 34, Capitalization of Interest
Costs. During fiscal year 2008, approximately  50   UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   $12,600 of incurred interest cost was
capitalized to property, plant, and equipment.  The Company capitalized
interest of $64,000 and $0 during fiscal years 2007 and  2006,
respectively.  Derivative
Instruments The Company accounts for derivatives in
accordance with SFAS No. 133, Accounting for Derivative Instruments and
Hedging Activities. SFAS No. 133 requires the recognition of derivatives in
the balance sheet and the measurement of these instruments at fair value.  In order for a derivative to qualify as a
hedge, specific criteria must be met and appropriate documentation maintained.
Gains and losses from derivatives that do not qualify as hedges, or are
undesignated, must be recognized immediately in earnings. If the derivative does
qualify as a hedge, depending on the nature of the hedge, changes in the fair
value of the derivative will be either offset against the change in fair value
of the hedged assets, liabilities, or firm commitments through earnings or
recognized in other comprehensive income until the hedged item is recognized in
earnings.  Changes in the fair value of undesignated derivatives are
recorded in revenue or cost of goods sold based on the commodity being
hedged.  Additionally, SFAS No. 133 requires a
company to evaluate its contracts to determine whether the contracts are
derivatives. Certain contracts that literally meet the definition of a
derivative may be exempted as normal purchases or normal sales. Normal
purchases and normal sales are contracts that provide for the purchase or sale
of something other than a financial instrument or derivative instrument that
will be delivered in quantities expected to be used or sold over a reasonable
period in the normal course of business. Certain corn and distillers grains
contracts that meet the requirements of normal purchases or sales are documented
as normal and exempted from the accounting and reporting requirements of SFAS
No. 133, and therefore, are not marked to market in the financial
statements.  In order to reduce the risk caused by
market fluctuations, the Company occasionally hedges its anticipated corn
purchases and ethanol sales by entering into options and futures contracts.
 These contracts are used with the intention to fix the purchase price of
anticipated requirements of corn in the Companys ethanol production activities
and the related sales price of ethanol.  The fair value of these contracts
is based on quoted prices in active exchange-traded or over-the-counter markets.
Although the Company believes its commodity derivative positions are economic
hedges, none have been formally designated as a hedge for accounting purposes
and derivative positions are recorded on the balance sheet at their fair market
value, with changes in fair value recognized in current period earnings or
losses. The Company does not enter into financial instruments for trading or
speculative purposes. The Company records withdrawals and payments against the
trade equity of derivative instruments as a reduction or increase in the value
of the derivative instruments.  Government Incentive Payments For the years ended December 31, 2008, 2007
2006, the Company recorded $0, $0 and $393,336, respectively as government
program income in other income from the Commodity Credit Corporation Bioenergy
Program, a department of the United States Department of Agriculture.  This
program enabled the Company to receive payments of up to $7,500,000 per year
based on increases in production of ethanol over the previous year.  New
production was eligible and was considered increased production.  Payments
under the program were subject to pro rata reduction if aggregate payments to
all producers in any USDA fiscal year exceeded the annual funding of the
program.  As of December 31, 2008, and 2007, the Company had no receivable
recorded from the CCC Bioenergy Program. The program was terminated as of June
30, 2006 therefore the Company does not anticipate recording any additional
revenue from this program.  Fair Value of Financial
Instruments The carrying values of cash and cash
equivalents, restricted cash, accounts receivable, investments, accounts
payable, and accrued liabilities approximate fair value due to the short
maturity of the instruments.  51  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   Income Taxes The Company is treated as a partnership for
federal and state income tax purposes and generally does not incur income
taxes.  Instead, its earnings and losses are included in the income tax
returns of its members.  Therefore, no provision or liability for federal
or state income taxes has been included in these financial statements.  In June 2006, the FASB issued
Interpretation No. 48, Accounting for Uncertainty in Income Taxes(FIN 48). FIN 48 clarifies the requirements of SFAS 109, Accounting for
Income Taxes, relating to the recognition of income tax benefits. FIN 48
provides a two-step approach to recognizing and measuring tax benefits when
realization of the benefits is uncertain. The first step is to determine whether
the benefit meets the more-likely-than-not condition for recognition and the
second step is to determine the amount to be recognized based on the cumulative
probability that exceeds 50%.  Primarily due to the Companys tax status as
a partnership, the adoption of FIN 48 on November 1, 2008, had no material
impact on the Companys financial condition or results of operations.  Environmental liabilities The Companys operations are subject to
environmental laws and regulations adopted by various governmental authorities
in the jurisdiction in which it operates.  These laws require the Company
to investigate and remediate the effects of the release or disposal of materials
at its locations.  Accordingly, the Company has adopted policies, practices
and procedures in the areas of pollution control, occupational health and the
production, handling, storage and use of hazardous materials to prevent material
environmental or other damage, and to limit the financial liability which could
result from such events.  Environmental liabilities are recorded when the
Companys liability is probable and the costs can be reasonably estimated. 
No expense has been recorded for the years ending December 31, 2008, 2007, or
2006.  Net Income per Unit Basic net income per unit is computed by
dividing net income by the weighted average number of members units outstanding
during the period. Diluted net income per unit is computed by dividing net
income by the weighted average number of members units and members unit
equivalents outstanding during the period. There were no member unit equivalents
outstanding during the periods presented; accordingly, for all periods
presented, the Companys basic and diluted net income per unit are the same.  Recently Issued, But Not Yet Effective, Accounting
Pronouncements In March of 2008, the Financial Accounting
Standards Board (FASB) issued Statement of Financial Accounting Standards No.
161 (SFAS 161), Disclosures about Derivative Instruments and Hedging
Activities. SFAS 161 requires entities to provide enhanced disclosures about
(a) how and why an entity uses derivative instruments, (b) how derivative
instruments and related hedged items are accounted for under Statement 133 and
its related interpretations, and (c) how derivative instruments and related
hedged items affect an entitys financial position, financial performance, and
cash flows.  In September 2008, the FASB issued FASB
Staff Position (FSP) No. 133-1 and FIN 45-4, Disclosures about Credit
Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and
FASB Interpretation No. 45; and Clarification of the Effective Date of FASB
Statement No. 161. This FSP clarifies the effective date of SFAS 161. The
disclosures required by SFAS 161 should be provided for any reporting period
(annual or quarterly interim) beginning after November 15, 2008. This
clarification is effective upon issuance of the FSP in September 2008. The
Company is evaluating what effect, if any, SFAS 161 and FSP 133-1 & FIN 44-4
might have on its financial position, operating results, and the related
disclosures.  Reclassifications The presentation of revenues, cost of goods
