HeartBeat Summer 2012 by FCS Financial

HeartBeat summer 2012

Optimism.

This farm familyâ&#x20AC;&#x2122;s mantra.

Board of Directors â&#x20AC;&#x201D; FCS Financial ACA James Nivens, LaRussell, Chairman

Dan Devlin, Edina

Mark S. Pierce, DeKalb, Vice Chairman

Maurice Glosemeyer, Marthasville

Kenneth Bergmann, Walnut Grove

Daniel Hulse, Hannibal

Bruce Bjornson, Oro Valley, Ariz., Appointed

Sherry Jones, Dawn

Michael L. Bruce, Nevada

David Meneely, Chillicothe, Appointed

Michael L. Cook, Columbia, Appointed

Gene H. Rademacher, Bland

James Davis, West Plains

Rick Rehmeier, Augusta

Mark DeShon, Clarksdale

Office Locations Bolivar 417-326-4016 1-866-326-4016 Cameron 816-632-7265 1-800-225-6949 Chillicothe 660-646-5044 1-800-264-3276 Clinton 660-885-8164 1-866-885-8164 Columbia 573-449-5910 1-800-241-5910 Farmington 573-756-5747 1-800-276-8120 Hannibal 573-221-0273 1-800-798-0273 Harrisonville 816-884-3061 1-800-517-3348 Higginsville 660-584-7181 1-866-584-7181 Jefferson City 573-636-7131 1-800-292-7131 Lebanon 417-588-5828 1-866-588-5828 Macon 660-395-1940 1-800-432-2156

Marshall 660-886-6897 1-800-228-6897 Maryville 660-582-6464 1-800-813-5722 Mexico 573-581-3192 1-800-314-3192 Mt. Vernon 417-466-7101 1-866-466-7101 Neosho 417-451-6084 1-866-451-6084 Nevada 417-667-8206 1-888-667-9681 Oâ&#x20AC;&#x2122;Fallon 636-327-1787 1-800-379-3276 St. Joseph 816-279-2118 1-866-279-2118 Sedalia 660-827-5810 1-800-310-5810 Springfield 417-862-4158 1-866-862-4158 Union 636-583-5400 1-800-583-5480 West Plains 417-256-2298 1-866-256-2298

Cover Kevin & Jeanie Young; Rick Gillenwater

Publication Information CEO: Daryl Oldvader Editor: Amy Wieberg, amy.wieberg@myfcsfinancial.com HeartBeat is published three times a year by FCS Financial. Please address any comments to FCS Financial, Attn: HeartBeat Editor, 1934 E. Miller St., Jefferson City, MO 65101. For more information about FCS Financial or to access your account online, visit myfcsfinancial.com

Member Cooperative Communicators Association

HEARTBEAT | SUMMER 2012

Printed with farmer-grown soybean ink on recycled paper.

table of contents 4

Daryl’s Desk

Member Feature

11 New Office in Columbia 12 Youth in Ag 15 Life is Simple 16 Dollars & Cents 18 Risk Management Above Find out how Young Farms, Inc., stands strong amid two consecutive years of flooding and crop loss. Pictured (l-r) are: FCS Financial crop insurance specialist Corey Neill, Jeanie Young, Kevin Young, FCS Financial’s Chad McCollough and Rick Gillenwater. Photos by Joann Pipkin

19 News Briefs • • • • • • •

Apply for ALOT Dr. Cook Award Customer Appreciation 4-H Endowment Director Election Results Jones Appointed to Board And more!

27 Nivens’ Notes HEARTBEAT | SUMMER 2012

daryl’s desk Daryl Oldvader, CEO

Greetings – Recently I was invited to participate in the Breimyer Seminar sponsored annually by the University of Missouri’s College of Agriculture, Food and Natural Resources. It has become known as a “think tank” regarding crucial issues related to agriculture. The title of this year’s seminar was Farmland Prices: Is this the start of a bubble? Admittedly, I had difficulty understanding why I would be invited to speak at a think tank until I received my topic: Are lenders smarter today? Since “smarter” is a relative term, I felt somewhat trapped that any answer creates an admission of guilt. Regardless, I decided to bite the bullet and declare on behalf of all lenders that we are smarter today than during the period of time encompassing the 1980’s agricultural crisis. Here are a few of the key “smarter” characteristics which hopefully distinguish most agricultural lenders from the challenging days of the eighties. First, like our customers, lenders have taken the opportunity in a strong agricultural economy to 4

HEARTBEAT | SUMMER 2012

build capital. While most regulators require relatively modest levels, lenders have heeded the call to increase capital levels to sustain the institution during economic downturns. Leverage and liquidity have become more common terms in both borrower and lender balance sheet management. The added safeguard in this area was evident as the rural financial institutions fared much better during the 2008 financial crunch compared to their big city counterparts. Today, with the evolution and integration of technology, lenders have a much greater degree of loan portfolio management capability related to the current and future health of loans. By analyzing relevant data, lenders can determine industry concentrations and maximum loan levels for various enterprises and operations. Additionally, adverse trends can readily be identified resulting in pre-emptive actions versus reactions. Looking from a “global” perspective provides the lender with a more realistic view of the economic dynamics on the health and welfare of the institution. With guidance from i nter n at ion a l a nd n at ion a l regulatory agencies such as the Farm Credit Administration, lenders have created greater consistency and granularity in loan classifications and standards. Today, unlike the eighties, there are risk mitigation tools “from farm to finance” with crop and livestock insurance, loan guarantees by state and federal agencies as well as secondary market opportunities for some farm loans. After the debacle of the eighties, lenders were challenged to look at

their processes and controls. This has generally resulted in better lines of accountability as well as specialization within the staff related to marketing, analysis, valuations, and monitoring. Some institutions, like FCS Financial, have their own staff of highly trained and certified land appraisers. Finally, like the producers we serve, the business planning process has become an integral part of lender evolution. Anticipating conditions or simulating adversity provides financial institutions with the opportunity to identify capital and liquidity requirements under distressed conditions such as an increase in delinquencies, nonaccrual loans, and loan charge-offs. While all these developments cou ld a rg uably ma ke lenders “smarter” today, they will not eliminate risk or pre vent a n economic calamity. Volatility has become the new buzzword for today’s environment. The opportunity for major economic g yrations a re more preva lent today as a result of geopolitical events, government policy, energy uncertainties, currency values and global health (i.e., exports) – to name a few. So the challenge for any lender is to ensure that their financial institution meets the safety and soundness test and loanable funds are available to creditworthy borrowers regardless of the economic climate. This has been the trademark of FCS Financial and the Farm Credit System for more than 95 years. Thank you for your business.

