Exhibit 20
                                November 11, 1997
Dear Stockholder:

While our earnings for the first quarter of fiscal 1998 were negatively affected
by a further  decline in wheat  gluten  selling  prices,  our cash  position was
bolstered by increased sales of alcohol  products.  As a result, we were able to
reduce our debt to approximately  $26 million during the quarter.  Since the end
of the quarter, debt has been reduced an additional $1 million.

The fall in gluten  prices  was caused by the  predatory  pricing  practices  of
subsidized  producers from the European Union (E.U.), who continue their program
of unloading excess gluten in the U.S.  market.  Due principally to this factor,
our  Company  experienced  a first  quarter net loss of  $235,000,  or $0.02 per
share, on sales of  $57,623,000.  For the first quarter of fiscal 1997, we had a
net loss of $346,000, or $0.04 per share, on sales of $53,173,000.

To reduce the  severity of E.U.'s  damaging  tactics,  and yet maintain a stable
customer base, we have stayed with our strategy to limit our production of wheat
gluten until conditions allow otherwise. At the same time, we are taking part in
a recently launched  initiative under Section 201 of the Trade Act of 1974 in an
effort to help put an end to this unfair situation.

On September 19, the Wheat Gluten Industry  Council of the United States filed a
petition  with  the  International  Trade  Commission  (ITC)  that  asks for the
establishment of a four-year quota for each country exporting gluten to the U.S.
The ITC has up to four months from September 19 to review the situation and make
an injury  determination.  Within six months of the filing, the ITC must deliver
its remedy  recommendation to President Clinton.  The President then must act on
the ITC recommendation by May 18, 1998.

Although  the  establishment  of quotas  under  Section 201 would  provide  only
temporary relief, it would give us and other U.S. wheat gluten producers time to
bring stability back to the marketplace  while seeking a more lasting  solution.
This conceivably  could be accomplished  through U.S.  government  consultations
with  the  E.U.  pursuant  to the  1996  Grains  Agreement,  as well as the GATT
negotiations in the year 2000.

As we wage our battle on the gluten front,  we are continuing to make strides in
optimizing our alcohol  production  capabilities at both of our plants.  This is
reflected by the increased  alcohol  production  and sales we experienced in the
first  quarter  compared  to the same  period a year  ago.  We also  experienced
increased sales of our premium wheat starch, with the largest percentage of that
increase occurring in sales of our non-modified varieties. Sales of our modified
wheat starches,  which have been developed for unique,  value-added uses, remain
steady  and we  continue  to work  with  customers  in  matching  these  special
ingredients to functional needs in new product formulations.

Much  time and  effort  are  being  spent as well  toward  the  development  and
marketing of our modified  wheat gluten  products,  which can be used to replace
other  grain-based  and/or  animal-based  proteins  in both food and  non-food
applications.  We expect these  ingredients to eventually  become very important
products for Midwest Grain, both in terms of revenue and in helping to shape our
Company into a less commodity-oriented, more value-added producer.

Sincerely,
s/Ladd M. Seaberg
Ladd M. Seaberg
President and CEO