sold, and operating expenses in the statements of operations for 2007 and 2006
have been changed to conform to the classification used in 2008.  These
reclassifications had no effect on net income as previously reported.  52   UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   2. RISKS AND UNCERTAINTIES  The Company has certain risks and
uncertainties that it experiences during volatile market conditions such as what
the Company experienced during fiscal 2008. These volatilities can have a severe
impact on operations. The Companys revenues are derived from the sale and
distribution of ethanol and distillers grains to customers primarily located in
the U.S. Corn for the production process is supplied to our plant primarily from
local agricultural producers and from purchases on the open market. Ethanol
sales, average 85% of total revenues and corn costs average 75% of cost of goods
sold.  The Companys operating and financial
performance is largely driven by the prices at which they sell ethanol and the
net expense of corn. The price of ethanol is influenced by factors such as
supply and demand, the weather, government policies and programs, and unleaded
gasoline prices and the petroleum markets as a whole. Excess ethanol supply in
the market, in particular, puts downward pressure on the price of ethanol. Our
largest cost of production is corn. The cost of corn is generally impacted by
factors such as supply and demand, the weather, government policies and
programs, and our risk management program used to protect against the price
volatility of these commodities.  3. CONCENTRATIONS  The Company has identified certain
concentrations that are present in their business operations. The Companys
revenue from ethanol sales is derived from a single customer under the Companys
ethanol marketing agreements described in Note 14. Sales under those agreements
accounted for approximately 84%, 89%, and 91% of the Companys revenues, net of
derivative activity, during 2008, 2007, and 2006, respectively. Accordingly, a
significant portion of the Companys receivables are regularly due from that
same customer.  The Company has a revenue concentration in
that its revenue is generated from the sales of just two products, ethanol and
distillers grains.  4.  INVENTORY  Inventory consists of the following at December 31:  2008
2007Raw Materials
$  1,495,032
$
    545,467Supplies
605,146
496,348Work in Process
381,988
412,772Finished goods
1,077,468
1,330,677Total
$  3,559,634
$
 2,785,264  The Company performed a lower of cost or
market analysis on inventory and determined that the market values of certain
inventories were less than their carrying value, attributable primarily to
decreases in market prices of corn and ethanol. Based on the lower of cost or
market analysis, the Company recorded a lower of cost or market charge on
certain inventories of approximately $150,000, $0, and $0 for the years ended
December 31, 2008, 2007 and 2006. The total impairment charge was recorded
within the lower of cost or market adjustment in the statement of operations.  5.  DERIVATIVE INSTRUMENTS  At December 31, 2008 and 2007, the Company
recorded an asset for derivative instruments related to corn and ethanol option
and futures positions of $35,610 and $5,189, respectively.  None of the
open positions, at December 31, 2008 or 2007, were designated as hedges.  53  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   The Company recorded the following combined
realized and unrealized gains (losses) on hedging activities:  Year ended
December 31, 2008
Year ended
December 31, 2007
Year ended
December 31, 2006Combined realized and unrealized gain on corn
hedging activities
$   3,324,800
$
      255,300
$ 3,183,000Combined realized and unrealized gain (loss) on
ethanol hedging activities
$   1,905,800
($  1,221,000)
$
   -  Realized and unrealized gains and losses
related to these derivative contracts related to corn purchases are included as
a component of cost of goods sold.  Realized and unrealized gains and
losses related to derivative contracts that are related to ethanol sales are
included as a component of revenues.  The Company is required to maintain cash
balances at its broker related to derivative instrument positions.  At
December 31, 2008 and 2007, restricted cash totaled $1,486,525 and $248,383,
respectively, and is not included in cash and cash equivalents on the balance
sheet or the statements of cash flows.  6.  INVESTMENTS  On February 12, 2007, the Companys
directors approved a $10 million equity investment in First Missouri Energy, LLC
(FME).  FME was formed with the intent to construct a 55 million gallon
per year ethanol plant near Cape Girardeau, Missouri. The Company invested
$1,155,000 in this project to date and does not plan to invest the additional
monies. During April 2008, the Company determined that the viability of this
project in the near future was in question.  Accordingly, the Company
recorded an impairment loss of approximately $866,000 on this investment in the
second quarter of 2008.  As of December 31, 2008 the board of FME was in
the process of selling the land and determining amounts owed to creditors. In
January 2009, FME received approximately $1.43 million for the sale of the land.
In February 2009, the Company received a payment for $162,067 which represented
the Companys proceeds from the remaining assets of FME based on the ownership
agreement.  The Company accounted for this investment
using the equity method of accounting and recorded a loss on this investment of
$830,998 for the fiscal year ending December 31, 2008 and $161,935 for the
fiscal year ended December 31, 2007.  7.  FAIR VALUE MEASUREMENTS  Effective January 1, 2008, the Company
adopted Statement of Financial Accounting Standard No. 157, Fair Value
Measurements (SFAS 157) and Statement of Financial Accounting Standard No.
159, The Fair Value Option for Financial Assets and Financial Liabilities
(SFAS 159).  SFAS 157s requirements for certain nonfinancial assets and
liabilities recognized or disclosed at fair value on a nonrecurring basis are
deferred until fiscal years beginning after November 15, 2008 in accordance with
FASB Staff Position 157-2 (FSP 157-2). At the present time, the Company does not
have any nonfinancial assets or liabilities that would require fair value
recognition or disclosures under SFAS 157.  SFAS 157 defines fair value, outlines a
framework for measuring fair value, and details the required disclosures about
fair value measurements. The adoption of SFAS 157 did not have a material effect
on the Companys financial position, results of operations, or cash flows for
2008.  54  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   SFAS 159 permits the Company to irrevocably
choose to measure certain financial instruments and other items at fair value.
Except for those assets and liabilities which are required to be recorded at
fair value the Company elected not to record any other assets or liabilities at
fair value, as permitted by SFAS 159.  Fair value is defined as the price that
would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date in the principal
or most advantageous market. The Company uses a fair value hierarchy that has
three levels of inputs, both observable and unobservable, with use of the lowest
possible level of input to determine fair value. Level 1 inputs include quoted
market prices in an active market or the price of an identical asset or
liability. Level 2 inputs are market data, other than Level 1, that are
observable either directly or indirectly. Level 2 inputs include quoted market
prices for similar assets or liabilities, quoted market prices in an inactive
market, and other observable information that can be corroborated by market
data. Level 3 inputs are unobservable and corroborated by little or no market
data. The Company uses valuation techniques in a consistent manner from
year-to-year.  The following table provides information on
those assets and liabilities measured at fair value on a recurring basis.  Carrying Amount in Balance Sheet December 31, 2008
Fair Value
December 31, 2008
Fair Value Measurement UsingLevel 1
Level 2
Level 3Derivative
Instruments
$
     35,610
$
     35,610
$
  35,610Investment in
First Missouri Energy, LLC
$
   162,067
$
   162,067