FCS Financial rolls out new Look for online Account access! A simpler, easier to navigate system is available for FCS Financial customers to conduct their business securely online. Some of the improvements include: Redesigned welcome page; • “I would like to...” links on the welcome page to make a payment, transfer funds, make disbursements, add bank accounts, pay FCS Financial bills now, and see FCS Financial statements and bills; • Bank account information can be set up one time and used for ACH payments or disbursements; and • Quick view of account summary information on the welcome page. If you have any questions, please contact us at 1-866-450-2308 or fcsfolb@myfcsfinancial.com. To enroll, visit myfcsfinancial.com and click on this link.

•

To sign up for online account access visit myfcsfinancial.com and click on the “Enroll in secure online banking with FCS Financial” found at the top right side. “I wo

uld l ik links e too...” m navi gatio ake n ea sier.

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HEARTBEAT | SUMMER 2012

member feature

Farming With a Glas No water marks. No sand bars. Corn emerges from these fertile bottoms of the Missouri River this year, just like last. Yet, two consecutive years of flooding in the northwest corner of the state brings with it two years of crop loss and yield data. Farmers here, normally, have 25-30 percent of their crop already sold. But, this year it’s not. Still, their glass remains half full. Faith in farming tells them it will be okay. Technology helps them plan for the future. “We’re farmers,” Rick Gillenwater explains profoundly. “We have to be optimistic or we 6

HEARTBEAT | SUMMER 2012

wouldn’t go out there and put that seed in the ground. I think things are going to turn out great this year.” Gillenwater and brother-inlaw Kevin Young together operate Young Farms, Inc., a corn and soybean operation nestled in the Missouri River bottoms just southwest of Mound City off Interstate 29. Founded in 1952 by Kevin’s parents, William Leroy (now deceased) and Jeanie Young, the enterprise gleans hope year after year that the mighty Missouri will pardon her banks. While floods in 2010 and 2011 left them with no crop to harvest,

the duo remains steadfast in determination to climb back on the tractor and give it a go yet again.

Farming the Bottoms “We are fortunate enough to farm what she and grandpa spent a lifetime building,” Gillenwater says turning to his mother-in-law. Married in March 1956, Bill and Jeanie saw their own fair share of flooding through the years —1952, 1974, 1984 and 1993. “Hanging in there” is what Jeanie Young says is the secret to farming the sacred Missouri River bottoms. “We have had plenty of experience with flooding,”

ss ‘Half Full.’ Gillenwater says with a nonchalant grin. “We’re seasoned. We’d just as soon have a few years off.” Gillenwater and Young are optimistic, though, that this year’s growing season will bring different results. And every day that goes by, the odds are more and more in their favor. According to Kevin Young, “There are still a lot of broken levees. It would take a tremendous rain to get us backed up again.” Farming the bottoms doesn’t bring the rolling current of the Missouri River to Young Farms, but rather idle backwater.

Article and photos by: Joann Pipkin

The goal with precision modified seed meters on planters is to improve seed placement, spacing and planting depth so that all the seed is evenly spaced and out of the ground at the same time, according to Rick Gillenwater and Kevin Young.

HEARTBEAT | SUMMER 2012

Rick Gillenwater (right) of Young Farms works with FCS Financial’s Chad McCollough (left) for assistance with equipment, operating and real estate loans. Young Farms has been an FCS customer since 1952. Sandbags are a reminder of the 2011 flood, which forced Kevin & mom Jeanie Young, and Rick Gillenwater out of their homes. Young Farms, Inc., is aggressive with their purchase of crop insurance. In addition to the insurance, they credit their crop base and excellent foundation as means for their steadfastness. 8

HEARTBEAT | SUMMER 2012

A levee behind both Jeanie Young’s home, and the home where Kevin lives with his wife Regina, saves much of their bottomland farm from the river’s current, while the backwater leaves nothing but wetness. “We’re fortunate to have had the flood insurance we had,” Gillenwater notes. “But, if you take the crop that we could have had versus what we got and sell it at $5.00, you’re talking a 25 percent across the board reduction in gross income. And, that’s a tough pill to swallow. Our expenses were the same.” Gillenwater, who came to Young Farms in 1978 after marrying Kevin’s sister, Regina, realizes that despite how tough the floods have been on their operation, “if you just look around, you can find someone else in way worse shape than you.” He credits having a good yield base, good crop insurance and an excellent foundation as being key to the operation’s survival. “There have been some pretty heavy-hearted times but I never doubted that we would make it through,” he says. Last summer’s flood was especially trying. There was not only lost crop, but also moving and shuffling of homes. Through it all, Gillenwater and Young were at the farm every day. “We knew in February or March the water was coming,” Young notes. “We just didn’t know when. We were flooded in July.” Gillenwater recalls his basement being flooded on July 4 during the 1993 flood. “I wondered then if I’d ever have to do that again (on the

Fourth of July),” he recalls of having a sump pump rid the basement of water. “By mid-July last summer, everything was gone.” A risk management tool, crop insurance is surely a critical element for Young Farms. “We wouldn’t dream of farming the bottoms without insurance,” Young chimes in. Although Young Farms is already set for insurance on this year’s crop, it wasn’t without paying a pretty penny. With a number of levees still broken, insurance premiums have risen this year for farmers like Gillenwater and Young. According to Gillenwater, the 2011 flood was just as devastating as the one in 1993, while 2010’s wasn’t as bad. “We didn’t feel as threatened on the farm in 2010,” he notes adding, “but we still lost all of our crop.”

