EXHIBIT 20
LETTER TO STOCKHOLDERS
                                                                             

November 7, 1996

Dear Stockholder:

I am pleased  to report  that while our  Company  incurred a slight  loss in net
earnings in the first quarter of fiscal 1997, our operating income moved back to
the  plus  side.  This  is  consistent  with  strengthened   conditions  in  the
marketplace, which indicate a return to profitability in the second quarter.

Our  first  quarter  net  loss of  $346,000,  or  $0.04  per  share  on sales of
$53,173,000  represented a substantial  improvement  over the prior year's first
quarter net loss of $2,377,000,  or $0.24 per share on sales of $47,160,000.  It
also was  better  than our  performance  in the  immediately  preceeding  fourth
quarter, when we experienced a net loss of $814,000, or $0.08 per share on sales
of $37,856,000. This improvement was realized as the result of a greater balance
between  selling  prices of our  principal  products and raw material  costs for
grain  together  with  our  ability  to  exercise  considerable  flexibility  in
targeting  production levels and sales mixes. Those factors were complemented by
the continuation of our enhanced cash management program.

First quarter grain costs  actually were much higher than during the same period
a year ago.  Prices for corn and milo,  which we use in our  alcohol  production
process,  averaged 54% more per bushel,  while  prices for wheat,  which we mill
into flour and then further  process  into vital wheat gluten and premium  wheat
starch,  averaged  nearly 7% more per bushel.  These  increases  were  partially
offset by sales price adjustments in each of our markets.

The  combination  of higher  grain  costs and  relatively  flat prices for wheat
gluten and fuel alcohol in the opening weeks of the first  quarter  prompted our
decision to extend a  maintenance  and repair  shutdown  at our Pekin,  Illinois
plant through the first half of July. Although production levels

declined as the result of this shutdown, the decision allowed us to minimize the
negative  impact of the  exceptionally  high grain  costs.  Furthermore,  as the
quarter  progressed,  demand  for our fuel  alcohol,  as well as our food  grade
alcohol for beverage and  industrial  applications  strengthened.  Conditions in
these markets remain favorable,  and corn and milo prices have fallen from their
July record levels.

Conditions  in the wheat  gluten  market,  on the  other  hand,  continue  to be
severely  affected by the growing  presence of gluten  imports from the European
Union  (E.U.).  Consultations  between  the United  States  and E.U.,  which are
expected  to help level the playing  field,  have not yet been  completed  as we
previously had hoped. In the meantime,  possibilities for a remedy through legal
action are being aggressively explored.

As previously  reported,  we are accelerating our development of specialty wheat
gluten products for both food and industrial  applications.  The growth of these
products  will be  gradual,  as has been the case  with our  successful  list of
modified and specialty wheat starches,  which we began developing  several years
ago.




Looking  ahead,  I  am  encouraged  by  the  current  onset  of  more  favorable
conditions,  both on the raw material side and in the majority of the markets we
serve.  Our production  capabilities  and the higher  efficiencies  we expect to
attain should allow us to realize improved results as we go forward.

Sincerely,


s/Ladd M. Seaberg

Ladd M. Seaberg
President and CEO