$
  162,067  The reconciliation of beginning and ending
balances for assets and liabilities measured at fair value using significant
unobservable inputs (Level 3) are as follows:  Investment in First Missouri Energy,
LLCBeginning Balance, January 1, 2008
$
   993,065Total losses-realized and unrealizedincluded in earnings
(830,998)Ending Balance, December 31, 2008
$
 162,067Total unrealized gains (losses) included in
earnings which are attributable to the change in unrealized gains or
losses related to assets still held at the reporting date
$
 (830,998)Total gains and losses, both unrealized and
realized, included in earnings are reported in the accompanying statement
of operations:Other expense
$
 (830,998)  The Company determines the fair value of
the certificates of deposits using information provided by the issuing bank,
which includes discounted expected cash flows of the certificates. The fair
value of the derivative instruments are based on quoted market prices in an
active market. The Companys Level 3 asset consists of the investment in First
Missouri Energy, LLC discussed in Note 6.  55  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   8.  BANK FINANCING  On May 25, 2006 the Company closed on a
mortgage in the amount of $21,040,376, which included a revolving credit
agreement in the amount of $5,000,000, and a term credit agreement in the amount
of $16,040,376 with Farmers & Merchants Union Bank to refinance the existing
debt with AgStar Financial Services, PCA.  The term debt consists of a
five-year business note in the amount of $16,040,376 at a fixed interest rate of
7.4% and requires monthly payments based on a ten-year amortization beginning
July 1, 2006.  As of December 31, 2008 and 2007, the Company had
outstanding debt of $0 and $14,356,139, respectively, on the term debt and did
not have any borrowings on the revolving credit commitment.  On January 10, 2008 the Company voted to
retire the balance of the Companys exiting long-term debt with Farmers &
Merchants Union Bank.  The Company retired the term debt in April 2008.  On October 16, 2008 the Company signed a
Revolving and Term Credit Agreement with Farmers & Merchants Union Bank
replacing the previous agreement.  The agreement is for a revolving loan of
$5,000,000 at a variable rate of 0.5% over the highest US Prime Rate as
published in the Wall Street Journal Money Table.  Borrowings under the
Credit Agreement are secured by substantially all of the assets of the Company.
The Company has restrictive covenants including, but not limited to, requiring
minimum financial ratios and limitations on capital expenditures, investments
and distributions.  As of the year ended December 31, 2008 and 2007 the
company was in compliance with these covenants.  The Company did not have
any outstanding borrowing on the revolving credit commitments as of December 31,
2008.  9.  LEASE OBLIGATIONS  The Company signed a ten-year lease
agreement in August 2004 with a leasing company for eighty-five covered hopper
rail cars at $460 per month per rail car.  The Company entered into two, five-year
rental agreements in April and May of 2005 for two wheel loaders at
approximately $1600 per month per wheel loader.  The Company entered into a five-year lease
agreement in April 2005 with a bank to lease a rail shuttle wagon at $3,300 per
month.  Lease expense for operating leases for the
years ending December 31, 2008, 2007, and 2006 was $549,110, $545,883 and
511,409 respectively.  At December 31, 2008 the Company had the
following minimum commitments for payment of leases:  2009

