##### Table of Contents



SECURITIES AND EXCHANGE
    COMMISSION
 WASHINGTON, D.C.
    20549
  Form 10-Q
  (Mark One)þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934for the quarterly period ended
    February 28, 2007.o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)  OF
    THE SECURITIES EXCHANGE ACT OF 1934for the transition period from
    to
    
    .   Commission File Number 0-50150
  CHS Inc.
 (Exact name of registrant as
    specified in its charter)
  Minnesota

41-0251095(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification Number)5500 Cenex Drive
    Inver Grove Heights, MN 55077(Address of principal
    executive offices,
    including zip code)

(651) 355-6000(Registrants
    telephone number,
    including area code)   þ o
  Rule 12b-2
  o o þ
  Rule 12b-2 o þ
   Number of Shares Outstanding atClass

February 28, 2007NONE

NONE




---



##### 



INDEX
  
  Page No.PART I.FINANCIAL
    INFORMATIONItem 1.

Financial
    Statements (unaudited)


3Consolidated
    Balance Sheets as of February 28, 2007, August 31,
    2006 and February 28, 2006


3Consolidated
    Statements of Operations for the three months and six months
    ended February 28, 2007 and 2006


4Consolidated
    Statements of Cash Flows for the six months ended
    February 28, 2007 and 2006


5Notes to
    Consolidated Financial Statements


6Item 2.

Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


19Item 3.

Quantitative and
    Qualitative Disclosures about Market Risk


41Item 4.

Controls and
    Procedures


41PART II.OTHER INFORMATIONItem 1A.

Risk
    Factors


42Item 4.

Submission of
    Matters to a Vote of Security Holders


42Item 6.

Exhibits


42SIGNATURE
    PAGE


43Amendment No. 1 to Note Purchase and Private Shelf AgreementSection 302 CertificationSection 302 CertificationSection 906 CertificationSection 906 Certification   1




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##### Table of Contents



PART I.
    FINANCIAL INFORMATION  SAFE
    HARBOR STATEMENT UNDER THE PRIVATE
    SECURITIES LITIGATION REFORM ACT OF 1995
  Form 10-Q Form 10-Q
 2




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##### Table of Contents



Item 1.
    Financial
    Statements  CHS INC.
    AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
 (Unaudited)
  February 28,


August 31,


February 28,2007


2006


2006(dollars in thousands)ASSETSCurrent assets:Cash and cash equivalents

$
140,308


$
112,525


$
79,743Receivables


1,082,763



1,076,602



797,573Inventories


1,269,704



1,130,824



1,021,369Other current assets


774,697



298,666



353,762Total current assets


3,267,472



2,618,617



2,252,447Investments


754,670



624,253



532,270Property, plant and equipment


1,563,174



1,476,239



1,418,657Other assets


235,641



223,474



223,171Total assets

$
5,820,957


$
4,942,583


$
4,426,545LIABILITIES AND
    EQUITIESCurrent liabilities:Notes payable

$
552,559


$
22,007


$
114,735Current portion of long-term debt


61,704



60,748



38,685Customer credit balances


106,261



66,468



48,048Customer advance payments


215,206



82,362



169,266Checks and drafts outstanding


106,089



57,083



55,040Accounts payable


793,103



904,143



609,970Accrued expenses


484,052



347,078



322,918Dividends and equities payable


142,668



249,774



117,334Total current liabilities


2,461,642



1,789,663



1,475,996Long-term debt


654,366



683,997



719,861Other liabilities


363,686



310,157



227,804Minority interests in subsidiaries


156,472



141,375



141,577Commitments and contingenciesEquities


2,184,791



2,017,391



1,861,307Total liabilities and equities

$
5,820,957


$
4,942,583


$
4,426,545    3




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
 (Unaudited)
  For the Three Months Ended


For the Six Months EndedFebruary 28,


February 28,2007


2006


2007


2006(dollars in thousands)Revenues

$
3,734,580


$
3,156,617


$
7,485,650


$
6,610,130Cost of goods sold


3,588,872



3,042,166



7,117,666



6,241,234Gross profit


145,708



114,451



367,984



368,896Marketing, general and
    administrative


58,591



56,530



110,693



106,156Operating earnings


87,117



57,921



257,291



262,740Gain on investments


(11,400
)