Through Unit Pros, Gillenwater and Young modify the existing seed meter on a planter and retrofit it with one that is precision modified. “The goal is to improve seed placement, spacing, planting depth,” Gillenwater explains. “You want all of the seed evenly spaced and out of the ground at the same time.” The nine-year-old business has experienced tremendous growth

Gillenwater explains that with the precision-modified planters, some farmers have saved as much as 10 percent on seed costs. “The goal is not only to have the plant population that you desire, but you also want every one of those stalks to have a uniform ear,” Gillenwater says. “If those stalks are too close together or too far apart then that doesn’t happen.”

Tapping into Technology “If you’re going to be successful, you have to be your own worst critic,” Gillenwater explains. “You do something and you go back and look to see what you could have done better.” And, it’s that philosophy that led Young Farms to precision farming. “The precision is a result of us scouting the fields and realizing the seed wasn’t where it was supposed to be,” Gillenwater says. Young explains their purchase of a Precision stand was to help make their own operation better. The purchase, though, has led to an off-season, sideline business called Unit Pros that serves friends and neighboring farmers.

Technological advancements in farming have brought the iPad to Young Farms. Here, Kevin Young (center) demonstrates to FCS Financial’s Chad McCollough (l) and Corey Neill (r) how soil mapping works.

in its tenure. The two estimate installing between 400 and 600 meters per year. This year, they’ve had 18 planters in the shop, six of which were brand new. “Technology is the future of farming,” Gillenwater says. “You don’t have to farm with the latest technology, but you have to compete with the guys who do. Somehow you have to be able to stay competitive in the farm market.”

“If you end up with doubles, one of those plants won’t produce an ear,” Young adds. He continues explaining that on 17 ½ feet, with 30-inch rows, saving one ear of corn will gain you seven bushels per acre. “In our view,” Gillenwater says, “the most important piece of equipment a farmer has is his planter. You get one shot at putting the seed in the ground correctly.” HEARTBEAT | SUMMER 2012

Young Farms also uses an iPad as a precision farming tool. “I used to plant 5 miles an hour,” Kevin explains, “until this year. The iPad has showed me to slow down. I planted at 4 ½ miles per hour—all my acres at 4 ½ to 5 miles an hour.” Rick further notes, “The iPad gives you a high resolution planting map in real time as you are doing the job. So, if Kevin is planting and the ride on his planter gets uneven, he will know it. If the singulation or spacing starts to become erratic, he’ll know it—in real time—not three rounds later.”

Kevin says most of their customers are good friends, so they talk often and compare notes. Rick chimes in, “We’ll meet in town and everybody will bring his iPad; that’s no kidding.” Aside from precision modified planters and iPads, Young Farms seized another piece of technology a couple of years ago to speed soil drying time. A Water Hog pump helps rid the land of surface water. “It will pump 30,000 gallons per minute,” Kevin says. “If we had a 4-inch rain, you could pump the water off with the Water Hog in a few hours.” The duo is also considering the purchase of a sprayer equipped with boom sensors that with the help of an optical eye would indicate how much nitrogen should be applied. And rather than grow their operation by purchasing more land, Young Farms instead is hopeful it can improve yield on existing acres. “We’re trying to take what we have and make it produce the most,” Kevin notes. “The pencil will tell you whether or not it’s time to buy,” Rick adds. “The way ground is selling for and what you can make off of it, to us it’s not time to buy.”

Passing the Buck Kevin Young (above) works on a planter as part of Young Farms’ Unit Pros business, which modifies existing seed meters and retrofits them with those that are precision modified. Rick Gillenwater estimates their precision modified planters are saving farmers 10% in seed costs. Gillenwater says the planter is the most important piece of equipment a farmer owns and he only gets one shot at putting the seed in the ground right. 10

HEARTBEAT | SUMMER 2012

When it comes to financial assistance, Young and Gillenwater say there was no other place to consider but FCS Financial. “We’ve been with FCS since 1952, right from the very beginning,” Young notes. And over the years, Gillenwater says they couldn’t have done business with a better place.

“We’ve been through some floods with FCS and they’ve stuck with us. They’ve treated us really well,” Young adds. “I need to know one thing about crop insurance. It’s 1-800-Corey Neill,” Gillenwater says referring to FCS Financial’s Corey Neill, who helps Young Farms fulfill its crop insurance needs. “We can’t be a specialist in everything,” he adds. “It’s everything Kevin and I can do to try and stay up on the latest technology in farming and try to do the best we can out on the farm with what we have. There are so many hats to wear. We don’t make financial decisions without calling Chad (McCollough).” In addition to Neill, Young Farms also works with FCS Financial’s Chad McCollough for personal and business including equipment, real estate and operating loans. “Looking to the future, Rick and Kevin don’t just consider this year,” McCollough says. “They’re looking down the road at what improvements they can make in their operation. And, they don’t throw all their eggs in one basket.” Neill adds, “They understand the risks they are up against here in the bottoms. They understand what crop insurance can do for them and how it manages that risk.” All in all, McCollough credits Young Farms with keeping on top of its bottom line. “They don’t just do something because that’s the way it has always been done.” Gillenwater re-emphasizes, “You can’t be an expert on everything. You have to have people you work with that you have faith in and that you can trust.”

NEW OFFICE OPENS IN COLUMBIA Progress continues on FCS Financial’s future retail facilities. The new office in Columbia opened on May 21 and held an open house on June 20 from 10 a.m. to 2 p.m. The office is located at 2800 Woodard Drive, north of Menards.

springfield — A site located near USDA and Springfield Livestock Marketing Center has been purchased for a the new FCS Financial office that will consolidate the current Springfield and Bolivar offices. Bids from subcontractors are currently being accepted. joplin — Site research continues in the Joplin area with due diligence underway on three potential locations. Watch for future announcements in HeartBeat and on our website at www.myfcsfinancial.com.

Your Columbia FCS Financial Team (from left) Philip Durbin, Financial Services Trainee; Allison McConkey, Financial Services Specialist; Jason Wagner, Appraiser; Alan Gares, VP Customer Services Team; Donna Thompson, Financial Services Specialist; Sam Scheulen, Asst. VP; Kelly Lawson, Financial Services Specialist; Dan Rhoades, VP Risk Management; Shanda Nichols, Senior Credit Analyst; Dwight Austin, Vice President; Kathy Musbach, Financial Services Specialist; and Joe Abbott, Asst. VP Ag & Business.™ Not pictured: Brett Bryant, Credit Analyst.

