v2.4.0.6
Document and Entity Information (USD $)
12 Months Ended
Sep. 30, 2012
Nov. 30, 2012
Mar. 31, 2012
Entity Information [Line Items]      
Entity Registrant Name Lincolnway Energy, LLC    
Entity Central Index Key 0001350420    
Current Fiscal Year End Date --09-30    
Entity Filer Category Non-accelerated Filer    
Document Type 10-K    
Document Period End Date Sep. 30, 2012    
Document Fiscal Year Focus 2012    
Document Fiscal Period Focus FY    
Amendment Flag false    
Entity Common Stock, Shares Outstanding   42,049  
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Public Float     $ 49,806,736
v2.4.0.6
Balance Sheets Statement (USD $)
Sep. 30, 2012
Sep. 30, 2011
CURRENT ASSETS    
Cash and cash equivalents $ 151,824 $ 34,135
Derivative financial instruments (Note 9 and 10) 71,978 520,045
Trade and other accounts receivable (Note 8) 9,276,324 8,041,523
Inventories (Note 3) 5,922,936 6,350,544
Prepaid expenses and other 325,361 328,881
Total current assets 15,748,423 15,275,128
PROPERTY AND EQUIPMENT    
Land and land improvements 6,949,062 7,633,650
Buildings and improvements 1,604,305 1,604,305
Plant and process equipment 79,580,097 76,014,786
Construction in progress 21,226 2,562,694
Office furniture and equipment 405,188 407,725
Property, plant and equipment gross 88,559,878 88,223,160
Accumulated depreciation (51,313,592) (43,529,798)
Property, plant and equipment, net 37,246,286 44,693,362
OTHER ASSETS    
Restricted cash (Note 6) 351,000 351,000
Financing costs, net of amortization of $305,384 and $252,070 166,577 219,891
Deposit 298,350 476,437
Investments 190,488 182,970
Other assets, noncurrent 1,006,415 1,230,298
Assets 54,001,124 61,198,788
CURRENT LIABILITIES    
Accounts payable 1,018,976 1,359,836
Accounts payable, related party (Note 7) 829,067 1,179,981
Current maturities of long-term debt (Note 5) 50,968 1,452,409
Current settlement payable, related party (Note 7) 425,000 0
Revolving credit loan (Note 4) 200,000 0
Accrued expenses 896,744 879,232
Total current liabilities 3,420,755 4,871,458
NONCURRENT LIABILITIES    
Long-term debt, less current maturities (Note 5) 3,424,053 2,738,021
Settlement payable, net of current amount, related party (Note 7) 1,275,000 0
Other 450,000 450,000
Total noncurrent liabilities 5,149,053 3,188,021
COMMITMENTS AND CONTINGENCY (Notes 6, 8 and 12)      
MEMBERS' EQUITY (Note 2)    
Member contributions, 42,049 units issued and outstanding 38,990,105 38,990,105
Retained Earnings 6,441,211 14,149,204
Members' Equity 45,431,316 53,139,309
Liabilities and Members' Equity $ 54,001,124 $ 61,198,788
v2.4.0.6
Balance Sheets (Parenthetical) (USD $)
12 Months Ended
Sep. 30, 2012
Sep. 30, 2011
OTHER ASSETS    
Financing costs, net of amortization of $ 305,384 $ 252,070
MEMBER'S EQUITY    
units issued and outstanding 42,049 42,049
v2.4.0.6
Statements of Operations Statement (USD $)
12 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2010
Revenues (Notes 1 and 8) $ 169,567,374 $ 173,951,126 $ 114,373,268
Cost of goods sold ( Notes 7 and 8) 171,827,633 169,817,362 106,744,081
Gross profit (loss) (2,260,259) 4,133,764 7,629,187
General and administrative expenses 2,955,565 2,649,796 2,440,390
(Gain) loss on sale or disposal of property and equipment (Note 13) 489,664 0 0
Contract settlement fee (Note 7) 1,700,000 0 0
Operating income (loss) (6,426,160) 1,483,968 5,188,797
Other income (expense):      
Interest income 6,957 9,542 25,019
Interest expense (237,565) (593,461) (851,358)
Other nonoperating income and expense (230,608) (583,919) (826,339)
Net income (loss) $ (6,656,768) $ 900,049 $ 4,362,458
Weighted average units outstanding 42,049 42,049 42,049
Net income (loss) per unit - basic and diluted $ (158.31) $ 21.40 $ 103.75
v2.4.0.6
Statements of Members' Equity (USD $)
Total
Member Contributions
Retained Earnings
Balance at Sep. 30, 2009 $ 49,979,252 $ 38,990,105 $ 10,989,147
Increase (Decrease) in Partners' Capital [Roll Forward]      
Distributions (2,102,450)   (2,102,450)
Net income (loss) 4,362,458   4,362,458
Balance at Sep. 30, 2010 52,239,260 38,990,105 13,249,155
Increase (Decrease) in Partners' Capital [Roll Forward]      
Distributions 0    
Net income (loss) 900,049   900,049
Balance at Sep. 30, 2011 53,139,309 38,990,105 14,149,204
Increase (Decrease) in Partners' Capital [Roll Forward]      
Distributions (1,051,225)   (1,051,225)
Net income (loss) (6,656,768)   (6,656,768)
Balance at Sep. 30, 2012 $ 45,431,316 $ 38,990,105 $ 6,441,211
v2.4.0.6
Statements of Members' Equity (Parenthetical) (USD $)
12 Months Ended
Sep. 30, 2012
Sep. 30, 2010
Distribution per unit $ 25 $ 50
v2.4.0.6
Statement of Cash Flows Statement (USD $)
12 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2010
CASH FLOWS FROM OPERATING ACTIVITIES      
Net income (loss) $ (6,656,768) $ 900,049 $ 4,362,458
Adjustments to reconcile net income (loss) to net cash provided by operating activities:      
Depreciation and amortization 7,850,854 8,232,529 8,378,554
(Gain) loss on sale or disposal of property and equipment (489,664) 62,696 573
Contract settlement fee 1,700,000 0 0
Changes in working capital components:      
Trade and other accounts receivable (1,234,801) (2,161,480) (2,107,860)
Inventories 427,608 (2,399,465) (1,465,707)
Prepaid expenses and other 3,520 (30,244) (101,590)
Deposits 178,087 (476,437) 151,036
Accounts payable (340,860) 86,760 173,278
Accounts payable, related party (350,914) 719,023 162,425
Accrued expenses 17,512 (172,428) 31,435
Derivative financial instruments 448,067 593,783 (773,402)
Net cash provided by operating activities 1,552,641 5,354,786 8,811,200
CASH FLOWS FROM INVESTING ACTIVITIES      
Purchase of property and equipment (1,041,800) (2,870,231) (823,612)
Proceeds from sale of property 1,181,000 0 0
Purchase of investments (7,518) (12,877) (24,118)
Net cash provided by (used in) investing activities 131,682 (2,883,108) (847,730)
CASH FLOWS FROM FINANCING ACTIVITIES      
Member distributions (1,051,225) 0 (2,102,450)
Proceeds from revolving credit loan 9,137,000 0 0
Payments on revolving credit loan (8,937,000) 0 0
Proceeds from long-term borrowings 24,170,000 1,000,000 0
Payments on long-term borrowings (24,885,409) (6,295,653) (8,827,857)
Net cash (used in) financing activities (1,566,634) (5,295,653) (10,930,307)
Net increase (decrease) in cash and cash equivalents 117,689 (2,823,975) (2,966,837)
CASH AND CASH EQUIVALENTS      
Beginning 34,135 2,858,110  
Ending 151,824 34,135 2,858,110
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION      
Cash paid for interest including capitalized interest 2012 none; 2011 $42,073; 2010 none 231,132 645,013 838,191
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES      
Construction in progress included in accounts payable 0 184,776 37,805
Construction in progress included in accrued expenses $ 0 $ 69,228 $ 2,688
v2.4.0.6
Statement of Cash Flows (Parenthetical) (USD $)
12 Months Ended
Sep. 30, 2011
SUPPLEMENT DISCLOSURE OF CASH FLOW INFORMATION, cash paid for interest including capitalized interest $ 42,073
v2.4.0.6
Nature of Business and Significant Accounting Policies
12 Months Ended
Sep. 30, 2012
Nature of Business and Significant Accounting Policies [Abstract]  
Business Description and Accounting Policies
Nature of Business and Significant Accounting Policies
 