(16,748
)Interest, net


9,003



9,415



16,691



16,746Equity income from investments


(12,315
)


(5,185
)


(16,846
)


(14,362
)Minority interests


14,470



9,206



33,382



41,367Income from continuing operations
    before income taxes


87,359



44,485



240,812



218,989Income taxes


5,050



4,238



22,221



24,716Income from continuing operations


82,309



40,247



218,591



194,273Loss (income) on discontinued
    operations, net of taxes






99







(109
)Net income

$
82,309


$
40,148


$
218,591


$
194,382    4




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
 (Unaudited)
  For the Six Months Ended February 28,2007


2006(as restated)(dollars in thousands)Cash flows from operating
    activities:Net income

$
218,591


$
194,382Depreciation and amortization


68,947



58,892Income from equity investments


(16,846
)


(14,362
)Distributions from equity
    investments


24,253



38,673Minority interests


33,382



41,367Noncash patronage dividends
    received


(1,133
)


(780
)Gain on sale of property, plant
    and equipment


(2,840
)


(157
)Gain on investments


(16,748
)Deferred taxes


22,221



44,847Other, net


770



15Changes in operating assets and
    liabilities:Receivables


1,304



259,138Inventories


(134,278
)


(101,776
)Other current assets and other
    assets


(476,077
)


(8,768
)Customer credit balances


39,792



(44,336
)Customer advance payments


132,819



41,818Accounts payable and accrued
    expenses


27,367



(434,797
)Other liabilities


7,090



(8,308
)Net cash (used in) provided by
    operating activities


(71,386
)


65,848Cash flows from investing
    activities:Acquisition of property, plant and
    equipment


(154,996
)


(113,921
)Proceeds from disposition of
    property, plant and equipment


7,070



6,524Investments


(80,457
)


(37,015
)Investments redeemed


2,989



5,391Proceeds from sale of investment


10,918Changes in notes receivable


(15,350
)


48,158Other investing activities, net


(3,195
)


575Net cash used in investing
    activities


(233,021
)


(90,288
)Cash flows from financing
    activities:Changes in notes payable


530,513



53,587Principal payments on long-term
    debt


(28,684
)


(15,669
)Changes in checks and drafts
    outstanding


49,006



(12,556
)Distribution to minority owners


(22,294
)


(42,981
)Costs incurred  capital
    equity certificates redeemed


(45
)


(86
)Preferred stock dividends paid


(5,864
)


(4,952
)Retirements of equities


(57,334
)


(51,676
)Cash patronage dividends paid


(133,108
)


(62,502
)Net cash provided by (used in)
    financing activities


332,190



(136,835
)Net increase (decrease) in cash
    and cash equivalents


27,783



(161,275
)Cash and cash equivalents at
    beginning of period


112,525



241,018Cash and cash equivalents at end
    of period

$
140,308


$
79,743    5




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
 (dollars in thousands)
  Note 1.
    Accounting
    Policies      Form 10-K,
  Goodwill
    and Other Intangible Assets
      Recent
    Accounting Pronouncements
   6




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
       accrue-in-advance accrue-in-advance
      Reclassifications
   7




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
   Note 2.
    Receivables  February 28,


August 31,


February 28,2007


2006


2006Trade

$
1,068,778


$
1,056,514


$
824,590Other


70,409



73,986



35,8171,139,187



1,130,500



860,407Less allowances for doubtful
    accounts


56,424



53,898



62,834$
1,082,763


$
1,076,602


$
797,573   Note 3.
    Inventories  February 28,


August 31,


February 28,2007


2006


2006Grain and oilseed

$
598,351


$
511,413


$
433,403Energy


387,020



447,664



360,250Feed and farm supplies


229,590



137,978



205,241Processed grain and oilseed


52,824



32,198



21,000Other


1,919



1,571



1,475$
1,269,704


$
1,130,824


$
1,021,369   Note 4.
    Derivative
    Assets and Liabilities    Note 5.
    Investments     8