HEARTBEAT | SUMMER 2012

youth in ag 12

Meet the FCS Financial Scholarship Recipients Through its scholarship program, FCS Financial has given nearly $290,000 to FCS Financial customersâ&#x20AC;&#x2122; children and grandchildren in the past nine years. We are proud to recognize and congratulate this yearâ&#x20AC;&#x2122;s recipients. We hope they continue to find success in their education and future careers. The application is available at www.myfcsfinancial.com and due March 1, 2013.

HEARTBEAT | SUMMER 2012

Savannah Angell of Centralia plans on attending the University of Missouri to major in animal science.

Colby Beisly of Nevada plans on attending the University of Missouri to major in agribusiness management.

Jaelyn Bergmann of Perry plans on attending the University of Missouri to major in animal science pre-vet.

Rachel Bruns of Warrenton plans on attending the University of Missouri to major in agribusiness.

Erin Christopher of Cameron plans on attending North Central Missouri College to major in arts science.

Asia Deckard of Nixa plans on attending Missouri State University in Springfield to major in biology.

Mallory Early of Leeton plans on attending Missouri State University in Springfield to major in agriculture marketing and photography.

Rachel Echternacht of Leonard plans on attending Truman State University to major in business accounting/finance..

Rebecca Felten of Pilot Grove plans on attending the University of Missouri to major in nutrition and fitness.

Jessie Fowler of Vandalia plans on attending the University of Missouri to major in agribusiness management.

Morgan Gehrke of Jefferson City plans on attending William Woods University to major in equestrian science and elementary education.

Ashley Gerlemann of Hermann plans on attending East Central College to major in agricultural business management and computer technology.

Samantha Gibson of Norborne plans on attending the University of Missouri to major in agricultural journalism.

Josh Gifford of Brighton plans on attending Ozarks Technical Community College to major in general agriculture.

Kayla Groebe of Osborn plans on attending the University of Missouri to major in agriculture education.

Tawnya Hardy of Browning plans on attending North Central Missouri College to major in agricultural business - precision agriculture.

Caleb Heid of Harrisonville plans on attending the University of Missouri to major in biochemistry.

Levi Henry of Asbury plans on attending Crowder College to major in animal science.

Corey Hudson of Middletown plans on attending the University of Missouri to major in animal science.

Ryan Korff of Sarcoxie plans on attending Crowder College to major in animal science.

Taylor Mahlandt of Helena plans on attending the University of Missouri to major in education.

Dylan Massa of Lamar plans on attending Crowder College to major in animal science.

HEARTBEAT | SUMMER 2012

Ryan Messner of Stanberry plans on attending Northwest Missouri State University to major in agricultural business - finance.

Rachel Nelson of Vandalia plans on attending the University of Missouri to major in biochemistry.

Benjamin Niendick of Wellington plans on attending the University of Missouri to major in ag business management.

Elizabeth Prenger of St. Thomas plans on attending the University of Missouri to major in biological science, natural resources or agriculture.

Kinsey Rasor of Peace Valley plans on attending Missouri State University in West Plains to major in agricultural business.

Jared Renkoski of Everton plans on attending the Missouri University of Science & Technology to major in engineering.

Lee Rucker of Tina plans on attending Lindenwood University to major in business finance.

Cody Schwent of Ste. Genevieve plans on attending Rockhurst University to major in engineering.

Paul Stark of Cleveland plans on attending Missouri State University in Springfield to major in animal sciences; pre-veterinary medicine.

Landon Steele of LaRussell plans on attending College of the Ozarks to major in criminal justice.

Logan Wheatley of Rich Hill plans on attending Missouri State University in Springfield to major in agriculture/ag business.

Grant Wheeler of Hardin plans on attending Northwest Missouri State University to major in agribusiness.

We are pleased to offer Jerry Crownover’s “Life is Simple” column. Jerry is a graduate of the University of Missouri. He and his wife, Judy, own and operate a ranch west of Springfield and are FCS Financial members. We hope you enjoy Jerry’s Ozark humor and wisdom. “Life is Simple” Copyright 2012, Jerry Crownover

It’s tornado season again in the Midwest. Actually, it’s tornado season year-round in my part of the world, but right now the storms are much more numerous, frequent and intense. Tornados activate different senses for different people. For some, fear is the primary feeling. Others experience tension, angst, elevated heart rate and blood pressure, increased sense of hearing, optical illusions as they gaze into the western sky, or all of the above. For me, the tornado warning brings on the smells of kerosene, oil cloth, and canned peaches. Nobody, living or dead, was more afraid of tornados than my late mother. Before we first moved to the farm where I grew up, my mother demanded a storm cellar be built in the side of a hill close to where the house would eventually

packed from floor to ceiling with the canned produce of last year’s garden harvest, along with canned meats and fruits. Since peaches were my favorite, I could usually talk Mom into opening a quart of those yellow-fruited delights—if we stayed past my usual bed time. I would, more often than not, eat enough to make me sick. So while my mother paced in fear from the impending tornado (none ever struck our place in the twenty years we lived there), I would relax on the cot, reading a school book by the kerosene lamp, nibbling on sweet peaches from a mason jar while Dad would keep going outside and coming back in with the weather report, “I think it’s OK to go back to the house.” Mom always wanted to wait another halfhour or so to make sure it was safe. It was quite the life. After our sons graduated and moved on, my wife relocated our bedroom into the basement that had served as our den during the kids’ childhood. Judy’s not afraid of storms, but surmised that the basement just made more sense. At night, I usually pay little attention to tornado warnings or severe weather alerts, knowing we’re about as safe and secure as we’re going to get. It, too, has eight-inch, steelreinforced concrete walls. I must confess that we have a nice bed down there instead of an old army cot that gives off petroleum fumes. But, if you look close enough, you’ll find a kerosene lamp on a shelf and a can of peaches beside it—just in case.

