Steve Markham, this year’s winner of EPM’s High Octane Award, and director of risk for CHS Inc, is a family man. He’s proud of his kids’ accomplishments and says that the reason he’s worked so hard growing markets for distillers grains for the past three decades is his family. “Truly, my motivation has always been my family,” Markham says.

And in some ways, the team he works with has become like family. He notes that many of his current team members have worked with him for more than 10 years. Recognizing the efforts of his team is important, he says, as he accepted the High Octane Award on behalf of the people he works with and for. “We’ve got a very experienced, very capable team of people. It’s not just me.”

Markham began his career in marketing distillers grains after graduating from South Dakota State University, where he played football on scholarship. After graduating, Markham worked at Pillsbury, which at that time had more agricultural assets. He spent 12 years there. “That’s where I learned the craft,” he says. He adds much of what he learned came from senior trader John Wood. “He taught me everything I needed to know and still use today,” Markham says. "We were trading wheat middlings, a coproduct of the flour milling industry used in animal feed. It is very different from DDGS nutritionally but trades in a similar fashion."

When Pillsbury began selling its agricultural divisions, the feed ingredient division was up for grabs. Markham and several of his colleagues purchased the division and formed Commodity Specialists Company, which traded DDGS, among other commodities. Markham spent another 12 years at CSC before the company's DDGS business was bought by CHS, where he’s remained for the past 13 years. “CHS really wanted to be in the distillers grains business,” Markham says, adding that CSC was the biggest DDGS marketer, by volume, when it was acquired.

Sean Broderick has worked with Markham for over 30 years. The pair began working together at Pillsbury and then continued that relationship at CSC. It was there that Broderick says Markham helped educate buyers and build new markets for DDGS. “Early on, unless you were close to an ethanol plant, you probably did not know very much about DDGS—you had to explain to customers what it was before they would even look at it,” he says. “Steve’s knowledge of animal nutrition and his consensus-building that involved the university research … helped to expand the market early on.”

And when Markham reflects on his career, he sees parallels between the early days of marketing dried distillers grains, and the current high-protein feed products that are growing in popularity. “It’s new and different, and for me it’s fun. It’s kind of like the old days when nobody knew what distillers grains was. Now we’ve got this high-pro product and nobody knows what it is,” Markham says. “Challenges are opportunities.”

One of those opportunities is marketing high-protein feed to the aquaculture industry, he says.  “It was a couple years ago, our company, in conjunction with the U.S. Grains Council, put on an aquaculture conference where we showcased our high-pro product in the Philippines, and invited a bunch of nutritionists and feed manufacturers in for it. You’ve got to teach them. ‘Here’s what we’ve got, and here’s how it works, and here’s the research to back it up,’” Markham says.
In the early days, Markham says the challenge was finding enough buyers for distillers grains.

“The volume that came on in a very short period of time was challenging,” he says, adding that in the 1980’s there were just a few plants producing DDGS. Today, the U.S. ethanol industry has the capability to produce more than 40 million metric tons of distillers grains a year, which is considerably more than the country can use. About a third of the volume is now exported, but establishing overseas markets didn’t happen overnight.  

For years, Markham was among those in the industry who worked with trade groups and the U.S. Grains Council to find new markets for DDGS. “Finding export options was a big challenge,” he says, adding that some of those challenges include freight, logistics and governmental regulations. But a larger challenge was just spreading the word about DDGS. “We spent a lot of time flying over to countries and taking Ph.Ds in nutrition with us,” Markham says. “That’s one of the advantages of doing research: it’s kind of like advertising. Well, then you’ve got to go tell people about it.”

Another early challenge Markham says, was just moving distillers grains. Many ethanol plants were shipping the coproduct by truck, and so when volume increased, the industry shifted to shipping by rail, unit trains, barge, vessel and containers, each of which had its own logistical issues that Markham and his team helped work through.

Renewable Fuels Association President and CEO Geoff Cooper says Markham’s efforts haven’t gone unnoticed. “Throughout a career that has spanned four decades, Steve has been a leader in developing new markets and expanding existing markets around the world for both ethanol and distillers grains,” Cooper says. “But he’s more than a marketer. Steve is a thoughtful industry leader and a tremendously effective advocate for ethanol producers and farmers.”

Back home, current market trends with new processes and high-protein feed products are opening opportunities in aquaculture and pet food industries, Markham says. “Clearly, the coproduct line is becoming more diverse, and it always has been. Finding the right market for this diverse coproduct is our challenge,” Markham says. “A lot of these products have opened more of a line into the pet food and aquaculture industries. When you get into these high-protein, high-yeast products, you get a lot more interest from the pet food people.”

And that diversity, in addition to family, is worth going to work everyday, he says. “That’s what keeps it interesting,” Markham says. “To be in an industry that’s growing is way more challenging, but way more fun.”


Author: Matt Thompson
Questions: editor@bbiinternational.com