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Interstate Commodities Inc.: Decades of Family Ownership and Value-added Service
Victor Oberting Sr. began to build his family legacy after many years of working for the Seagram’s whiskey distillery in Lawrenceburg, Ind. Victor established Interstate Commodities Inc. (ICI) in 1947 by purchasing distillery grains and selling to the feed industry throughout the eastern U.S. More than 66 years later, the operation has expanded throughout the country, and is now in the hands of third-generation Greg Oberting, Gary Oberting and Victor Oberting 111.
The Next Generation of Success
“I took over from my father, Victor Oberting Jr., in 2005,” recalls Greg. “I was always interested in the family business, but after going to college and studying economics and marketing I felt as though my skills were well-suited for ICI. I was very fortunate to enter a company I had ownership in and the open book to make what I wanted out of it. Very few companies are lucky enough to remain in family hands, especially once they’ve reached our size.”
Greg has focused on expanding ICI through value-added service in agricultural commodity transportation and logistics. “Over the course of time we’ve grown the company, but we’ve experienced the most significant growth over the last decade,” he explains. “However, what’s always remained constant is our close, family ownership and value-added service. We’re always looking to add value to the supply chain with each customer, while most peers in the agriculture industry focus purely on price; we see that as our strategic advantage.”
Today ICI operates out of three locations in Troy, N.Y., Omaha, Neb., as well as Jacksonville, Fla. “ICI is the parent company of our two subsidiaries, RM Railcars LLC [RM Railcars] based in New York and Watseka Interstate LLC [Watseka Interstate] in Illinois,” details Greg. “Through our subsidiaries and various acquisitions we’ve been able to dramatically expand our footprint throughout the U.S.”
Watseka Interstate serves as ICI’s core agronomy, field management and seed supplier, while also handling grain storage operations. Additionally, RM Railcars, which was founded in 2001, operates as a full-service railcar leasing and management entity, running more than 6,000 privately owned railcars throughout North America. The subsidiary provides railcar management, involving tracking, reporting, tax service and mobile repair service.
Influential from East to West
ICI’s services truly span the U.S., from the Atlantic states to the Gulf Coast to the Midwest and beyond. “Aside from our three main locations, we operate various branches throughout the country,” shares Greg. “We have five railcar shops spread across Illinois, Michigan, Ohio and Oklahoma, along with fertilizer and grain storage and distribution sites in New York, Pennsylvania, Florida, Ohio, Illinois, South Dakota and California.”
Greg admits ICI is aggressively growing by taking full advantages of business development opportunities wherever present. In May 2013 ICI saw an opportunity to purchase the then-failing Gregory Farmers Elevator in South Dakota.
“We’ve had a lot of success with rescuing failed cooperatives in the past,” he details. “We organized a rescue package to secure creditors and came to an agreement with members to transition the Gregory Farmers Elevator to our organization. It was a win-win situation, because we saved the cooperative without injuring its reputation, something that’s very valuable in this business.”
Greg reveals ICI has also acquired two other assets in South Dakota, a sourcing agreement for an Ohio ethanol plant, as well as operating two large-scale grain elevators in Ohio. “We’re working with Trillium Farms in Johnstown, Ohio, which is one of the largest egg producers in the Midwest with over 12 million laying hens,” he reveals. “We’re supplying all of their grain by directly operating the elevators.”
ICI’s presence in Ohio and impact on overall corn trading in the U.S. is significant. “We’ve become one of the largest consumers of rail corn, supplying to end-users all over the country,” notes Greg. “Between ICI’s local truck demand and rail origination, we’re consuming over 20 percent of all the corn that’s produced in Ohio.”
The company’s Omaha branch has also recently established a corn sourcing relationship with Plymouth Energy (Plymouth) in Merrill, Iowa. ICI will manage all corn settlements and oversee logistics for Plymouth. “Our focus on logistics and transportation services and not so much on volume set us apart from others in this industry,” says Greg. “We’re more customized than most.”
The company’s recent growth through acquisitions and partnerships has allowed for expansion while ICI remains grounded in storage and transportation operations. “These type of fixed-fee-based revenue streams are a good balance for our grain and trading storage operations,” says Greg. “By focusing on cost-effective solutions and value-added service, we’ve earned the respect of some large national companies.”
ICI is currently focusing on Food and Drug Administration Food Safety Certification and Hazard Analysis and Critical Control Point (HACCP) programs. “We’re also building committees for human resources, information technology, administrative training, credit and collections and contract management,” details Greg.
Greg admits ICI’s growth has been remarkable over the last 10 years and sees more of the same success in the company’s future. “When I started we had just 10 employees,” he recalls. “Now we have 100 and are doing over $2 billion in annual sales, all while remaining a family-centered operation.”
Interstate Commodities Inc. continues to provide value-added agriculture management and logistics for numerous clients across the U.S., with the third-generation Oberting drive.
For more information about Interstate Commodities Inc., please visit: www.icigrain.com.