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
               Ventura
    Foods, LLC
  For the Three Months Ended


For the Six Months EndedFebruary 28,


February 28,2007


2006


2007


2006Net sales

$
381,594


$
343,404


$
779,727


$
730,765Gross profit


53,035



51,514



108,499



103,192Net income


22,208



15,574



44,215



32,247   February 28,


August 31,


February 28,2007


2006


2006Current assets

$
256,146


$
237,117


$
221,052Non-current assets


441,605



441,435



435,973Current liabilities


147,944



141,080



134,001Non-current liabilities


307,954



308,377



305,521  9




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
  Agriliance
    LLC
  For the Three Months Ended


For the Six Months EndedFebruary 28,


February 28,2007


2006


2007


2006Net sales

$
497,524


$
497,536


$
1,167,517


$
1,189,997Gross profit


45,921



52,637



91,544



110,202Net loss


(27,392
)


(16,894
)


(58,781
)


(32,602
)   February 28,


August 31,


February 28,2007


2006


2006Current assets

$
1,789,935


$
1,261,874


$
1,685,699Non-current assets


163,332



166,365



156,650Current liabilities


1,583,710



999,038



1,511,493Non-current liabilities


131,208



132,071



118,955   Note 6.
    Discontinued
    Operations    For the Three


For the SixMonths Ended


Months EndedFebruary 28,


February 28,2006


2006Marketing, general and
    administrative *

$
176


$
(323
)Interest, net


(13
)


145Income tax (benefit) expense


(64
)


69Loss (income) from discontinued
    operations

$
99


$
(109
)     *
    
    Includes a gain of $0.8 million on the sale of a facility
    for the six months ended February 28, 2006.  Note 7.
    Notes Payable
    and Long-term Debt     10




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
    Note 8.
    Interest,
    net    For the Three Months Ended


For the Six Months EndedFebruary 28,


February 28,2007


2006


2007


2006Interest expense

$
12,844


$
13,489


$
24,127


$
25,163Interest income


3,841



4,074



7,436



8,417Interest, net

$
9,003


$
9,415


$
16,691


$
16,746   Note 9.
    Equities    Fiscal 2007


Fiscal 2006Balances, September 1, 2006
    and 2005

$
2,017,391


$
1,757,897Net income


218,591



194,382Other comprehensive income


39,158



9,626Patronage distribution


(380,009
)


(207,803
)Patronage accrued


374,000



203,000Equities retired


(57,334
)


(51,676
)Equity retirements accrued


57,334



51,676Equities issued in exchange for
    elevator properties


864



6,342Preferred stock dividends


(5,864
)


(4,952
)Preferred stock dividends accrued


1,955



1,650Accrued dividends and equities
    payable


(83,084
)


(99,155
)Other, net


1,789



320Balances, February 28, 2007
    and 2006

$
2,184,791


$
1,861,307     Note 10.
    Comprehensive
    Income   11




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
   Note 11.  Employee Benefit Plans
    Qualified


Non-QualifiedPension Benefits


Pension Benefits


Other Benefits2007


2006


2007


2006


2007


2006Components of net periodic
    benefit cost for the three months ended February 28:Service cost

$
3,556


$
3,723


$
258


$
548


$
223


$
256Interest cost


4,817



4,259



362



342



419



392Return on plan assets


(7,380
)


(7,091
)Prior service cost amortization


222



214



106



129



(128
)


(76
)Actuarial loss (gain) amortization


1,381



1,879



39



53



(6
)


4Transition amount amortization


















234



234Net periodic benefit cost

$
2,596


$
2,984


$
765


$
1,072


$
742


$
810Components of net periodic
    benefit cost for the six months ended February 28:Service cost

$
7,180


$
7,446


$
512


$
1,098


$
479


$
512Interest cost


9,634



8,518



722



684



835



784Return on plan assets


(14,591
)


(14,181
)Prior service cost amortization


433



428



231



258



(256
)


(153
)Actuarial loss (gain) amortization


2,883



3,757



55



105



(20
)