life is simple

be erected, before she would even agree to the move. As I remember, it was about eight feet wide and twelve feet long, with eight-inch steel-reinforced concrete walls, floor, and ceiling, with about three feet of dirt on top of the roof that blended right into the side of that hill. I should know all the dimensions, because I spent many nights sleeping in that cellar during tornado season. Keep in mind that my childhood was long before liveaction radar and community-wide siren systems activated by tornado alerts from the National Weather Service. If it was springtime and there were dark clouds in the west, the Crownover family was headed to the storm cellar. My father wasn’t scared of storms in the least, but Mom insisted that he join us in the cellar, lest he would be the only family member killed by what she was certain was, “a twister just over that western hill.” So, to keep peace in the family, Dad always joined us as well. Inside the cellar was an old army cot with an oil cloth canvas that we all sat upon until sleep overtook us. That aromatic smell permeated the cool, damp climate of the cellar and I can still smell it today when the western horizon turns black. There was no electricity in our little bunker, but Mom always made sure the kerosene lamp was full and that there was always a box of wooden matches next to it. It was a special treat to read by that old ‘coal oil’ lamp just as we had in my younger days. The cellar was lined with shelves,

HEARTBEAT | SUMMER 2012

dollars & cents

Mistakes of the Senior Generation. By: Dr. David M. Kohl

Dr. David Kohl energizes agricultural lenders,

producers

and

business

persons with his keen insight into the agricultural industry through extensive

travel,

research,

exposure during his career.

and He is

Professor Emeritus of Agricultural Finance

and

Small

Business

Management and Entrepreneurship at Virginia Tech, Blacksburg, VA. Dr. Kohl has traveled over 8 million miles in his professional career and conducted over 6,000 workshops and seminars for a variety of agricultural audiences.

Dr. Kohl’s personal

involvement with agriculture and interaction with key industry players provide a unique perspective into the future trends of the agricultural industry and economy.

HEARTBEAT | SUMMER 2012

In my North American and global travels, management and ownership transition is one of the top three challenges facing businesses. This is particularly an issue in agriculture because of the mix of business, family and the legacy of multigenerational farm businesses. Articles often center on the mistakes of the junior generation. Now let’s make a 180° turn and examine mistakes that are made by the more experienced producers at the other end of the spectrum in the agricultural arena. First out of the box is called “read my mind” by famous transition management speaker, Dr. Don Jonovic. The older generation has been conditioned over the years to keep their thoughts and perspectives close to the vest. Lack of transparency usually causes suspicion and a wide range of assumptions with those involved in the process. The key is to develop a written transition plan, most often with the assistance of an outside facilitator to keep the process on track and ask the tough questions. With multiple generations in larger, more complex businesses, the hiring of a facilitator is not an option but a requirement to ensure progress is made. The next mistake is failing to take time to develop a family budget in semi-retirement and retirement. Questions pertaining to where one will live, activities in the business and job responsibilities and descriptions versus enjoying the fruits of life are crucial decisions seniors need to make. Where one would like to live, whether it is in the middle of the farmstead, at a lake house nearby, or a condo in Arizona or Florida are questions to be answered. While the news media has a focus on college and university debt for the younger generation’s budget, the costs of medical care and insurance are equally challenging for the senior generation. I recommend that this generation develop a family living budget, and then realize that your budget is likely to increase by 4 percent per year due to inflation. Next, identify sources of income in retirement years, whether it is sale or lease of the farm, Social Security, or other investments off the farm. A general rule of thumb is that if the junior generation is entering your business, you need 50 percent of your retirement income from investments outside of the farm business, i.e. stocks, bonds, cash, etc. This is to allow for diversification so the younger generation is not responsible for your sole

“...transition management is full of potholes...”

source of retirement income. Another rule of thumb is for every $1,000 of retirement income needed per month, you will need approximately $200,000 of retirement equity. In other words, $5,000 per month equates to $1 million in equity. Finally, you should not treat all your children equally in the retirement schematic. On the contrary, divide up the estate fairly and equitably. The son or daughter who stays on the farm should retain the management or sweat equity because of the risk endured in carrying on the business. Children away from the business should receive outside investments from the farm or cash, which is liquid with no risk. It is suggested that any inheritance be systematically distributed. One transition planner suggests inheritance distribution be equal to W-2 wages or net business income annually so as not to spoil the younger generation. Remember, a person inheriting $100,000 will spend it in 17 months on average with little or nothing to show for it. A great book to read regarding inheritance is The Ultimate Gift by Jim Stovall. This book teaches many life values and principles through agricultural examples. Yes, transition management is full of potholes and can get one diverted and into the ditch very quickly. However, proactively planning ones transition from the senior side with experience and wisdom can provide needed leadership for the next generation of management. A well-planned transition road map by the senior generation helps the younger generation prepare to get the business to their destination.

The 30-day vs. 15-Year Farm Credit Bond chart below illustrates that 30 day issues continue to stay at historically low levels through March 31, 2012. These same rates remain flat as approach mid-year. However, movement in the gap between long-term and short-term rates widens. You may want to consider locking in historically low, fixed rates on real estate loans or other term loans in order to avoid escalating interest costs should interest rates continue to move upward. You may also want to talk with your FCS Financial expert about loan conversion options on those loans that do not include prepayment penalties. This benefit is available to existing loan customers and is generally less costly and simpler than refinancing your loan.

30-Day vs. 15-Year Farm Credit Bond 8.00

30-Day Farm Credit

15-Year Farm Credit

Fed Funds Target

7.00

6.00

All-in cost

5.00

4.00

3.00

2.00

1.00

0.00

Date

HEARTBEAT | SUMMER 2012

risk management Wheat Sales Closing is September 30 Insure your new wheat crop with an MPCI policy Please contact your agent for any of the following actions regarding wheat sales: • • • • • •

New Application Coverage level/price election changes to existing policy Add a County Transfer/Cancellation Entity/Marital Status changes Request for Actuarial Change

To ensure accurate premium quoting, please report 2012 wheat production as soon as possible.

Important Dates to Remember July 1 Premiums/fees due for fall planted crops July 16 Acreage reports due for all spring planted crops

Reports must be completed, signed and received by your agent by this date.