$
545,8052010

491,4782011

469,2002012

469,2002013

469,200Thereafter

899,300Total

$
3,344,183  10.  MEMBERS EQUITY  As specified in the Companys operating
agreement, the Company has one class of membership units.  The Company is
authorized to issue up to 28,000 membership units in addition to the seed
capital units issued prior to the Companys initial registered offering.  56  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   On June 11 2007, the board approved
up to $1 million over the next 12 months to explore/pursue the option of
redeeming membership units offered for sale at the market price.  As of
December 31, 2008, the board approved membership unit redemptions of 305 units
totaling $901,050 effective on various dates from September 1, 2007 to June 1,
2008.  The board has not approved any additional spending for the
redemption of membership units.  As of December 31, 2008 and 2007, the
Company had 28,475 and 28,710 membership units outstanding, respectively.  In February 2006, the Board of
Directors declared a cash distribution of $200.00 per membership unit for a
total distribution of $5,756,000 to its unit holders of record as of February
10, 2006. The distribution was paid in March 2006.  In July 2006, the Board of Directors
declared a cash distribution of $200.00 per membership unit for a total
distribution of $5,756,000 to its unit holders of record as of June 30, 2006.
The distribution was paid in August 2006.  In January 2007, the Board of
Directors declared a cash distribution of $500.00 per membership unit for a
total distribution of $14,390,000 to its unit holders of record as of January 9,
2007. The distribution was paid in February 2007.  In July 2007, the Board of Directors
declared a cash distribution of $136.00 per membership unit for a total
distribution of $3,914,080 to its unit holders of record as of July 10, 2007.
The distribution was paid in August 2007.  In January 2008, the Board of Directors
declared a cash distribution of $250.00 per membership unit for a total
distribution of $7,175,000 to its unit holders of record as of January 10, 2008.
The distribution was paid in February 2008.  In July 2008, the Board of Directors
declared a cash distribution of $200.00 per membership unit for a total
distribution of $5,695,000 to its unit holders of record as of July 14, 2008.
The distribution was paid in August 2008.  In January 2009, the Board of Directors
declared a cash distribution of $100.00 per membership unit for a total
distribution of $2,847,500 to its unit holders of record as of January 12, 2009.
The distribution was paid in February 2009.  11.  RELATED PARTY
TRANSACTIONS The Company
incurred approximately $72,000, $76,000, and $91,000 in director fees and
related expenses of which for the years ended December 31, 2008, 2007, and 2006,
respectively. In 2008, the Company purchased approximately $21,850,000 of corn
from members which represent approximately 24% of total corn purchased in 2008.
In 2007, the Company purchased approximately $15,042,000 of corn from members
which represent approximately 26% of total corn purchased in 2007.  In
2006, the Company purchased approximately $11,900,000 from members which
represent approximately 31% of corn purchased in 2006.  12.  EMPLOYEE BENEFIT PLANS  The Company has adopted a 401(k) plan
effective January 1, 2006 which provides retirement savings options for all
eligible employees.  Employees meeting certain eligibility requirements can
participate in the plan.  The Company makes a matching contribution based
on the participants eligible wages.  The Company made matching
contributions of approximately $73,000, $70,000 and $36,500 during the years
ended December 31, 2008, 2007, and 2006, respectively.  The employer
matching portion has a vesting schedule provision.  57  UNITED WISCONSIN GRAIN PRODUCERS, LLC Notes to Financial Statements  December 31, 2008 and 2007  The Company implemented a profit sharing employee benefit
plan on July 10, 2006 for all eligible employees.  The plan allows for a
percentage of the Companys earnings in excess of a pre-determined amount to be
divided between eligible employees and payment to be made six months after it is
earned to eligible employees still employed with the Company at the time of
payment.  The Company recorded an expense related to this plan of
approximately $463,000, $587,000 and $1,273,000 in the years ended December 31,
2008, 2007 and 2006, respectively.  Approximately $77,500 and $232,000 is
included in accrued liabilities as of December 31, 2008 and 2007, respectively.  13.  INCOME TAXES  The differences between financial statement basis and tax
basis of assets are as follows at December 31:  2008


