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Marketing and Distribution Segment
The Company has an in-house marketing business, Green Plains Trade Group LLC, that is responsible for the sales,
marketing and distribution of all ethanol, distillers grains and corn oil produced at the Company’s nine ethanol plants. This
marketing business also markets and distributes ethanol for third-party ethanol producers. At capacity, the Company would
market approximately 740 mmgy of ethanol from its nine ethanol plants along with approximately 260 mmgy from third-
party producers. Additionally, through its wholly-owned subsidiary, BlendStar LLC, the Company operates nine blending or
terminaling facilities with approximately 625 mmgy of total throughput capacity in seven south central U.S. states.
Agribusiness Segment
The Company owns and operates grain handling and storage assets and provides complementary agronomy services to
local grain producers through its agribusiness segment, primarily through its wholly-owned subsidiary, Green Plains Grain
Company LLC, which has three primary operating lines of business: bulk grain, agronomy and petroleum. In addition to
storage capacity at the Company’s ethanol plants, Green Plains Grain has 15 grain elevators with approximately 39.1 million
bushels of total storage capacity, which supplies a portion of the feedstock for the Company’s ethanol plants; sells fertilizer
and other agricultural inputs and provides application services to area producers through its agronomy business; and sells
petroleum products including diesel, soydiesel, blended gasoline and propane, primarily to agricultural producers and
Cash and Cash Equivalents and Restricted Cash
The Company considers short-term highly liquid investments with original maturities of three months or less to be cash
equivalents. Cash and cash equivalents as of December 31, 2011 and 2010 included bank deposits. The Company also has
restricted cash which is comprised of cash restricted as to use for payment towards a revenue bond and cash restricted as to
use for payment towards a revolving credit agreement.
Revenue Recognition
The Company recognizes revenue when all of the following criteria are satisfied: persuasive evidence of an arrangement
exists; risk of loss and title transfer to the customer; the price is fixed and determinable; and collectability is reasonably
For sales of ethanol and distillers grains by the Company’s marketing business, revenue is recognized when title to the
product and risk of loss transfer to an external customer. Revenues related to marketing operations for third parties are
recorded on a gross basis in the consolidated financial statements as Green Plains Trade takes title to the product and assumes
risk of loss. Unearned revenue is reflected on the consolidated balance sheets for goods in transit for which the Company has
received payment and title has not been transferred to the customer. Revenues from BlendStar’s biofuel terminal operations,
which include ethanol transload and splash blending services, are recognized as these services are rendered.
The Company routinely enters into fixed-price, physical-delivery ethanol sales agreements. In certain instances, the
Company intends to settle the transaction by open market purchases of ethanol rather than by delivery from its own
production. These transactions are reported net as a component of revenues. Revenues also include realized gains and losses
on related derivative financial instruments, ineffectiveness on cash flow hedges, and reclassifications of realized gains and
losses on effective cash flow hedges from accumulated other comprehensive income (loss).
Sales of agricultural commodities, fertilizers and other similar products are recognized when title to the product and risk
of loss transfer to the customer, which is dependent on the agreed upon sales terms with the customer. These sales terms
provide for passage of title either at the time shipment is made or at the time the commodity has been delivered to its
destination and final weights, grades and settlement prices have been agreed upon with the customer. Shipping and handling
costs are presented gross in the statements of operations with amounts billed included in revenues and also as a component of
cost of goods sold. Revenues from grain storage are recognized as services are rendered. Revenues related to grain
merchandising are presented gross.