DUNKERTON - The people of Dunkerton know something about survival. So does its grain cooperative.

Natural disasters, it seems, ravage Dunkerton too often. Two floods and a tornado hit the community and surrounding area last year alone, destroying or damaging numerous homes and businesses.

Yet, urban and rural residents band together to persevere. The desire to adapt and overcome must be contagious.

As single-location grain elevators and cooperatives disappear in Iowa, the Dunkerton Co-op continues to grow.

The co-op spent millions of dollars within the last few years on expansion projects. The business celebrates its 65th anniversary this year, and employees and members look forward to several more decades of success.

"I'm thankful the board is willing to invest in the future so I have a place to do business," said John Hoffman, a rural Waterloo farmer and co-op member. His grandfather, Ray Hoffman, Sr., was one of the original organizers.

Co-op officials say the willingness to re-invest in the business, expand and meet customer needs kept it from getting caught up in the consolidation movement. A half a century ago, most Iowa towns had their own elevator or co-op.

That started to change with the evolution of agriculture. As farms became bigger, requiring additional services, independent grain, feed and seed companies became regional conglomerates.

The Iowa Institute for Cooperatives said there are only 13 single-location co-ops in the state as of Monday, and two are in serious merger discussions due to financial problems.

David Holm, executive director of the institute, said the Dunkerton Co-op proves better always doesn't mean bigger.

"Members support it and it meets their needs," Holm said. "If those two are being done, there's no reason why it won't survive."

The concept behind the cooperative - farmers helping themselves for the common good - hasn't changed much since 1944, said general manager Harlyn Vander Linden. When the town's two private elevators sold out, feed prices soared due to the lack of competition and the closest place to market grain was in Waterloo.

About 50 area farmers banded together to help themselves. The co-op provided a local market for grain and feed, which financially benefited its members.

Today, a similar mind-set exists.

"We don't try to get in the survival mode," Vander Linden said. "We're proactive rather than reactive. That's what's done well for us."

The co-op has about 300 farmer-members. When people who utilize the co-op's gasoline and dust-control services are figured in, officials said the customer base swells to about 1,200.

Spending profits wisely is the key to success, and co-op officials say members aren't afraid to reduce yearly dividend checks to make their jobs easier and hopefully reap a financial windfall in the future.

Some of the major spending projects in the last decade include:

Two 300,000-bushel grain bins and 25 acres of land for a little more than $1.3 million.

Upgraded rail service for $1 million.

A $425,000 temporary grain bunker. A 400,000-bushel bin was also built.

Building a 1.3 million covered grain storage bunker for $1.3 million.

Purchasing Landmark Ag, formerly Marv's Feed and Seed, for $1.4 million.

Constructing a 12,000-ton bulk dry fertilizer facility for $2.5 million.

In today's economic climate, Vander Linden said spending millions of dollars is a concern. But he said it was money well spent.

"We didn't do anything the customer said they didn't need," Vander Linden said.

Increased yields and corn acres this decade meant too much grain was being stored outdoors exposed to the elements, Vander Linden said. To protect grain, more covered storage was built or acquired. The co-op now boasts more than 5 million bushels of capacity.

Farmers can harvest more acres per day with modern equipment. In response, the co-op purchased Landmark, which doubled its grain drying and intake capabilities to speed up harvest. Corn drying capacity increased to 90,000 bushels per day, which allowed deliveries to continue into the afternoon this fall instead of being shut down in the morning, officials said.

"With a fall like (we had), that was important," Hoffman said, referring to a late harvest and wet corn.

A second grain dumping facility also allows the co-op to accept identity-preserved grain, like Asoyia soybeans, at harvest. This gives members with specialty grain contracts even more flexibility, said Wil Manwieler, the co-op's grain merchandiser.

To keep up with the needs of farmers working more ground, the co-op recently finished a new multi-million dollar dry fertilizer storage facility. The first train with bulk fertilizer was unloaded on New Year's Eve day and New Year's Day.

The co-op will also sell dry fertilizer to nearby elevators and cooperatives to help pay for the project, and eventually serve as a revenue source.

"This allows more product availability," Manweiler said.

Two of the best decisions to insure the company's long-term stability was the expansion of the co-op's feed mill in 1993 and rail service a decade later, officials said.

Feed production increased from 50 tons to 350 tons per day to meet the burgeoning needs of the hog industry. Corn use ballooned to 50,000 bushels a week, increasing demand for grain farmers.

"That's something the creates revenue every single day," Hoffman said.

More product can be shipped or received via rail at a lower cost compared to truck, officials said. It also opens up more markets.

Getting to this point wasn't easy. Like the town, the co-op has endured its share of problems and disasters.

According to co-op records, financing problems almost stalled the construction of the feed warehouse and grain pit in 1946. Four directors put up $5,000 to save the project.

A year later, a fire swept through the business. The water used to extinguish the blaze ruined all the feed.

In 1966, a special audit revealed the co-op was on the brink of bankruptcy. Records show that directors didn't take advice from financial experts to let the business go into receivership. Instead, co-op officials turned the company around.

During the flood of 1968, the co-op sustained $30,000 worth of damage when three feet of water destroyed records and most of its soybeans.

Yet, the co-op has survived and is the town's second largest employer after the school and accounts for a significant portion of the town's tax base. It has 30 employees.

And there's no plans to sit still. Vander Linden would like to increase grain drying capacity again to keep and maybe increase the co-op's customer base.

"We're always doing something," Vander Linden said. "I have people in town say it's interesting to see what we'll do next."

Contact Matthew Wilde at (319) 291-1579 or matt.wilde@wcfcourier.com.