2007Financial
statement basis of total assets

$
71,772,871

$
86,538,195Organizational
and start-up costs capitalized

1,836,382


1,836,382Syndication
costs not deductible for tax purposes

506,501


506,501Accumulated
depreciation and amortization

(6,388,995
)

(21,873,362
)Unrealized
derivative gains

(16,460
)

(1,152,891
)Unrealized
loss on investment

825,921


161,935Prepaid
expenses deductible for tax purposes

83,981


66,085Income tax basis of total assets

$
68,620,201

$
66,082,845Financial
statement basis of total liabilities

$5,613,705


$18,409,791Loss
on forward contracts not deductible for tax purposes

(1,058,536
)

-Accrued
expenses not deductible for tax purposes

(297,560
)

(625,528
)Income tax
basis of total liabilities

$
4,257,609

$
17,784,263  14.  COMMITMENTS AND CONTINGENCIES  Contractual Obligations  The following tables provide information regarding our
consolidated contractual obligations and commitments as of December 31,
2008:  Payment Due By PeriodContractual
Cash Obligations

Total

Less thanOne Year

One toThreeYears

Three toFiveYears

Greater Than FiveYearsOperating Lease Obligations (1)

$
3,344,183

$
545,805

$
960,678

$
938,400

$
899,300Purchase Obligations (2)