August 15 (New for 2012) Premiums on spring crops will be billed. September 30 Sales Closing date for fall wheat Sales Closing for PRF October 1 (New for 2012) Premiums due on spring crops October 31 Final plant date for wheat (15-day late plant through Nov. 15) November 14 Final date to report 2012 wheat production. 18

HEARTBEAT | SUMMER 2012

MPCI Crop Insurance Policy Holders:

Don’t forget to contact your agent! • • • •

• • •

If you discover damage has occurred to your crop, you must notify your agent to turn in a claim within 72 hours (3 days). Chopping, baling or destroying a crop? Prior to destroying any insured crop, contact your agent so they can request a crop appraisal from the insurance provider. A replant claim cannot be paid until your MPCI acreage report has been completed and processed. If your finished planting, report to FSA immediately. Also, have FSA forward the producer print and aerial maps to your crop agent. Then work with your crop agent to complete. All acreage reports must be completed and signed before July 16. A signed report is required even if you have zero acres to report. Acreage reports require the reporting of all acreage in all counties, both insured and uninsured. If you have any questions or you’re in doubt about any part of your policy, contact your agent.

Report to FSA early; then to your crop agent.

Claims cannot be worked or adjusted by your insurance companies until MPCI acreage reports have been turned in and processed by your agent and insurance company. It is of the utmost importance that you report to your local FSA office as soon as possible if you have completed crop planting. Your crop insurance agent needs your 578’s and maps to check and support the processing of your MPCI acreage reports due July 16 for your crop insurance policy.

Hail and named peril coverage provided extra protection. In a matter of minutes your crops can be severely damaged by hail and/or wind. Hail is one of the most common weather conditions that can threaten your crops and your livelihood. It can wipe out part of a field, damage a few acres here and there or totally devastate an entire crop. Was green snap or wind coverage included in your 2012 hail policy? Crop hail insurance is a great option to help supplement your Multi-Peril Crop Insurance (MPCI) policy and overall risk management plan. It’s not too late to purchase a policy. Contact FCS Financial today and let one of our agents help you with your coverage needs. With potential crop insurance income per acre at all time highs, a few extra dollars for hail insurance may be your cheapest crop cost per acre.

need coverage on your forages? Pasture, Rangeland, Forage (PRF) insurance must be purchased by September 30, 2012.

The ALOT mission is “to provide

encourages involvement and leadership

process. A prospective participant must

advanced leadership experiences that

initiative

be at least 25 years of age by February

will make a positive impact to the

communities, connects participants to

2013. There is no upper age limit.

future of agriculture and agribusiness

ALOT’s 375 alumni participants across

Applications will be accepted

in Missouri and beyond.” They do this

Missouri, and introduces them to

beginning

by providing a two year adult leadership

hundreds more of Missouri’s innovative

application deadline for ALOT Class

training program targeted toward rural

and involved citizens who offer their

XV is September 1, 2012. Interviews

leaders and agricultural producers who

personal experiences and insights to

will be held in the fall and the new

have a passion to promote Missouri

help participants become more effective

class will be announced by November

agriculture and strengthen their rural

leaders.

2012. Sessions will begin in February

communities.

ALOT began in 1983. Our alums

2013. The cost to the participant is

The ALOT program includes

serve on the boards of almost every

$4,000 due in January 2013 or $2100

ten in-state three day sessions, a

agricultural organization in Missouri,

due in January of 2013 and 2014.

week long seminar in Washington

fourteen have served in the Missouri

The program spends over $15,000 per

D.C., and a two week international

legislature, one is a U.S. Congressman,

participant.

experience to a country that impacts

and two have served as Missouri

For

Missouri agriculture. The program

Directors of Agriculture.

alotmissouri.com. You can also email

enhances participants’ communication

They are currently recruiting for

Kristin Perry, ALOT Executive Director

and leadership skills, expands their

ALOT Class XV. The 25 participants

at alot@onemain.com or call her at

understanding of agricultural issues,

will be selected though a competitive

573-324-6538.

their

industry

and

YOU can be THE Face

of FARMING

July

information

2012.

visit

The

news briefs

Looking for Applicants for ALOT Class XV

www.

& RANCHING

U.S. Farmers and Ranchers Alliance (USFRA) is looking for the “Faces of Farming and Ranching” to help put a real face on agriculture at the national level through special events, media coverage, advertising and other marketing and promotional activities. If you are a standout farmer or rancher who is … proud of what you do

eager to share your stories of continuous improvement with others

actively involved in telling those stories

… then enter by Sept. 8, 2012 at www.fooddialogues.com. Winners will receive:

• a $10,000 stipend • a $5,000 charitable donation in their name • the opportunity to tell the real stories of today’s farmers and ranchers

Finalists will be announced at the November Food Dialogues in New York and the winners will be announced in January 2013. Official rules and additional details available at www.fooddialogues.com.

Wholly or partially funded by one or more Checkoff programs.

FCS Financial Director Dr. Mike Cook Inducted into the Cooperative Hall of Fame FCS Financial is proud to congratulation Dr. Mike Cook on his induction into the Cooperative Hall of Fame. Dr. Cook has served as an appointed member of the FCS Financial Board of Directors since 1989. He is truly deserving of this honor. Below is the article about Dr. Cook and his award reprinted with permission from CAFNR Communications (www.cafnrnews.com) and written by Mike Burden.

Dr. Mike Cook

Mike Cook has earned the title hero—a cooperative hero. On May 2, he was inducted into the Cooperative Hall of Fame at Washington D.C.’s National Press Club after a public forum on cooperatives connected to the United Nations declaration of 2012 as the International Year of the Cooperative. He has been a CEO, a mentor to CEOs of national and global cooperatives, counseled cooperative leaders in more than 40 countries, inspired students who have gone on to be leaders and award-winning professors and is still striving to solve the global hunger problem—a goal he’s pursued since serving as a Peace Corps volunteer in Uruguay in the mid-1960s. Cook, the Robert D. Partridge Endowed Professor in Cooperative Leadership and executive director of the Graduate Institute of Cooperative Leadership (GICL) in CAFNR’s Division of Applied Social Sciences, joins the likes of 20