9Transition amount amortization


















468



468Net periodic benefit cost

$
5,539


$
5,968


$
1,520


$
2,145


$
1,506


$
1,620   Employer
    Contributions:
    Note 12.
    Segment
    Reporting     12




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
                13




---



##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
     Ag





Corporate


ReconcilingEnergy


Business


Processing


and Other


Amounts


TotalFor the Three Months Ended
    February 28, 2007Revenues

$
1,713,683


$
1,883,836


$
177,936


$
8,442


$
(49,317
)

$
3,734,580Cost of goods sold


1,631,710



1,841,801



165,576



(898
)


(49,317
)


3,588,872Gross profit


81,973



42,035



12,360



9,340







145,708Marketing, general and
    administrative


22,224



23,703



6,044



6,620







58,591Operating earnings


59,749



18,332



6,316



2,720







87,117Gain on investments










(11,400
)










(11,400
)Interest, net


(624
)


7,412



3,879



(1,664
)






9,003Equity (income) losses from
    investments


(1,081
)


8,210



(18,345
)


(1,099
)






(12,315
)Minority interests


14,448



22















14,470Income from continuing operations
    before income taxes

$
47,006


$
2,688


$
32,182


$
5,483


$



$
87,359Intersegment revenues

$
(48,432
)

$
(795
)

$
(90
)





$
49,317


$
Capital expenditures

$
64,242


$
6,940


$
2,969


$
653






$
74,804Depreciation and amortization

$
21,378


$
8,447


$
3,621


$
1,300






$
34,746For the Three Months Ended
    February 28, 2006Revenues

$
1,599,136


$
1,450,689


$
148,992


$
8,365


$
(50,565
)

$
3,156,617Cost of goods sold


1,534,749



1,416,954



141,477



(449
)


(50,565
)


3,042,166Gross profit


64,387



33,735



7,515



8,814







114,451Marketing, general and
    administrative


19,456



24,203



5,688



7,183







56,530Operating earnings


44,931



9,532



1,827



1,631







57,921Interest, net


2,049



3,727



2,689



950







9,415Equity (income) losses from
    investments


(1,098
)


4,989



(8,229
)


(847
)






(5,185
)Minority interests


9,158



48















9,206Income from continuing operations
    before income taxes

$
34,822


$
768


$
7,367


$
1,528


$



$
44,485Intersegment revenues

$
(48,094
)

$
(2,406
)

$
(65
)





$
50,565


$
Capital expenditures

$
38,924


$
7,780


$
2,257


$
436






$
49,397Depreciation and amortization

$
18,174


$
7,974


$
3,459


$
1,301






$
30,908 14




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
  Ag





Corporate


ReconcilingEnergy


Business


Processing


and Other


Amounts


TotalFor the Six Months Ended
    February 28, 2007Revenues

$
3,567,092


$
3,688,452


$
332,960


$
15,748


$
(118,602
)

$
7,485,650Cost of goods sold


3,334,496



3,588,644



314,039



(911
)


(118,602
)


7,117,666Gross profit


232,596



99,808



18,921



16,659







367,984Marketing, general and
    administrative


43,211



42,988



12,000



12,494







110,693Operating earnings


189,385



56,820



6,921



4,165







257,291Gain on investments






(5,348
)


(11,400
)










(16,748
)Interest, net


(239
)


12,582



6,766



(2,418
)






16,691Equity (income) losses from
    investments


(2,137
)


18,799



(31,195
)


(2,313
)






(16,846
)Minority interests


33,409



(27
)














33,382Income from continuing operations
    before income taxes

$
158,352


$
30,814


$
42,750


$
8,896


$



$
240,812Intersegment revenues

$
(116,252
)

$
(2,176
)

$
(174
)

$



$
118,602


$
Goodwill

$
3,654


$
150














$
3,804Capital expenditures

$
130,385


$
15,540


$
7,918


$
1,153






$
154,996Depreciation and amortization

$
42,394


$
16,633


$
7,271


$
2,649






$
68,947Total identifiable assets at
    February 28, 2007

$
2,223,794


$
2,321,157


$
632,690


$
643,316






$
5,820,957For the Six Months Ended
    February 28, 2006Revenues

$
3,460,392


$
2,941,232


$
301,970


$
15,100


$
(108,564
)