Principal business activity:  Lincolnway Energy, LLC (the Company), located in Nevada, Iowa, was formed in May 2004 to pool investors to build a 50 million gallon annual production dry mill corn-based ethanol plant.  The Company began making sales on May 30, 2006 and became operational during the quarter ended June 30, 2006. The Company is directly influenced by commodity markets and the agricultural and energy industries and, accordingly, its results of operations and financial condition may be significantly affected by cyclical market trends and the regulatory, political and economic conditions in these industries.

A summary of significant accounting policies follows:

Use of estimates:  The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Concentration of credit risk:  The Company’s cash balances are maintained in bank deposit accounts which at times may exceed federally insured limits.  The Company has not experienced any losses in such accounts.

Cash and cash equivalents:  For the purposes of reporting the statement of cash flows, the Company includes as cash equivalents all cash accounts and highly liquid debt instruments which are not subject to withdrawal restrictions or penalties.  Certificates of deposit are considered investments as all have been purchased with maturities in excess of ninety days.  Although the Company maintains its cash accounts in one bank, the Company believes it is not exposed to any significant credit risk on cash and cash equivalents.  The Company has repurchase agreements with one bank, which totaled approximately $175,469 at September 30, 2012.  In accordance with the terms of the repurchase agreements, the Company does not take possession of the related securities.  The Company’s agreements also contain provisions to ensure that the market value of the underlying assets remain sufficient to protect the Company in the event of default by the banks by requiring that the underlying securities have a total market value of at least 100% of the bank’s total obligations under the agreements.

Trade accounts receivable:  Trade accounts receivable are recorded at original invoice amounts less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.  Management determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considering customers financial condition, credit history and current economic conditions.  Receivables are written off when deemed uncollectible.  Recoveries of receivables written off are recorded when received.  A receivable is considered past due if any portion of the receivable is outstanding more than 90 days.

Inventories:  Inventories are stated at the lower of cost or market using the first-in, first-out method.  In the valuation of inventories and purchase and sale commitments, market is based on current replacement values except that it does not exceed net realizable values and is not less than net realizable values reduced by allowances for approximate normal profit margin.

Financing costs:  Financing costs are recorded at cost and include expenditures directly related to securing debt financing.  The Company is amortizing these costs using the effective interest method over the term of the agreement.  The financing costs are included in interest expense on the statement of operations.

Property and equipment:  Property and equipment is stated at cost.  Construction in progress is comprised of costs related to the projects that are not completed.  Depreciation is computed using the straight-line method over the following estimated useful lives:

 
Years
Land improvements
20
Buildings and improvements
40
Plant and process equipment
5 – 20
Office furniture and equipment
3 – 7


Maintenance and repairs are expensed as incurred; major improvements and betterments are capitalized.  

Investments:  The Company has investments in financial service cooperatives.  These investments are carried at cost including allocated retained earnings of the cooperatives.

Derivative financial instruments:  The Company enters into derivative contracts to hedge the Company’s exposure to price risk related to forecasted corn needs, forward corn purchase contracts and ethanol sales.  The Company does not typically enter into derivative instruments other than for hedging purposes.  All the derivative contracts are recognized on the balance sheet at their fair market value.  Although the Company believes its derivative positions are economic hedges, none have been designated as a hedge for accounting purposes.   Accordingly, any realized or unrealized gain or loss related to corn derivatives is recorded in the statement of operations as a component of cost of goods sold.  Any realized or unrealized gain or loss related to ethanol derivative instruments is recorded in the statement of operations as a component of revenue. The Company reports all contracts with the same counter party on a net basis on the balance sheet.

Deposit:  The Internal Revenue Service (under Section 7519) requires partnerships that elect a fiscal year over a calendar year to make a deposit each year.  The deposit is 25% of annual taxable net income, multiplied by the tax rate of 36% for the reporting fiscal year.

Revenue recognition:  Revenue from the sale of the Company’s ethanol and distillers grains is recognized at the time title and all risks of ownership transfer to the customers.  This generally occurs upon the loading of the product.  For ethanol, title passes at the time the product crosses the loading flange in either a railcar or truck.  For distiller’s grain, title passes upon the loading into trucks.  For railcar shipments, this takes place when the railcar is filled and the marketer receives written notice that they have been loaded and are available for billing.  Shipping and handling costs incurred by the Company for the sale of ethanol and distiller’s grain are included in costs of goods sold. Commissions for the marketing and sale of ethanol and distiller grains are included in costs of goods sold.

Revenue by product is as follows:
(Excludes hedging activity)

(In thousands)
 
2012
 
2011
 
2010
Ethanol
 
$
126,440

 
$
139,536

 
$
94,612

Distiller's Grain
 
38,564

 
31,716

 
19,434

Other
 
4,570

 
3,826

 
1,766



Income taxes:  The Company is organized as a partnership for federal and state income tax purposes and generally does not incur income taxes.  Instead, the Company’s earnings and losses are included in the income tax returns of the members.  Therefore, no provision or liability for federal or state income taxes has been included in these financial statements. Management has evaluated the Company's material tax positions and determined there were no uncertain tax positions that require adjustment to the financial statements. The Company does not currently anticipate significant changes in its uncertain tax positions over the next 12 months. Generally, the Company remains subject to income tax examinations by U.S. federal or state tax authorities for fiscal years 2009 and thereafter.