HEARTBEAT | SUMMER 2012

Howard Cowden, who was the founder of the cooperative that became Farmland Industries. An endowment in Cowden’s honor started GICL, which Cook has overseen since 1993. “The roster of the Cooperative Hall of Fame tells the story of the U.S. cooperative community through the lives and accomplishments of extraordinary individuals. Induction to the Cooperative Hall of Fame is reserved for those who have made genuinely heroic contributions to the cooperative community,” said Gasper Kovach, Jr., Board Chair of the Cooperative Development Foundation (CDF) which administers the Hall of Fame. Cook is one of only six educators who have been inducted into the prestigious group since 1976. Dick Vilstrup, Cook’s mentor during his graduate studies at the University of Wisconsin, is one the others. Vilstrup introduced Cook to cooperatives. “I was inspired by his brilliant mind; every time I went to see him he had 10 new ideas and he was working on them all. He was fantastic,” Cook said of his former teacher. Cook has passed on that inspiration. Fabio Chaddad, assistant professor in Agriculture and Applied Economics in CAFNR,

was one of Cook’s graduate students, who, like Cook, won the Edwin G. Nourse for outstanding dissertation on cooperatives. “Mike exposed me to the economic importance and complexity of coops and the opportunities to do research with coops; he inspired me to study coops,” Chaddad said. “He advised me to find my own teaching persona to connect with students as well. It was good advice and it helped give me the freedom to experiment,” Chaddad said. “Few educators are recognized and this confirms and validates what a unique program GICL has been over the past four decades,” said Kristi Livingston, a project development specialist in agricultural economics who has worked with Cook for the last 18 years. She started working with Cook after taking his coops class. “Mike is gifted,” Livingston added. “He has a unique perspective because he served in industry; he was a CEO of an agricultural cooperative and he takes that hands-on knowledge of how cooperatives work and function in the real world and that really guides all of the research that he does. He’s able from the advances in economics of organization

theory to help cooperative leaders better understand the issues and challenges they face because he can use theory and research but in a way that’s really applied. He is uniquely gifted in the way he bridges those two worlds.” Collaborating for Cooperative Success at Home and Abroad More than 2,000 cooperative leaders have graduated from the GICL institute. The GICL board is composed of influential leaders, such as Tom Payne, Vice Chancellor and Dean of CAFNR at MU and CEOs, including Jerome Taylor, President and CEO of MFA Oil and a graduate of the GICL summer institute. Taylor commented that MFA has hired several of Cook’s former students. In his letter to the Cooperative Hall of Fame selection committee Taylor said the following: “Mike Cook has done more to refine, regenerate, empower and strengthen the cooperative form of business than any individual in this country, and perhaps globally, because his services are requested all over the world.” Cook recently returned from a trip to Kenya and Uganda, where he and David O’Brien, professor of rural sociology in CAFNR, are advising Land O’ Lakes International Development, a notfor-profit division of Land O’ Lakes, Inc., that works “to help our fellow farmers around the world and to improve the efficiency of markets and the viability of agribusinesses.” The project brought together dairy farmers from all over the world, including Nicaragua, India, the U.S. and Kenya and Uganda.

“Dr. Cook and Dr. O’Brien have been not only advisors to the project from a technical perspective but also boots on the ground, collecting data, helping us to understand how our project could be positioned in terms of leading frameworks and thinking in the research community,” said Rebecca Savoie, project manager for the Cooperative Development Program, managed by Land O’ Lakes International Development and funded by US Agency for International Development (USAID). Back in the classroom, Cook and O’Brien also team up to teach a graduate class on collective action. “It’s one of the best classes I’ve taken,” said Phillip Mohebalian, a PhD student in forestry who also served in the Peace Corps in Paraguay. Mohebalian plans to apply the concepts he explored in class to work with communities to manage their forest resources. Mohebalian also noted that the concepts of collective action can move from the global scale, such as addressing climate change to small situations, too. He also hopes to solve the forestry graduate student coffee dilemma, where several students partake of the collective good—coffee—but don’t contribute to the supply often enough or at all. “This class changed the way I think about how people work together.” Mohebalian said. Cook will continue to innovate, inspire and lead cooperative education, research and practice. Of all his successes, he said he’s most proud of his students and the global network they’re creating through research, outreach and education.

“One of the reasons he has such a passion for coops is that deep inside he’s a Peace Corps Volunteer who wants to serve the world,” said Juanamaria Cordones-Cook, his wife and a professor of Spanish at MU. “That’s one of the things I admire in him—the desire to give to his fellow human beings, to make like better for other people.”

office hours at carthage Effective June 1, 2012, the FCS Financial office in Carthage will be open on Mondays from 12 noon to 4:30 p.m. and Thursdays from 8 a.m. to 12:30 p.m. or by appointment. To schedule an appointment call the Neosho office at 1-866-451-6084

HEARTBEAT | SUMMER 2012

Incumbents re-elected to board

mark deshon clarksdale, mo

dan devlin edina, mo

maurice glosemeyer marthasville, mo

james nivens larussell, mo

Through a mail ballot, the stockholders of FCS Financial re-elected four directors to serve three-year terms. Mark DeShon, 50, owns 800 acres and rents 800 acres. He and his three children Matthew, Michael, and Natalie, along with son-in-law Victor and grandson Ryan, raise dairy replacement heifers, beef cows, contract broilers, corn, soybeans, wheat, alfalfa and grass hay. Mark has served on the FCS Financial Board of Directors since 2006 and represents Andrew, Atchison, Daviess, DeKalb, Gentry, Harrison, Holt, Nodaway and Worth counties. Dan Devlin, 39, and his wife, Karisha own 1,620 acres. Their farming operation consists of corn, soybeans and wheat. He has served on the Board of Directors since 2009. Dan represents Adair, Clark, Knox, Lewis, Putnam, Schuyler and Scotland counties. Maurice Glosemeyer, 63, and his wife, Delores, own 592 acres where they grow corn and soybeans. Maurice has served on the Board since 2009 and currently is chairman of the Audit Committee. He represents Audrain, Boone, Callaway, Cooper, Howard, Montgomery, Saline and Warren counties. James Nivens, 60, and his wife, Carolyn, own 900 acres and rent 480 acres. Their farming operation consists of corn, soybeans, wheat, hay, cow/calf herd, backgrounding home-raised calves and a small farrow-to-finish hog operation. James has served on the FCS Financial Board of Directors since 1998 and currently serves as chairman. Barry, Barton, Dade, Jasper, Lawrence, McDonald, Newton and Stone counties are represented by James.