$
6,610,130Cost of goods sold


3,200,205



2,863,844



286,787



(1,038
)


(108,564
)


6,241,234Gross profit


260,187



77,388



15,183



16,138







368,896Marketing, general and
    administrative


36,897



45,365



10,646



13,248







106,156Operating earnings


223,290



32,023



4,537



2,890







262,740Interest, net


3,168



7,231



5,112



1,235







16,746Equity (income) losses from
    investments


(1,936
)


7,250



(17,820
)


(1,856
)






(14,362
)Minority interests


41,285



82















41,367Income from continuing operations
    before income taxes

$
180,773


$
17,460


$
17,245


$
3,511


$



$
218,989Intersegment revenues

$
(103,657
)

$
(4,733
)

$
(174
)





$
108,564


$
Goodwill

$
3,041


$
250














$
3,291Capital expenditures

$
89,452


$
19,877


$
3,764


$
828






$
113,921Depreciation and amortization

$
33,911


$
15,515


$
6,940


$
2,526






$
58,892Total identifiable assets at
    February 28, 2006

$
1,837,558


$
1,726,997


$
467,721


$
394,269






$
4,426,545  15




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
  Note 13.
    Commitments
    and Contingencies  Environmental
    Guarantees
        Guarantee /


Exposure onMaximum


February 28,






Triggering

Recourse

Assets HeldEntities

Exposure


2007


Nature of Guarantee

Expiration Date

Event

Provisions

as CollateralThe Companys financial
    services cooperative loans sold to CoBank



*

$
132


10% of the obligations of borrowers
    (agri- cultural cooperatives) under credit agreements for loans
    sold

None stated, but may be terminated
    by either party upon 60 days prior notice in regard to
    future obligations

Credit agreement default

Subrogation against borrower

Some or all assets of borrower are
    held as collateral and  should be sufficient to cover guarantee
    exposureProvista Renewable Fuels Marketing,
    LLC

$
20,000



12,000


Obligations by Provista under
    credit agreement

None stated

Credit agreement default

Subrogation against Provista

NoneHorizon Milling, LLC

$
5,000






Indemnification and reimbursement
    of 24% of damages related to Horizon Milling, LLCs
    performance under a flour sales agreement

None stated, but may be terminated
    by any party upon 90 days prior notice in regard to future
    obligations

Nonperformance under flour sale
    agreement

Subrogation against Horizon
    Milling, LLC

NoneTEMCO, LLC

$
25,000



22,400


Obligations by TEMCO, LLC under
    credit agreement

None stated

Credit agreement default

Subrogation against TEMCO, LLC

None 16




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
  Guarantee /


Exposure onMaximum


February 28,






Triggering

Recourse

Assets HeldEntities

Exposure


2007


Nature of Guarantee

Expiration Date

Event

Provisions

as CollateralTEMCO, LLC

$
1,000



1,000


Obligations by TEMCO, LLC under
    counterparty agreement

None stated, but may be terminated
    upon 5 days prior notice in regard to future obligations

Nonpayment

Subrogation against TEMCO, LLC

NoneThird parties



*


764


Surety for, or indemnificaton of
    surety for sales contracts between affiliates and sellers of
    grain under deferred payment contracts

Annual renewal on December 1
    in regard to surety for one third party, otherwise none stated
    and may be terminated by the Company at any time in regard to
    future obligations

Nonpayment

Subrogation against affiliates

Some or all assets of borrower are
    held as collateral but might not be sufficient to cover
    guarantee exposureCofina Financial, LLC

$
19,161



13,029


Loans to our customers that are
    originated by Cofina and then sold to ProPartners, which is an
    affiliate of CoBank

None stated

Credit agreement default

Subrogation against borrower

Some or all assets of borrower are
    held as collateral but might not be sufficient to cover
    guarantee exposureCofina Financial, LLC