Earnings per unit:  Basic and diluted earnings per unit have been computed on the basis of the weighted average number of units outstanding during each period presented.

Fair value of financial instruments:  The carrying amounts of cash and cash equivalents, derivative financial instruments, trade accounts receivable, accounts payable and accrued expenses approximate fair value.  The carrying amount of long-term debt approximates fair value because the interest rates are based on current rates offered to the Company for debt with similar terms and maturities.

Reclassification: Certain amounts in the 2011 balance sheet have been reclassified to be consistent with their 2012 presentation with no effect on net income.
 
v2.4.0.6
Members' Equity
12 Months Ended
Sep. 30, 2012
Members’ Equity [Abstract]  
Members' Equity
Members' Equity
 
The Company was formed on May 19, 2004.  It was initially capitalized by the issuance of 1,924 membership units totaling $962,000 to the founding members of the Company.  The Company has one class of membership units.  A majority of the Board of Directors owns a membership interest in the Company.  The Company is authorized to issue up to 45,608 membership units without member approval.

Income and losses are allocated to all members based on their pro rata ownership interest. All unit transfers are effective the last day of the month.    Units may be issued or transferred only to persons eligible to be members of the Company and only in compliance with the provisions of the operating agreement.

The Company is organized as an Iowa limited liability company. Members' liability is limited as specified in the Company's operating agreement and pursuant to the Iowa Limited Liability Company Act. The duration of the Company shall be perpetual unless dissolved as provided in the operating agreement.
v2.4.0.6
Inventories
12 Months Ended
Sep. 30, 2012
Inventory Disclosure [Abstract]  
Inventories
Inventories
 
Inventories consist of the following as of September 30, 2012 and 2011:

 
2012
 
2011
Raw materials, including corn, coal, chemicals and supplies
$
2,048,130

 
$
3,956,604

Work in process
1,432,257

 
1,303,654

Ethanol and distillers grain
2,442,549

 
1,090,286

Total
$
5,922,936

 
$
6,350,544



For the years ended September 30, 2012 and 2011, the Company recognized a reserve and resulting loss of $368,000 and none, respectively, for a lower of cost or market inventory adjustment.

v2.4.0.6
Revolving Credit Loan
12 Months Ended
Sep. 30, 2012
Revolving Credit Loan [Abstract]  
Revolving Credit Loan
Revolving Credit Loan
 
The Company entered into a new master loan agreement with a financial institution on August 20, 2012. One of the supplements of the agreement is a monitored revolving credit loan for up to $10,000,000. The amount available and outstanding under the loan cannot exceed the borrowing base as calculated per the agreement (approximately $9,400,000 as of September 30, 2012). The purpose of the loan is to finance inventory and receivables. The Company will pay interest monthly on the unpaid balance at a variable rate (adjusted on a weekly basis) based upon the one-month LIBOR index rate plus 3.25%. The Company will also pay a commitment fee on the average daily unused portion of the loan at the rate of .30% per annum, payable monthly. The term of the loan will expire, and the Company must pay all unpaid principal amounts outstanding under the loan, on July 1, 2013. The loan is secured by substantially all assets of the Company and subject to certain financial and nonfinancial covenants as defined in the master loan agreement. There was a balance of $200,000 outstanding as of September 30, 2012.
v2.4.0.6
Long-Term Debt
12 Months Ended
Sep. 30, 2012
Long-term Debt, Current and Noncurrent [Abstract]  
Long-term Debt
Long-Term Debt
 
Long-term debt consists of the following as of September 30, 2012 and 2011
 
2012
 
2011
Construction term loan.  (A)
$

 
$
1,500,000

 
 
 
 
Construction/revolving term loan.  (B)

 
1,000,000

 
 
 
 
Revolving term loan. (C)
3,237,000

 

 
 
 
 
Note payable to contractor, unsecured, interest-only quarterly
 

 
 

payments at 4% due through maturity date of December 2011.

 
1,250,000

 
 
 
 
Note payable to Iowa Department of Economic Development.  (D)

 
152,500

 
 
 
 
Note payable to Iowa Department of Transportation.  (E)
238,021

 
287,930

 
3,475,021

 
4,190,430

Less current maturities
(50,968
)
 
(1,452,409
)
 
$
3,424,053

 
$
2,738,021



Maturities of long-term debt as of September 30, 2012 are as follows:

Years ending September 30:
 
          2013
$
50,968

          2014
52,049

          2015
53,153

          2016
54,280

          2017
3,264,571

 
$
3,475,021


 
(A)
The Company had a construction and term loan with a financial institution.  Borrowings under the term loan included a variable interest rate based on the one-month LIBOR index rate plus 3.30%.  The rate was reset automatically without notice to the Company, on the first “US Banking Day” of each succeeding week, and each change was applicable to all outstanding balances as of that date.  The agreement required 30 principal payments of $1,250,000 per quarter commencing in December 2006 through March 2013.  The agreement required the maintenance of certain financial and nonfinancial covenants.  Borrowings under this agreement were collateralized by substantially all of the Company’s assets.  On August 20, 2012, the $1,500,000 balance remaining on this loan was consolidated under the revolving term loan, described in (C) below, and this construction term loan was closed.

(B)
The Company had a $10,000,000 construction/revolving term credit facility with a financial institution which would expire on September 1, 2016.  Borrowings under the credit facility agreement included a variable interest rate based on the one-month LIBOR index rate plus 3.30%.  The rate was reset automatically without notice to the Company, on the first “US Banking Day” of each succeeding week, and each change was applicable to all outstanding balances as of that date.  Borrowings were subject to borrowing base restrictions as defined in the agreement.  The credit facility and revolving credit agreement required the maintenance of certain financial and nonfinancial covenants.  Borrowings under this agreement were collateralized by substantially all of the Company’s assets.  This credit facility was replaced with the revolving term loan, described in (C) below.

(C)
The Company entered into a new master loan agreement with a financial institution on August 20, 2012. One of the supplements of the agreement is a revolving term loan available for up to $5,000,000. The revolving term loan is to be used to provide working capital and to consolidate under the revolving term loan the remaining $1,500,000 that is outstanding under the construction term loan (A). The Company will pay interest on the unpaid balance at a variable interest rate (adjusted on a weekly basis) based upon the one-month LIBOR index rate plus 3.50%. The Company will also pay a commitment fee on the average daily unused portion of the loan at the rate of .60% per annum, payable monthly. The loan is secured by substantially all assets of the Company and subject to certain financial and nonfinancial covenants as defined in the master loan agreement. The term of the loan will expire, and the Company must pay all unpaid principal amounts outstanding under the revolving term loan, on June 1, 2017.
   
