Using responses from a mail survey conducted among 203 South Dakota grain elevator managers in 2002, we analyzed the degree to which their elevators were prepared to segregate non-transgenic from commodity grains. Results showed four percent of the managers expected their own, and ten percent expected a competing elevator be dedicated to handling only non-transgenic or identity preserved grains within five years. Only four and one percent of the elevators handled non-transgenic corn and soybeans, respectively, and only one percent participated in identity preserved grains. One in five elevator managers in the state reported having tested corn for transgenic material, and none of the respondents conducted any genetic testing for soybeans in 2001. Further, 17 and two percent reported having buyers inquire about segregated non-transgenic or identity preserved corn, and such soybeans, respectively. Among those handling corn (soybeans), 29 (30) percent was familiar with the non-transgenic corn (soybean) market and 53 (58) percent was willing to participate in these markets at an average premium of 28 (37) cents per bushel. One in five elevators are able to participate in segregating non-transgenic and commodity grains without additional capital outlays. Thus, if a sizable demand for non-transgenic grains develops, the South Dakota grain handling industry appears ready to deal with it.