18,693,095

15,795,353

650,732

729,960

1,517,050Total Contractual
Obligations

$
22,037,278

$
16,341,158

$
1,611,410

$
1,668,360

$
2,416,350  (1) Operating lease
obligations include the Companys rail car leases (Note 9) (2) Purchase obligations
primarily include forward contracts for corn, natural gas, and denaturant.  58   UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007  Utility Agreements  In October 2003, the Company entered into
an agreement with an electric cooperative to provide electrical service.
 The agreement is in effect for a term of three years after electric
service was first provided in January of 2004.  At the anniversary of the
commencement of services the agreement automatically extends so that the term
again covers a period of three years, unless either party gives written notice
of intent not to extend.  Since neither party to the agreement has given
such notice, the agreement has extended for an additional three years, through
January 2010.  In April 2004, the Company entered into a
natural gas transportation service agreement, which provides for the
transportation of natural gas from the utility city gate to the plant at
specific transportation rates for a period of ten years. Upon conclusion of the
ten-year term, the agreement shall continue from year to year thereafter.  In December 2004, the Company entered into
a natural gas transportation service agreement, which provides for interstate
pipeline transportation of natural gas to the utility city gate at specific
transportation rates for a period of ten years from the effective date, November
1, 2006.  Upon conclusion of the ten-year term, the Company has the right
to renew the agreement at specified tariff rates or can enter into contract
negotiations to attempt to obtain a negotiated rate.  In August 2006, the Company entered into a
natural gas purchase agreement to purchases specified quantities of natural gas
at a then prevailing market price for a period of one year from the effective
date, November 1, 2006.  The Company also provided the required 60 day
notice to terminate the previous natural gas purchase agreement that had been in
effect since April 2004.  Ethanol marketing agreement and major
customer  In August 2004, the Company entered into a
marketing agreement with an unrelated company for the exclusive rights to
market, sell and distribute the entire ethanol inventory produced by the
Company.  The agreement commenced in May 2005 and was effective for an
initial term of 12 months and subsequently continued until December 31, 2007.
 The Company paid approximately $367,000 and $383,000 in marketing fees for
the years ended December 31, 2007 and 2006 respectively, which is netted against
revenues.  The Company sold 100% of its ethanol product under this
marketing agreement until December 31, 2007.  During the years ended
December 31, 2007 and 2006 sales through that marketer were approximately
$99,565,000 and $100,986,000, respectively.  At December 31, 2007 the
amount due from that customer included in receivables was approximately
$4,568,000.  The Company provided the required notice to terminate this
marketing agreement effective December 31, 2007.  In December 2007, the Company entered into
a new marketing agreement with an unrelated company for the exclusive rights to
market, sell and distribute the entire ethanol inventory produced by the
Company.  The agreement commenced on January 1, 2008 and is effective for
an initial term of 2 years.  Through this marketing agreement the Company
has control of its sales commitments and makes future commitments as it sees
fit.  The Company sold 100% of its ethanol product under this marketing
agreement during 2008.  During the year ended December 31, 2008 sales
through that marketer were approximately $116,766,000.  At December 31,
2008 the amount due from that customer included in receivables was approximately
$1,784,400.  At December 31, 2008, the Company had forward contracts to
sell 9 million gallons of ethanol for various delivery periods from January 2009
through June 2009.  The prices on these contracts range from $1.65 to $1.98
per gallon or have a basis level established by the Oil Price Information
Service (OPIS) Chicago ethanol market between -$0.07 and -$0.08.  Distillers grain marketing
contract  The Company has a marketing agreement with
CHS Inc. for the purpose of marketing and selling the dried distillers grains
that are shipped by rail.  The Company markets and sells the dried
distillers grains not shipped by rail, as well as the modified wet distillers
grains produced, directly to local farmers.  For the dried distillers
grains marketed and sold by CHS Inc., the Company receives a percentage of the
sales price invoiced by CHS Inc. less freight costs incurred by CHS Inc.
 The Company entered into this agreement with CHS Inc. effective October 1,
2007.  The term  59  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   of the agreement is indefinite, and the
agreement will remain in effect until terminated by either party by providing at
least 90 days notice to the other party to the agreement.  Distillers Grains
Contracts  At December 31, 2008, the Company had
forward dry distillers grains contracts totaling 10,400 ton for various delivery
periods from January to September 2009 with a price range of $110 to $170 per
ton.  At December 31, 2008 the Company had forward modified wet distillers
grains sales contracts totaling 6,700 ton for various delivery periods from
January 2009 to May 2009 with a price range of $50 to $77 per ton.  Corn and Natural Gas
Contracts  At December 31, 2008, the Company had
forward corn purchase contracts totaling 2.7 million bushels for various
delivery periods from January 2009 to December 2009, of which approximately 30%
are with members.  The prices on these contracts range from $3.10 to $6.73
per bushel or have a basis level established by the CBOT futures between $-0.05
and $-0.28.  Currently, some of these contract prices
are above current market prices for corn. Given declining corn and ethanol
prices, upon taking delivery under these contracts, the Company would incur a
loss. Accordingly, the Company recorded a loss on these purchase commitments of
approximately $1,059,000 for the year ended December 31, 2008. The loss was
included in the lower of cost or market adjustment on the statement of
operations. The amount of the loss was determined by applying a methodology
similar to that used in the lower of cost or market evaluation with respect to
inventory. Given the uncertainty of future corn and ethanol prices, this loss
may not be recovered, and further losses on the outstanding purchase commitments
could be recorded in future periods.  At December 31, 2008, the Company had
forward contracts to purchase approximately 400,000 million British thermal
units (MMBTU) of natural gas during the months of January through June 2009 at
an average price of approximately $7.85 per MMBTU.  Plant Expansion  As of December 31, 2008 the Company
incurred approximately $1.9 million for a regenerative thermal oxidizer expected
to cost $3.15 million in total and approximately $365,000 for an oil extraction
system expected to cost $3.7 million in total.  Both of these projects are
expected to be completed in May 2009.   As of December 31, 2008 the
Company incurred approximately $890,000 on the engineering, design, and support
piping of a distillation and evaporation system to increase the capacity of this
portion of the plant to 90 million gallons per year.  This project is
expected to cost $18 million in total but has been placed on hold
indefinitely.  60  UNITED
WISCONSIN GRAIN PRODUCERS, LLC  Notes to Financial Statements  December 31, 2008 and 2007   15.  QUARTERLY FINANCIAL DATA (UNAUDITED)  Summary quarterly results are as follows:  FirstQuarter

SecondQuarter

ThirdQuarter

FourthQuarterYear ended December 31, 2008Revenues

$
34,237,387

$
36,188,592

$
37,876,941

$
31,032,909Gross profit (loss)

8,446,421

12,555,077

(5,441,563)

(548,373)Operating income (loss)

7,493,018

11,603,914

(6,122,648)

(933,895)Net income (loss)

7,492,547

10,868,890

(5,975,347)

(807,538)Basic and diluted earnings (loss) per unit

261.66

381.39

(209.85)