(D)
The Company also had a $300,000 loan agreement with the Iowa Department of Economic Development (IDED).  The $300,000 loan was noninterest-bearing and due in monthly payments of $2,500 beginning December 2006 and a final payment of $152,500 due November 2011.  Borrowings under this agreement were collateralized by substantially all of the Company’s assets and subordinate to the above financial institution debt and construction and revolving loan/credit agreements included in (A) and (B).  On October 5, 2011, the final payment of $152,500 was made by the Company.

(E)
The Company entered into a $500,000 loan agreement with the Iowa Department of Transportation (IDOT) in February 2005.  The proceeds were disbursed upon submission of paid invoices.  Interest at 2.11% began accruing on January 1, 2007.  Principal payments will be due semiannually through July 2016.  The loan is secured by all rail track material constructed as part of the plant construction.  The debt is subordinate to the above financial institution debt and construction and revolving loan/credit agreements included in (C) and Note 4.
v2.4.0.6
Lease Commitments
12 Months Ended
Sep. 30, 2012
Leases [Abstract]  
Leases of Lessee Disclosure [Text Block]
Lease Commitments
 
The Company entered into a lease agreement with an unrelated third party to lease 90 hopper rail cars for the purpose of transporting distiller’s grain.  The five-year term of the lease commenced March 2006 and ended March 2011.  On March 26, 2011 the Company extended this lease with a rider. The rider calls for monthly payments of $56,700 plus applicable taxes.  There was also an additional usage rental of 2.5 cents per mile for each car that exceeds 30,000 miles.  The amendment that was made to the lease agreement on June 19, 2007, allowed the Company to purchase a certificate of deposit for $351,000 in lieu of the letter of credit that was required as partial security for the Company’s obligation under the lease.  The Company has classified this certificate of deposit as restricted cash in other assets. The lease term on the rider is for three years commencing March 2011 and expiring March 2014. In conjunction with a change in the Company’s ethanol marketer, on September 21, 2009, the Company was assigned a lease that was previously between the Company’s previous ethanol marketer and an unrelated third party.  The lease includes 100 tank rail cars for the purpose of transporting ethanol.  The lease calls for monthly payments of $52,500 plus applicable taxes, beginning October 1, 2009.  There is also an additional usage rental of 3 cents per mile for each car that exceeds 35,000 miles.  The lease has an expiration date of September 2016.
 
On February 2, 2010, the Company entered into a lease agreement with an unrelated third party to lease an additional 30 ethanol tank rail cars.  The one-year term of the lease ended on February 2011.  On March 8, 2011 the Company extended this lease with two riders for 15 railcars each. Each rider calls for monthly payments of $9,750 plus applicable taxes. There was also an additional usage rental of 3 cents per mile for each car that exceeds 30,000 miles.  The lease term on the riders is for three years commencing March 2011 and expiring March 2014.
 
The Company also leases office equipment and other equipment under operating leases that will expire at various dates through June 2015.

Approximate minimum lease payments under these operating leases for future years are as follows:
Years ending Sept 30:
 
          2013
$
1,594,000

          2014
1,075,000

          2015
635,000

          2016
630,000

          2017

 
$
3,934,000


Rent expense under the above operating leases totaled approximately, $1,890,000, $1,745,000 and $1,597,000 for the years ended September 30, 2012, 2011 and 2010, respectively.
 
v2.4.0.6
Related-Party Transactions
12 Months Ended
Sep. 30, 2012
Related Party Transactions [Abstract]  
Related Party Transactions
Related-Party Transactions
 
The Company has an agreement with the Heart of Iowa Coop (HOIC), dba Key Cooperative, a member of the Company, to provide 100% of the requirement of corn for use in the operation of the ethanol plant.  The agreement became effective when the Company began accepting corn for the use at the ethanol plant in May 2006 and will continue for a period of 20 years.  The Company pays a handling fee of $.0675 per bushel of corn.  If the Company chooses to buy corn that is not elevated by HOIC, and is inside a 60-mile radius of Nevada, Iowa, the Company will be required to pay HOIC $.04 per bushel of corn, outside a 60-mile radius, $.03 per bushel of corn.  The agreement may be terminated before the end of the term by providing six months’ notice of termination and paying the other party $2,000,000, reduced by $50,000 for each completed year of the agreement.  The amount is payable over four years with interest at the prime rate on the date of termination.  The Company purchased corn totaling $128,490,494, $127,764,206 and $71,804,446 for the years ended September 30, 2012, 2011 and 2010, respectively. 

As of September 30, 2012, the Company has a corn cash forward contract with HOIC amounting to 588,585 bushels, for a commitment of approximately $4,343,755 and several basis forward contracts representing 1,350,000 bushels of corn.  The contracts mature on various dates through December 2012.  The Company also has made miscellaneous purchases from HOIC amounting to $200,610, $84,739 and $96,392 for the years ended September 30, 2012, 2011 and 2010, respectively. The 2012 purchases include $117,562 in grain storage fees. As of September 30, 2012 and 2011 the amount due to HOIC is $829,067 and $1,179,981, respectively.

On April 10, 2012, the Company delivered notice to HOIC to terminate the Amended and Restated Grain Handling Agreement they hold with HOIC. The termination of the agreement will be effective January 10, 2013. The Company will begin to originate corn in house at the time of termination. The Company recorded a termination cost of $1,700,000 as required under the agreement, which was expensed for the quarter ending June 30, 2012. Payments of $425,000 will be made annually over a four year period with interest at the prime rate on the date of termination.

The Company is also purchasing propane and anhydrous ammonia from Innovative Ag Services (IAS), a member of the Company. Total purchases for the years ended September 30, 2012, 2011 and 2010 were $170,878, $16,402 and $21,714, respectively.
v2.4.0.6
Commitments and Major Customer and Subsequent Event
12 Months Ended
Sep. 30, 2012
Commitments and Major Customer [Abstract]  
Commitments and Major Customer and Subsequent Event
Commitments and Major Customer and Subsequent Event
 
On September 25, 2009, the Company entered into an agreement with an unrelated entity.  The agreement became effective on October 1, 2009.  The unrelated entity is responsible for marketing and purchasing all of the ethanol produced by the company.  For the years ended September 30, 2012, 2011 and 2010, the Company has expensed $690,664, $712,258 and $695,945, under this agreement for marketing fees, respectively.  Revenues with this customer were $126,439,534, $139,535,766 and $94,611,865 for the years ended September 30, 2012, 2011 and 2010, respectively.  Trade accounts receivable of $6,778,356 and $6,129,247 was due from the customer as of September 30, 2012 and 2011 respectively.  As of September 30, 2012, the Company has ethanol sales commitments with the unrelated entity of 5,380,000 gallons through December 2012. The sales price is approximately 10 cents under the monthly average OPIS-Chicago index price.