$
10,600



3,900


Loans made by Cofina to our
    customers

None stated

Credit agreement default

Subrogation against borrower

Some or all assets of borrower are
    held as collateral but might not be sufficient to cover
    guarantee exposure$
53,225     *
    
    The maximum exposure on any given date is equal to the actual
    guarantees extended as of that date.  Note 14.
    Restatement  Form 10-K
   17




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##### Table of Contents



CHS INC.
    AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
    (Unaudited)  (Continued)
     For the Six Months EndedFebruary 28,as


asreported


restatedCash flows from operating
    activities:Distributions from equity
    investments





$
38,673Net cash provided by operating
    activities

$
27,175



65,848Cash flows from investing
    activities:Equity investments redeemed


40,846Investments redeemed


3,218



5,391Net cash used in investing
    activities


(51,615
)


(90,288
)Net cash used in financing
    activities


(136,835
)


(136,835
)Net decrease in cash and cash
    equivalents


(161,275
)


(161,275
)Cash and cash equivalents at
    beginning of period


241,018



241,018Cash and cash equivalents at end
    of period


79,743



79,743  18




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##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Cautionary
    Statement Regarding Forward-Looking Statements
  The information in this Quarterly Report on
    Form 10-Q
    for the quarter ended February 28, 2007, includes
    forward-looking statements within the meaning of the
    Private Securities Litigation Reform Act of 1995 with respect to
    CHS. In addition, CHS and its representatives and agents may
    from time to time make other written or oral forward-looking
    statements, including statements contained in its filings with
    the Securities and Exchange Commission and its reports to its
    members and securityholders. Words and phrases such as
    will likely result, are expected to,
    is anticipated, estimate,
    project and similar expressions identify
    forward-looking statements. We wish to caution readers not to
    place undue reliance on any forward-looking statements, which
    speak only as of the date made.
  Our forward-looking statements are subject to risks and
    uncertainties that could cause actual results to differ
    materially from those discussed in the forward-looking
    statements. This Cautionary Statement is for the purpose of
    qualifying for the safe harbor provisions of the Act
    and is intended to be a readily available written document that
    contains factors which could cause results to differ materially
    from those projected in the forward-looking statements. The
    following matters, among others, may have a material adverse
    effect on our business, financial condition, liquidity, results
    of operations or prospects, financial or otherwise. Reference to
    this Cautionary Statement in the context of a forward-looking
    statement shall be deemed to be a statement that any one or more
    of the following factors may cause actual results to differ
    materially from those which might be projected, forecasted,
    estimated or budgeted by us in the forward-looking statement or
    statements.
  The following factors are in addition to any other cautionary
    statements, written or oral, which may be made or referred to in
    connection with any particular forward-looking statement. The
    following review should not be construed as exhaustive.
  We undertake no obligation to revise any forward-looking
    statements to reflect future events or circumstances.
  Our revenues and operating results could be adversely
    affected by changes in commodity prices.
    
    levels of worldwide and domestic supplies;
    capacities of domestic and foreign refineries;
    the ability of the members of OPEC to agree to and maintain oil
    price and production controls, and the price and level of
    foreign imports;
    disruption in supply;
    political instability or armed conflict in oil-producing regions; 19




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
    the level of consumer demand;
    the price and availability of alternative fuels;
    the availability of pipeline capacity; and
    domestic and foreign governmental regulations and taxes.    Our operating results could be adversely affected if our
    members were to do business with others rather than with
    us.
  We participate in highly competitive business markets in
    which we may not be able to continue to compete
    successfully.
  Changes in federal income tax laws or in our tax status
    could increase our tax liability and reduce our net
    income.
  We incur significant costs in complying with applicable
    laws and regulations. any failure to make the capital
    investments necessary to comply with these laws and regulations
    could expose us to financial liability.
    Environmental liabilities could adversely affect our
    results and financial condition.
 20




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Actual or perceived quality, safety or health risks
    associated with our products could subject us to liability and
    damage our business and reputation.
  Our operations are subject to business interruptions and
    casualty losses; we do not insure against all potential losses
    and could be seriously harmed by unexpected
    liabilities.
  