(27.22)   FirstQuarter

SecondQuarter

ThirdQuarter

FourthQuarterYear ended December 31, 2007Revenues

$
29,001,792

$
28,187,346

$
26,579,028

$
27,968,534Gross profit

7,925,844

6,662,034

4,911,917

4,862,163Operating income

7,160,226

5,775,498

4,221,247

4,053,821Net income

7,142,869

5,694,717

4,251,754

4,152,892Basic and diluted earnings per unit

248.19

197.87

147.74

144.62  The above quarterly financial data is
unaudited, but in the opinion of management, all adjustments necessary for a
fair presentation of the selected data for these periods presented have been
included.  61   ITEM 9.  CHANGES IN
AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.  None.  ITEM 9A(T).  CONTROLS AND
PROCEDURES.  Disclosure Controls and
Procedures  Our management,
including our Chief Executive Officer (the principal executive officer), Jeff
Robertson, along with our Chief Financial Officer (the principal financial
officer), Barb Bontrager, have reviewed and evaluated the effectiveness of our
disclosure controls and procedures (as defined in Rule 13a-15(e) and
Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended)
as of December 31, 2008.  Based on this review and evaluation, these
officers have concluded that our disclosure controls and procedures are
effective to ensure that information required to be disclosed in the reports
that we file or submit under the Exchange Act  is recorded, processed,
summarized and reported within the time periods required by the forms and
rules of the Securities and Exchange Commission; and to ensure that the
information required to be disclosed by an issuer in the reports that it files
or submits under the Exchange Act is accumulated and communicated to our
management, including our principal executive and principal financial officers,
or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.  Internal Control Over Financial
Reporting  Inherent Limitations Over Internal
Controls  The Companys internal
control over financial reporting is designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted
accounting principles. The Companys internal control over financial reporting
includes those policies and procedures that:  (i) pertain to the
maintenance of records that, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the Companys assets;  (ii) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting
principles, and that the Companys receipts and expenditures are being made only
in accordance with authorizations of the Companys management and directors;
and  (iii) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition,
use, or disposition of the Companys assets that could have a material effect on
the financial statements.  Management, including
the Companys Chief Executive Officer and Chief Financial Officer, does not
expect that the Companys internal controls will prevent or detect all errors
and all fraud. A control system, no matter how well designed and operated, can
provide only reasonable, not absolute, assurance that the objectives of the
control system are met. Further, the design of a control system must reflect the
fact that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations in all
control systems, no evaluation of internal controls can provide absolute
assurance that all control issues and instances of fraud, if any, have been
detected. Also, any evaluation of the effectiveness of controls in future
periods is subject to the risk that those internal controls may become
inadequate because of changes in business conditions, or that the degree of
compliance with the policies or procedures may deteriorate.  62    Managements Report on Internal Control
Over Financial Reporting  Our management is
responsible for establishing and maintaining adequate internal control over
financial reporting (as defined in Rule 13a-15(f) under the Securities
Exchange Act of 1934, as amended). Management conducted an evaluation of the
effectiveness of the Companys internal control over financial reporting based
on the criteria set forth in Internal ControlIntegrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based
on this evaluation, management has concluded that the Companys internal control
over financial reporting was effective as of December 31, 2008.  This annual report does
not include an attestation report of our registered public accounting firm
regarding internal control over financial reporting.  Managements report
was not subject to attestation by our registered public accounting firm pursuant
to temporary rules of the Securities and Exchange Commission that permit us
to provide only managements report in this annual report.  Changes in Internal Control Over
Financial Reporting  There was no change in
our internal control over financial reporting during the fourth quarter of our
2008 fiscal year that was identified in connection with managements evaluation
required by paragraph (d) of Rules 13a-15 or 15d-15 under the Exchange
Act, that has materially affected, or is reasonably likely to materially affect,
our internal control over financial reporting.  ITEM 9B.  OTHER INFORMATION.  On October 16, 2008 we
entered into an agreement with Farmers and Merchants Union Bank to obtain a
$5,000,000 revolving line of credit.  The agreement is attached to this
annual report on Form 10-K as Exhibit 10.3.  This line of credit replaces
our previous line of credit with Farmers and Merchants Union Bank.  The
interest rate on amounts we borrow under the line of credit is a variable rate
of 0.5% over the highest US Prime Rate as published in the Wall Street Journal
Money Table.  The interest rate adjusts as and when the index rate
changes.  Interest is due monthly on this revolving credit facility.
 As of December 31, 2008, we had no borrowings against our revolving line
of credit.   No prepayment fees exist on the revolving credit
facility.  Our revolving credit facility is subject to protective covenants
requiring us to maintain various financial ratios. We are required to maintain a
minimum tangible net worth of $24,000,000 and to increase our tangible net worth
annually by the lesser of $500,000 or an amount equal to retained earnings.
 Our owners equity is to be at least 45% of tangible net assets and we
must maintain a working capital position of at least $4,000,000.  We must
receive written approval from our lender to exceed $1,000,000 in annual capital
expenditures and we must obtain consent prior to making membership distributions
in excess of 65% of the previous years net income, excluding state and federal
incentive payments.   As of December 31, 2008, we are in compliance
with all of our financial debt covenants.  The revolving line of credit is
secured by substantially all of our assets.  On January 13, 2009, we
entered into an employment agreement with our Chief Executive Officer, Jeff
Robertson.  The agreement is attached to this annual report on Form 10-K as
Exhibit 10.4.  The agreement is effective as of January 1, 2009 and is for
a term of two years.  The agreement provides for a base salary of $250,000
and an annual bonus equal to two percent of the Companys earnings in excess of
125% of the Companys target EBITDA.  In addition, under the agreement Mr.
Robertson is eligible to participate in the Companys incentive program, health
and dental insurance plans, 401(k) plan and disability benefit plan.  The
agreement also requires the Company to pay for a corporate golf membership,
subject to cost approval by the Companys Compensation Committee.  The
Company may terminate the employment of Mr. Robertson for just cause or the
death or disability of Mr. Robertson, paying his salary on a prorated basis to
the date of termination.  If Mr. Robertson is terminated for any other
reason, or if there is a sale of the assets of the Company and the purchaser
does not assume Mr. Robertsons employment agreement or negotiate a new
agreement acceptable to him, the Company must provide twelve (12) months notice
to Mr. Robertson, or pay to Mr. Robertson the value of six (6) months salary
and benefits, plus bonuses earned through the date of termination.  In
addition to the terms mentioned in the previous sentence, in the event of a sale
of the assets of the Company and if Mr. Robertson continues in full employment
until released by the Board of Directors, he is entitled to receive an
additional $200,000.  Mr. Robertsons employment agreement was negotiated
with and approved by the Companys Compensation Committee, and later approved by
the full Board of Directors.  63     PART III  Pursuant to General
Instruction G(3), we omit Part III, Items 10, 11, 12, 13 and 14 and
incorporate such items by reference to our definitive proxy statement filed with
the Securities and Exchange Commission on March 18, 2009.  PART IV  ITEM 15.  EXHIBITS, FINANCIAL
STATEMENT SCHEDULES.  Exhibits Filed as Part of this Report
and Exhibits Incorporated by Reference.  The following exhibits
and financial statements are filed as part of, or are incorporated by reference
into, this report:  (1) Financial Statements  The financial
statements appear beginning at page 43 of this report.  (2) Financial Statement Schedules  All supplemental
schedules are omitted as the required information is inapplicable or the
information is presented in the financial statements or related notes.  (3) Exhibits  Exhibit No.
Exhibit