Subsequent to year end, the Company and unrelated party mutually agreed to terminate the ethanol marketing agreement effective December 31, 2012.

 The Company has entered into an agreement with an unrelated entity for marketing, selling and distributing the distiller’s grain as of October 1, 2007.   For the years ended September 30, 2012, 2011 and 2010, the Company has expensed marketing fees of $628,349, $535,226 and $295,353, respectively, under this agreement.  Revenues with this customer were $38,564,213, $31,715,564 and $19,434,064 for the years ended September 30, 2012, 2011 and 2010, respectively.  Trade accounts receivable of $2,064,496 and $1,083,695 was due from the customer as of September 30, 2012 and 2011, respectively.  As of September 30, 2012, the Company has distiller’s grain sales commitments with the unrelated entity of 4,385 tons for a total sales commitment of approximately $1,176,418 less marketing fees.
 

The Company has an agreement with an unrelated party to provide the coal supply for the ethanol plant.  The agreement includes the purchase of coal at a cost per ton and a transportation cost per ton as defined in the agreement.  The cost is subject to price adjustments on a monthly basis.  If the Company fails to purchase the minimum number of tons of coal for the calendar year , the Company shall pay an amount per ton multiplied by the difference of the minimum requirement and actual quantity purchased.  That agreement expired as of January 1, 2008.   On October 1, 2007 the Company entered into an amended agreement to the original coal supply agreement.  The term of the agreement has been extended from the original expiration date to January 1, 2013.  The same minimum purchase commitment is required from the Company as the previous agreement.  The calendar year 2012 has a remaining estimated purchase commitment totaling approximately $89,702.  For the years ended September 30, 2012, 2011 and 2010, the Company has purchased coal of $7,217,257, $7,001,676 and $5,989,438 respectively.

The Company has entered into a variable contract with a supplier of denaturant.  The variable contract is for a minimum purchase of 216,000 gallons at the average of the OPIS Conway In-Well Natural Gasoline High and Low prices for the full calendar month of date of loading plus $0.1875 per net gallon. The term of the contract is from October 1, 2012 through December 31, 2012.   The estimated future purchase commitment on this contract is approximately $470,297.


v2.4.0.6
Risk Management
12 Months Ended
Sep. 30, 2012
Risk Management [Abstract]  
Derivative Instruments and Hedging Activities Disclosure
Risk Management
 
The Company’s activities expose it to a variety of market risks, including the effects of changes in commodity prices.  These financial exposures are monitored and managed by the Company as an integral part of its overall risk management program.  The Company’s risk management program focuses on the unpredictability of commodity markets and seeks to reduce the potentially adverse effects that the volatility of these markets may have on its operating results.

The Company maintains a risk management strategy that uses derivative instruments to minimize significant, unanticipated earnings fluctuations caused by market fluctuations.  The Company’s specific goal is to protect the Company from large moves in the commodity costs.

To reduce price risk caused by market fluctuations, the Company generally follows a policy of using exchange-traded futures and options contracts to minimize its net position of merchandisable agricultural commodity inventories and forward purchases and sales contracts.
Exchange traded futures and options contracts are designated as non-hedge derivatives and are valued at market price with changes in market price recorded in operating income through cost of goods sold for corn derivatives and through revenue for ethanol derivatives.
 
Derivatives not designated as hedging instruments as of September 30, 2012 and 2011 are as follows:

 
2012
 
2011
Derivative assets
$
134,050

 
$
292,375

Cash held by (due to) broker
(62,072
)
 
227,670

Total
$
71,978

 
$
520,045




The effects on operating income from derivative activities is as follows for the years ending September 30, are as follows:

 
2012

 
2011

 
2010

Increase (decrease) in revenue due to derivatives related to ethanol sales:
 
 
 
 
 
Realized
$
(7,308
)
 
$
(2,655,034
)
 
$
45,434

Unrealized

 
1,528,367

 
(1,483,997
)
Total effect on revenue
(7,308
)
 
(1,126,667
)
 
(1,438,563
)
 
 
 
 
 
 
(Increase) decrease in cost of goods sold due to derivatives related to corn costs:
 

 
 

 
 

Realized
(1,134,488
)
 
(2,946,138
)
 
604,475

Unrealized
134,050

 
(44,125
)
 
849,475

Total effect on cost of goods sold
(1,000,438
)
 
(2,990,263
)
 
1,453,950

 
 
 
 
 
 
Total (decrease) increase  to operating income due to derivative activities
$
(1,007,746
)
 
$
(4,116,930
)
 
$
15,387



Unrealized gains and losses on forward contracts, in which delivery has not occurred, are deemed “normal purchases and normal sales”, and therefore are not marked to market in the Company’s financial statements, but are subject to a lower of cost or market assessment.
v2.4.0.6
Fair Value Measurements
12 Months Ended
Sep. 30, 2012
Fair Value Disclosures [Abstract]  
Fair Value Measurements
Fair Value Measurements
 
Fair value is 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 determining fair value, the Company uses various methods including market, income and cost approaches.  Based on these approaches, the Company often utilizes certain assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and/or the risks inherent in the inputs to the valuation technique.  These inputs can be readily observable, market-corroborated, or generally unobservable inputs.  The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.  Based on the observability of the inputs used in the valuation techniques, the Company is required to provide the following information according to the fair value hierarchy.  The fair value hierarchy ranks the quality and reliability of the information used to determine fair values.  Financial assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:

Level 1 Valuations for assets and liabilities traded in active markets from readily available pricing sources for market transactions involving identical assets or liabilities.

Level 2Valuations for assets and liabilities traded in less active dealer or broker markets.  Valuations are obtained from third-party pricing services for identical or similar assets or liabilities.

Level 3Valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities.
 
A description of the valuation methodologies used for instruments measured at fair value, including the general classification of such instruments pursuant to the valuation hierarchy, is set forth below.  These valuation methodologies were applied to all of the Company’s financial assets and financial liabilities carried at fair value.
 
Derivative financial instruments:  Commodity futures and exchange-traded commodity options contracts are reported at fair value utilizing Level 1 inputs.  For these contracts, the Company obtains fair value measurements from an independent pricing service.  The fair value measurements consider observable data that may include dealer quotes and live trading levels from the CME and NYMEX markets.  The fair value measurements consider observable data that may include dealer quotes and live trading levels from the over-the-counter markets.