    our oil refineries and other facilities are potential targets
    for terrorist attacks that could halt or discontinue production;
    our inability to negotiate acceptable contracts with unionized
    workers in our operations could result in strikes or work
    stoppages;
    the significant inventories that we carry or the facilities we
    own could be damaged or destroyed by catastrophic events,
    extreme weather conditions or contamination; and
    an occurrence of a pandemic flu or other disease affecting a
    substantial part of our workforce or our customers could cause
    an interruption in our business operations, the affects of which
    could be significant.    Our cooperative structure limits our ability to access
    equity capital.
  Consolidation among the producers of products we purchase
    and customers for products we sell could adversely affect our
    revenues and operating results.
 21




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If our customers chose alternatives to our refined
    petroleum products our revenues and profits may
    decline.
  Operating results from our agronomy business could be
    volatile and are dependent upon certain factors outside of our
    control.
  Technological improvements in agriculture could decrease
    the demand for our agronomy and energy
    products.
  We operate some of our business through joint ventures in
    which our rights to control business decisions are
    limited.
  General
  Form 10-Q, Form 10-K, Form 10-Q.
     22




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®
             23




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Form 10-K
  Results
    of Operations
  Comparison
    of the three months ended February 28, 2007 and
    2006
  General.
       24




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Net Income.
  Revenues.
     25




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Cost of Goods Sold.
   26




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Marketing, General and
    Administrative.
  Gain on Investments.
  Interest, net.
 27




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Equity Income from Investments.
        Minority Interests.
  Income Taxes.
 28




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Discontinued Operations.
  Comparison
    of the six months ended February 28, 2007 and
    2006
  General.
       29




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##### Table of Contents



Net Income.
  Revenues.
     30




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##### Table of Contents



Cost of Goods Sold.
   31




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Marketing, General and
    Administrative.
  Gain on Investments.
  Interest, net.
 32




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Equity Income from Investments.
       33




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Minority Interests.
  Income Taxes.
  Discontinued Operations.
  Liquidity
    and Capital Resources
      Cash
    Flows from Operations
   34




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35




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Cash
    Flows from Investing Activities
         36




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Cash
    Flows from Financing Activities
  364-day
   37




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Form 10-K
 38




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10-year
   39




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Off
    Balance Sheet Financing Arrangements
  Lease
    Commitments:
  Form 10-K
  Guarantees:
    Debt:
    Contractual
    Obligations
  Form 10-K
  Critical
    Accounting Policies
  Form 10-K
  Effect of
    Inflation and Foreign Currency Transactions
    Recent
    Accounting Pronouncements
     40




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accrue-in-advance accrue-in-advance
      Item 3.
    Quantitative
    and Qualitative Disclosures About Market Risk  Form 10-K
  Item 4.
    Controls
    and Procedures  Rule 13a-15(e)
  Rule 13a-15(f)
 41




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PART II.
    OTHER INFORMATION Item 1.
    Not
    applicable  Item 1A.
    Not
    applicable  Item 2.
    Not
    applicable  Item 3.
    Not
    applicable  Item 4.
    Submission
    of Matters to a Vote of Security Holders      Item 5.
    Not
    applicable  Item 6.
    Exhibits  Exhibit

Description10
.1

First Amendment to Amended and
    Restated Loan and Security Agreement by and among Provista
    Renewable Fuels Marketing, LLC and LaSalle Bank National
    Association dated January 30, 2007 (incorporated by
    reference to Exhibit 10.1 to our Current Report on
    Form 8-K
    filed January, 31, 2007)10
.2

Amendment No. 1 to Note Purchase
    and Private Shelf Agreement dated April 9, 2007, among CHS
    Inc., Prudential Investment Management, Inc. and the Prudential
    Affiliate parties.31
.1

Certification Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 200231
.2

Certification Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 200232
.1

Certification Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 200232
.2

Certification Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002  42




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SIGNATURES    CHS Inc.
  /s/  John
    Schmitz   Executive Vice President and
 Chief Financial Officer
   43