Filed Herewith

Incorporated by Reference3.1
Articles of Organization of the
registrant.



Exhibit 3.1 to the registrants
registration statement on Form SB-2 filed with the Commission on July 10,
2002.3.2
Amended and Restated Operating
Agreement of the registrant.



Exhibit 3.2 to the registrants Form
10-QSB filed with the Commission on August 15, 2005.4.1
Form of Membership Unit
Certificate.



Exhibit 4.2 to the registrants
registration statement on Form SB-2 filed with the Commission on February
7, 2003.10.1
Distillers Grain Marketing Agreement
dated October 1, 2007 between the registrant and CHS Inc. +



Exhibit 10.16 to the registrants
Form 10-K filed with the Commission on March 18, 2008.10.2
Ethanol Purchase and Sale Agreement
dated December 12, 2007 between the registrant and Noble Americas Corp.
+



Exhibit 10.17 to the registrants
Form 10-K filed with the Commission on March 18, 2008.10.3
Revolving and Term Credit Agreement
dated October 16, 2008 between the registrant and Farmers & Merchants
Union Bank.

X10.4
Employment Agreement dated January
13, 2009 between the registrant and Jeff Robertson.

X  64    31.1
Certificate Pursuant to 17 CFR
240.13a-14(a)

X31.2
Certificate Pursuant to 17 CFR
240.13a-14(a)

X32.1
Certificate Pursuant to 18 U.S.C.
Section 1350

X32.2
Certificate Pursuant to 18 U.S.C.
Section 1350

X  (+) Confidential Treatment Requested.  65  SIGNATURES  Pursuant to the
requirements of Section 13 or 15(d) 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.  UNITED WISCONSIN GRAIN PRODUCERS, LLCDate:
March 19, 2009

/s/ J.F. RobertsonJ.F. RobertsonChief Executive Officer(Principal Executive
Officer)Date:
March 19, 2009

/s/  Barb
BontragerBarb BontragerChief Financial Officer(Principal Financial and
Accounting Officer)  Pursuant to the requirements of the
Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.   Date: March 19,
2009 /s/ William R. Herrmann William R. Herrmann, President and
Director   Date: March 19, 2009 /s/ Robert J. Miller Robert J. Miller, Vice President and
Director   Date: March 19,
2009 /s/ Robert T. Lange Robert T. Lange, Secretary and
Director   Date: March 19,
2009 /s/ Carl T. Benck Carl T. Benck, Director   Date: March 19,
2009 ___________________________________________ Calvin L. Dalton, Director   Date: March 19,
2009 ___________________________________________ Jerry H. Franz, Director   Date: March 19,
2009 /s/ Thomas J. Hanley Thomas J. Hanley, Director   Date: March 19,
2009 ___________________________________________ Kevin M. Roche, Director   Date: March 19,
2009 /s/ Berwyn G. Westra Berwyn G. Westra, Director  66    EXHIBIT INDEX  Exhibit No.
Description10.3
Revolving and Term Credit Agreement dated October
16, 2008 between the registrant and Farmers & Merchants Union
Bank.10.4
Employment Agreement dated January 13, 2009 between
the registrant and Jeff Robertson.31.1
Certificate Pursuant to 17 CFR
240.13a-14(a)31.2
Certificate Pursuant to 17 CFR
240.13a-14(a)32.1
Certificate Pursuant to 18 U.S.C. Section
135032.2
Certificate Pursuant to 18 U.S.C. Section
1350  67