The following table summarizes the financial liabilities measured at fair value on a recurring basis as of September 30, 2012 and 2011, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

 
2012
 
Total
 
Level 1
 
Level 2
 
Level 3
Assets, derivative financial instruments
$
134,050

 
$
134,050

 
$

 
$

 
 
 
 
 
 
 
 
 
2011
 
Total
 
Level 1
 
Level 2
 
Level 3
Assets, derivative financial instruments
$
292,375

 
$
292,375

 
$

 
$



 
v2.4.0.6
Employee Benefit Plan
12 Months Ended
Sep. 30, 2012
Compensation and Retirement Disclosure [Abstract]  
Employee Benefit Plan
Employee Benefit Plan
 
The Company adopted a 401(k) plan covering substantially all employees effective February 1, 2006.  The Company provides matching contributions of 50% for up to 6% of employee compensation.  Company contributions and plan expenses for the years ended September 30, 2012, 2011 and 2010 totaled $72,360, $65,495 and $69,069, respectively.
v2.4.0.6
Contingency
12 Months Ended
Sep. 30, 2012
Contingency [Abstract]  
Legal Matters and Contingencies
Contingency
 
In May 2010, a lawsuit was filed against the Company and approximately twenty other ethanol plants, design firms and equipment manufacturers by an unrelated party claiming the Company’s operation of the corn oil extraction system is infringing at least one patent. The plaintiff seeks injunctive relief, an award of damages with interest and any other remedies available under certain patent statutes or otherwise under law.  The Company is currently defending the lawsuit with legal counsel and has asserted various defenses including that it does not infringe and, further, that the patents are invalid.  The Company is unable to determine at this time if the lawsuit will have a material adverse affect on the Company.
v2.4.0.6
Sale of Property
12 Months Ended
Sep. 30, 2012
Sale of Property [Abstract]  
Sale of Property
Sale of Property

On October 5, 2011, the Company completed the sale of a land parcel adjacent to its primary site for a sales price of $1,181,000. A gain of $496,098 was recognized for the sale of property for the year ended September 30, 2012.
v2.4.0.6
Nature of Business and Significant Accounting Policies (Policies)
12 Months Ended
Sep. 30, 2012
Nature of Business and Significant Accounting Policies [Abstract]  
Use of estimates
Use of estimates:  The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.
Concentration of credit risk
Concentration of credit risk:  The Company’s cash balances are maintained in bank deposit accounts which at times may exceed federally insured limits.  The Company has not experienced any losses in such accounts.
Cash and cash equivalents
Cash and cash equivalents:  For the purposes of reporting the statement of cash flows, the Company includes as cash equivalents all cash accounts and highly liquid debt instruments which are not subject to withdrawal restrictions or penalties.  Certificates of deposit are considered investments as all have been purchased with maturities in excess of ninety days.  Although the Company maintains its cash accounts in one bank, the Company believes it is not exposed to any significant credit risk on cash and cash equivalents.  The Company has repurchase agreements with one bank, which totaled approximately $175,469 at September 30, 2012.  In accordance with the terms of the repurchase agreements, the Company does not take possession of the related securities.  The Company’s agreements also contain provisions to ensure that the market value of the underlying assets remain sufficient to protect the Company in the event of default by the banks by requiring that the underlying securities have a total market value of at least 100% of the bank’s total obligations under the agreements.
Trade accounts receivable
Trade accounts receivable:  Trade accounts receivable are recorded at original invoice amounts less an estimate made for doubtful receivables based on a review of all outstanding amounts on a monthly basis.  Management determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considering customers financial condition, credit history and current economic conditions.  Receivables are written off when deemed uncollectible.  Recoveries of receivables written off are recorded when received.  A receivable is considered past due if any portion of the receivable is outstanding more than 90 days.
Inventories
Inventories:  Inventories are stated at the lower of cost or market using the first-in, first-out method.  In the valuation of inventories and purchase and sale commitments, market is based on current replacement values except that it does not exceed net realizable values and is not less than net realizable values reduced by allowances for approximate normal profit margin.
Financing costs
Financing costs:  Financing costs are recorded at cost and include expenditures directly related to securing debt financing.  The Company is amortizing these costs using the effective interest method over the term of the agreement.  The financing costs are included in interest expense on the statement of operations.
Property and equipment
Property and equipment:  Property and equipment is stated at cost.  Construction in progress is comprised of costs related to the projects that are not completed.  Depreciation is computed using the straight-line method over the following estimated useful lives:

 
Years
Land improvements
20
Buildings and improvements
40
Plant and process equipment
5 – 20
Office furniture and equipment
3 – 7


Maintenance and repairs are expensed as incurred; major improvements and betterments are capitalized.  
Investments
Investments:  The Company has investments in financial service cooperatives.  These investments are carried at cost including allocated retained earnings of the cooperatives.
Derivative financial instruments
Derivative financial instruments:  The Company enters into derivative contracts to hedge the Company’s exposure to price risk related to forecasted corn needs, forward corn purchase contracts and ethanol sales.  The Company does not typically enter into derivative instruments other than for hedging purposes.  All the derivative contracts are recognized on the balance sheet at their fair market value.  Although the Company believes its derivative positions are economic hedges, none have been designated as a hedge for accounting purposes.   Accordingly, any realized or unrealized gain or loss related to corn derivatives is recorded in the statement of operations as a component of cost of goods sold.  Any realized or unrealized gain or loss related to ethanol derivative instruments is recorded in the statement of operations as a component of revenue. The Company reports all contracts with the same counter party on a net basis on the balance sheet.
Deposit
Deposit:  The Internal Revenue Service (under Section 7519) requires partnerships that elect a fiscal year over a calendar year to make a deposit each year.  The deposit is 25% of annual taxable net income, multiplied by the tax rate of 36% for the reporting fiscal year.
Revenue recognition
Revenue recognition:  Revenue from the sale of the Company’s ethanol and distillers grains is recognized at the time title and all risks of ownership transfer to the customers.  This generally occurs upon the loading of the product.  For ethanol, title passes at the time the product crosses the loading flange in either a railcar or truck.  For distiller’s grain, title passes upon the loading into trucks.  For railcar shipments, this takes place when the railcar is filled and the marketer receives written notice that they have been loaded and are available for billing.  Shipping and handling costs incurred by the Company for the sale of ethanol and distiller’s grain are included in costs of goods sold. Commissions for the marketing and sale of ethanol and distiller grains are included in costs of goods sold.
Income taxes
Income taxes:  The Company is organized as a partnership for federal and state income tax purposes and generally does not incur income taxes.  Instead, the Company’s earnings and losses are included in the income tax returns of the members.  Therefore, no provision or liability for federal or state income taxes has been included in these financial statements. Management has evaluated the Company's material tax positions and determined there were no uncertain tax positions that require adjustment to the financial statements. The Company does not currently anticipate significant changes in its uncertain tax positions over the next 12 months. Generally, the Company remains subject to income tax examinations by U.S. federal or state tax authorities for fiscal years 2009 and thereafter.
Earnings per unit
Earnings per unit:  Basic and diluted earnings per unit have been computed on the basis of the weighted average number of units outstanding during each period presented.
Fair value of financial instruments
Fair value of financial instruments:  The carrying amounts of cash and cash equivalents, derivative financial instruments, trade accounts receivable, accounts payable and accrued expenses approximate fair value.  The carrying amount of long-term debt approximates fair value because the interest rates are based on current rates offered to the Company for debt with similar terms and maturities.
Reclassification
Reclassification: Certain amounts in the 2011 balance sheet have been reclassified to be consistent with their 2012 presentation with no effect on net income.
v2.4.0.6
Nature of Business and Significant Accounting Policies (Tables)
12 Months Ended
Sep. 30, 2012
Nature of Business and Significant Accounting Policies [Abstract]  
Schedule of Property and Equipment, Estimated Useful Lives
Depreciation is computed using the straight-line method over the following estimated useful lives:

 
Years
Land improvements
20
Buildings and improvements
40
Plant and process equipment
5 – 20
Office furniture and equipment
3 – 7
Schedule of Revenue by Product
Revenue by product is as follows:
(Excludes hedging activity)

(In thousands)
 
2012
 
2011
 
2010
Ethanol
 
$
126,440

 
$
139,536

 
$
94,612

Distiller's Grain
 
38,564

 
31,716

 
19,434

Other
 
4,570

 
3,826

 
1,766

v2.4.0.6
Inventories (Tables)
12 Months Ended
Sep. 30, 2012
Inventory Disclosure [Abstract]  
Schedule of Inventory, Current
Inventories consist of the following as of September 30, 2012 and 2011:

 
2012
 
2011
Raw materials, including corn, coal, chemicals and supplies
$
2,048,130

 
$
3,956,604

Work in process
1,432,257

 
1,303,654

Ethanol and distillers grain
2,442,549

 
1,090,286

Total
$
5,922,936

 
$
6,350,544

v2.4.0.6
Long-Term Debt (Tables)
12 Months Ended
Sep. 30, 2012
Long-term Debt, Current and Noncurrent [Abstract]  
Schedule of Long-term Debt Instruments
(A)
The Company had a construction and term loan with a financial institution.  Borrowings under the term loan included a variable interest rate based on the one-month LIBOR index rate plus 3.30%.  The rate was reset automatically without notice to the Company, on the first “US Banking Day” of each succeeding week, and each change was applicable to all outstanding balances as of that date.  The agreement required 30 principal payments of $1,250,000 per quarter commencing in December 2006 through March 2013.  The agreement required the maintenance of certain financial and nonfinancial covenants.  Borrowings under this agreement were collateralized by substantially all of the Company’s assets.  On August 20, 2012, the $1,500,000 balance remaining on this loan was consolidated under the revolving term loan, described in (C) below, and this construction term loan was closed.

(B)
The Company had a $10,000,000 construction/revolving term credit facility with a financial institution which would expire on September 1, 2016.  Borrowings under the credit facility agreement included a variable interest rate based on the one-month LIBOR index rate plus 3.30%.  The rate was reset automatically without notice to the Company, on the first “US Banking Day” of each succeeding week, and each change was applicable to all outstanding balances as of that date.  Borrowings were subject to borrowing base restrictions as defined in the agreement.  The credit facility and revolving credit agreement required the maintenance of certain financial and nonfinancial covenants.  Borrowings under this agreement were collateralized by substantially all of the Company’s assets.  This credit facility was replaced with the revolving term loan, described in (C) below.

(C)
The Company entered into a new master loan agreement with a financial institution on August 20, 2012. One of the supplements of the agreement is a revolving term loan available for up to $5,000,000. The revolving term loan is to be used to provide working capital and to consolidate under the revolving term loan the remaining $1,500,000 that is outstanding under the construction term loan (A). The Company will pay interest on the unpaid balance at a variable interest rate (adjusted on a weekly basis) based upon the one-month LIBOR index rate plus 3.50%. The Company will also pay a commitment fee on the average daily unused portion of the loan at the rate of .60% per annum, payable monthly. The loan is secured by substantially all assets of the Company and subject to certain financial and nonfinancial covenants as defined in the master loan agreement. The term of the loan will expire, and the Company must pay all unpaid principal amounts outstanding under the revolving term loan, on June 1, 2017.
   
(D)
The Company also had a $300,000 loan agreement with the Iowa Department of Economic Development (IDED).  The $300,000 loan was noninterest-bearing and due in monthly payments of $2,500 beginning December 2006 and a final payment of $152,500 due November 2011.  Borrowings under this agreement were collateralized by substantially all of the Company’s assets and subordinate to the above financial institution debt and construction and revolving loan/credit agreements included in (A) and (B).  On October 5, 2011, the final payment of $152,500 was made by the Company.

(E)
The Company entered into a $500,000 loan agreement with the Iowa Department of Transportation (IDOT) in February 2005.  The proceeds were disbursed upon submission of paid invoices.  Interest at 2.11% began accruing on January 1, 2007.  Principal payments will be due semiannually through July 2016.  The loan is secured by all rail track material constructed as part of the plant construction.  The debt is subordinate to the above financial institution debt and construction and revolving loan/credit agreements included in (C) and Note 4.
Long-term debt consists of the following as of September 30, 2012 and 2011
 
2012
 
2011
Construction term loan.  (A)
$

 
$
1,500,000

 
 
 
 
Construction/revolving term loan.  (B)

 
1,000,000

 
 
 
 
Revolving term loan. (C)
3,237,000

 

 
 
 
 
Note payable to contractor, unsecured, interest-only quarterly
 

 
 

payments at 4% due through maturity date of December 2011.

 
1,250,000

 
 
 
 
Note payable to Iowa Department of Economic Development.  (D)

 
152,500

 
 
 
 
Note payable to Iowa Department of Transportation.  (E)
238,021

 
287,930

 
3,475,021

 
4,190,430

Less current maturities
(50,968
)
 
(1,452,409
)
 
$
3,424,053

 
$
2,738,021

Schedule of Maturities of Long-term Debt
Maturities of long-term debt as of September 30, 2012 are as follows:

Years ending September 30:
 
          2013
$
50,968

          2014
52,049

          2015
53,153

          2016
54,280

          2017
3,264,571

 
$
3,475,021

v2.4.0.6
Lease Commitments Lease Commitments (Tables)
12 Months Ended
Sep. 30, 2012
Leases [Abstract]  
Schedule of Future Minimum Rental Payments for Operating Leases
Approximate minimum lease payments under these operating leases for future years are as follows:
Years ending Sept 30:
 
          2013
$
1,594,000

          2014
1,075,000

          2015
635,000

          2016
630,000

          2017

 
$
3,934,000

v2.4.0.6
Risk Management (Tables)
12 Months Ended
Sep. 30, 2012
Risk Management [Abstract]  
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location
Derivatives not designated as hedging instruments as of September 30, 2012 and 2011 are as follows:

 
2012
 
2011
Derivative assets
$
134,050

 
$
292,375

Cash held by (due to) broker
(62,072
)
 
227,670

Total
$
71,978

 
$
520,045

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance
The effects on operating income from derivative activities is as follows for the years ending September 30, are as follows:

 
2012

 
2011

 
2010

Increase (decrease) in revenue due to derivatives related to ethanol sales:
 
 
 
 
 
Realized
$
(7,308
)
 
$
(2,655,034
)
 
$
45,434

Unrealized

 
1,528,367

 
(1,483,997
)
Total effect on revenue
(7,308
)
 
(1,126,667
)
 
(1,438,563
)
 
 
 
 
 
 
(Increase) decrease in cost of goods sold due to derivatives related to corn costs:
 

 
 

 
 

Realized
(1,134,488
)
 
(2,946,138
)
 
604,475

Unrealized
134,050

 
(44,125
)
 
849,475

Total effect on cost of goods sold
(1,000,438
)
 
(2,990,263
)
 
1,453,950

 
 
 
 
 
 
Total (decrease) increase  to operating income due to derivative activities
$
(1,007,746
)
 
$
(4,116,930
)
 
$
15,387

v2.4.0.6
Fair Value Measurements (Tables)
12 Months Ended
Sep. 30, 2012
Fair Value Disclosures [Abstract]  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis
The following table summarizes the financial liabilities measured at fair value on a recurring basis as of September 30, 2012 and 2011, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

 
2012
 
Total
 
Level 1
 
Level 2
 
Level 3
Assets, derivative financial instruments
$
134,050

 
$
134,050

 
$

 
$

 
 
 
 
 
 
 
 
 
2011
 
Total
 
Level 1
 
Level 2
 
Level 3
Assets, derivative financial instruments
$
292,375

 
$
292,375

 
$

 
$

v2.4.0.6
Nature of Business and Significant Accounting Policies Textuals (Details) (USD $)
12 Months Ended
Sep. 30, 2012
gal
D
Product Information [Line Items]  
Annual ethanol production 50,000,000
Securities sold under agreements to repurchase $ 175,469
Number of days outstanding for a past due trade receivables 90
v2.4.0.6
Nature of Business and Significant Accounting Policies Property and Equipment (Details)
12 Months Ended
Sep. 30, 2012
Land improvements [Member]
 
Property, Plant and Equipment [Line Items]  
Property and equipment, useful life 20 years
Buildings and improvements [Member]
 
Property, Plant and Equipment [Line Items]  
Property and equipment, useful life 40 years
Plant and process equipment [Member] | Minimum [Member]
 
Property, Plant and Equipment [Line Items]  
Property and equipment, useful life 5 years
Plant and process equipment [Member] | Maximum [Member]
 
Property, Plant and Equipment [Line Items]  
Property and equipment, useful life 20 years
Office furniture and equipment [Member] | Minimum [Member]
 
Property, Plant and Equipment [Line Items]  
Property and equipment, useful life 3 years
Office furniture and equipment [Member] | Maximum [Member]
 
Property, Plant and Equipment [Line Items]  
Property and equipment, useful life 7 years
v2.4.0.6
Nature of Business and Significant Accounting Policies Revenue by Product (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Sep. 30, 2010
Ethanol [Member]
     
Revenue from External Customer [Line Items]      
Revenue by product $ 126,440 $ 139,536 $ 94,612
Distiller's Grain [Member]
     
Revenue from External Customer [Line Items]      
Revenue by product 38,564 31,716 19,434
Other [Member]
     
Revenue from External Customer [Line Items]      
Revenue by product $ 4,570 $ 3,826 $ 1,766
v2.4.0.6
Members' Equity (Details) (USD $)
0 Months Ended
May 20, 2004
Capital Unit [Line Items]  
Sale of membership units (in units) 1,924
Sale of membership units $ 962,000
Authorized of membership units without member approval (in units) 45,608
v2.4.0.6
Inventories (Details) (USD $)
Sep. 30, 2012
Sep. 30, 2011
Inventory Disclosure [Abstract]    
Raw materials, including corn, coal, chemicals and supplies $ 2,048,130 $ 3,956,604
Work in process 1,432,257 1,303,654
Ethanol and distillers grain 2,442,549 1,090,286
Inventory total 5,922,936 6,350,544
Inventory valuation reserves $ 368,000  
v2.4.0.6
Revolving Credit Loan (Details) (USD $)
0 Months Ended
Aug. 20, 2012
Sep. 30, 2012
Aug. 19, 2012
Sep. 30, 2011
Line of Credit Facility [Line Items]        
Line of credit facility, maximum borrowing capacity     $ 10,000,000  
Basis spread on variable rate 3.50%      
Line of credit facility, unused capacity, commitment fee percentage 0.60%      
Line of Credit Facility, Amount Outstanding   200,000   0
Revolving Credit Loan [Member]
       
Line of Credit Facility [Line Items]        
Line of credit facility, maximum borrowing capacity 10,000,000      
Line of Credit Facility, Remaining Borrowing Capacity 9,400,000      
Description of variable rate basis LIBOR      
Basis spread on variable rate 3.25%      
Line of credit facility, unused capacity, commitment fee percentage 0.30%      
Line of Credit Facility, Amount Outstanding   $ 200,000    
v2.4.0.6
Long-Term Debt (Details) (USD $)
0 Months Ended 8 Months Ended 12 Months Ended
Aug. 20, 2012
Oct. 05, 2011
Aug. 19, 2012
Sep. 30, 2012
Sep. 30, 2011
Debt Instrument [Line Items]          
Construction term loan       $ 0 $ 1,500,000
Construction revolving term loan       0 1,000,000
Revolving term loan       3,237,000 0
Note payable to contractor, unsecured, interest only       0 1,250,000
Note payable to Iowa Department of Economic Development       0 152,500
Note payable to Iowa Department of Transportation       238,021 287,930
Long-term debt, total       3,475,021 4,190,430
Less current maturities       (50,968) (1,452,409)
Long-term debt, less current maturities       3,424,053 2,738,021
Debt instrument, interest rate terms     3.30% 3.30%  
Debt instrument, periodic payment, principal       1,250,000  
Line of credit facility, maximum borrowing capacity     10,000,000    
Revolving term loan, maximum borrowing capacity 5,000,000        
Basis spread on variable rate 3.50%        
Line of credit facility, unused capacity, commitment fee percentage 0.60%        
Promissory note - IDED       300,000  
Note payable - IDED - monthly payments         2,500
Note payable - IDED - final payment   152,500      
Railroad revolving loan fund       500,000  
Debt instrument, interest rate, stated percentage       2.11%  
Maturities of Long-term Debt [Abstract]          
2013       50,968  
2014       52,049  
2015       53,153  
2016       54,280  
2017       $ 3,264,571