sherry jones appointed to fcs financial board

Effective April 25, the FCS Financial Board of Directors appointed Sherry Jones of Dawn, Mo., to a one-year term to fill a vacancy on the board. The vacancy was created in March when Brian Peterson was elected to the AgriBank Board of Directors. Sherry previously served on the Stockholder Advisory Committee for FCS Financial. Sherry and her husband, Charles, own 1,400 acres and rent an additional 1,500 acres. Their farming operation consists of a commercial cow-calf operation, along with raising wheat, corn, soybeans, alfalfa and hay. She currently serves as President, Livingston County Farm Bureau; Chair, Missouri Farm Bureau Sixth District PAC; and District Director, Missouri Transportation Alliance. She also serves on the board of the Missouri Agriculture and Small Business Development Authority, Calvary Baptist Church Finance sherry jones Committee and the Missouri State Fair Commission. She was employed 22 years with dawn, mo Bank Midwest and served 9 years on the Missouri Farm Bureau Board of Directors. She and Charles have two children, Tyler and Meredith. “We are pleased that Sherry Jones will join the FCS Financial Board,” said Daryl Oldvader, CEO. “Her expertise and experience in finance and farming will provide many benefits to the organization as the agricultural industry continues to advance.” 22

HEARTBEAT | SUMMER 2012

Missouri Farmers Team up with St. Louis Cardinals A St. Louis Cardinals video crew and team mascot Fredbird has been visiting area farms this summer as part of an educational campaign to highlight advancements farmers are making and help answer questions regarding today's food production. While at Kirby Farms near Liberal, Mo., on May 7, the crew interviewed Missouri Corn Merchandising Council board member Kyle Kirby about the latest trends in corn production. "Thirty years ago, my dad raised 80 bushels of corn per acre. Now we are producing 150 bushels," Kirby said. "With today's farming techniques, it's possible to have great yields while improving the soil and protecting the environment." The featured farmers also visited Busch Stadium in May to record radio ads and have photos taken with Cardinal pitcher Jason Motte for various campaign elements. This is the third year the World Series Champions are partnering with Missouri Farmers Care in a season-long effort that includes radio ads, videos of Cardinals mascot Fredbird on the farm, an AgriMissouriâ&#x201E;˘ gift basket giveaway at every Friday night home game, print advertising and promotional materials. Sponsors of this summer's Missouri Farmers Care Safe at the Plate During a video shoot at Kirby Farms, St. Louis Cardinals mascot Fredbird helps Kyle Kirby (center) feed the family's show steer while learning about corn educational initiative include the Missouri production in Missouri. Photo Credit: Missouri Corn Merchandising Council Corn Merchandising Council, Missouri Pork Fredbird helps FCS Financial member Kenny Graham with his pose during Association, Missouri Beef Industry Council, a recent photo shoot at Busch Stadium. Photo Credit: James Fashing, MFA Midwest Dairy Association, MFA Oil, FCS Incorporated Financial, Missouri Farm Bureau, Missouri Soybean Association, MFA Incorporated and the St. Louis AgriBusiness Club. To learn more about Missouri Farmers Care and view videos from previous campaigns, visit www.MoFarmersCare.com.

Shown with St. Louis Cardinals pitcher Jason Motte are the five Missouri farmers featured in the 2012 Safe at the Plate campaign. From left: Kenny Graham, cattle farmer, Farmington; Kyle Kirby, corn farmer, Liberal; Jim Fisher, hog farmer, Bowling Green; Lisa Cox, soybean farmer, Martinsburg; and David Hutsell, dairy farmer, Hartville. Photo Credit: James Fashing, MFA Incorporated

Youth Groups Receive Betterment Grants FCS Financial is recognizing 17 different 4-H clubs and FFA chapters with $250 grants for submitting outstanding Shaping Rural Missouri grant applications and plans to complete a community improvement project in the coming months. This is the first year FCS Financial has funded the Shaping Rural Missouri grants for 4-H clubs and FFA chapters. “Our offices are located and our staff lives in rural Missouri so it is important to us that we provide opportunities for rural community development,” said Daryl Oldvader, CEO, FCS Financial. “These grants not only strengthen our rural communities but allow our youth to work as a team to accomplish a goal.” The following 4-H clubs and FFA chapters were selected by a panel of judges to receive a $250 Shaping Rural Missouri grant in support of implementing the respective project listed: • Be Bo Bouncers 4-H Club (Audrain County): Update arena fence at 4-H fairgrounds. • Big Creek 4-H Club (Warren County): Improve safety by updating bleachers at Warren County Fairgrounds. • Circle A 4-H Club (Miller County): Landscape Iberia R-V school grounds. • Concordia FFA Chapter (Lafayette County): Construct new livestock stalls and storage system for stalls in the fairgrounds livestock barn • Cooper County 4-H (Cooper County): Landscape the front of the fairgrounds exhibition hall with Missouri wildflowers and plants • Dawn Sunrise Hustlers 4-H Club (Livingston County): Landscape the Mervin Jenkins Community Center in Dawn, Mo. • Drexel FFA Chapter (Cass County): Landscape the Gratton Memorial at the Drexel High School football field. • Freedom Reins 4-H Club (Laclede County): Update fencing around historical spring at North Park in Marshfield and provide signage telling story of the spring. • Gorin Go-Getters 4-H Club (Scotland County): Build picnic tables at local fairgrounds. • Helping Hands 4-H Club (Benton County): Assist local disabled residents with landscaping. • Indian Grove 4-H Club (Chariton County): Develop a community courtyard in downtown Brunswick. • Monroe County 4-H (Monroe County): Assist in building show barn at fairgrounds dedicated to Jacquie Stuart. • Mighty Mo 4-H Club (Lafayette County): Plant 14 oak trees at Dyer Park. • Olde Tyme 4-H Club (Ray County): Landscape courtyard area Top: FCS Financial’s Stephanie Tyler (right) awarded the Mighty MO of Lawson Manor & Rehabilitation in Lawson, Mo. 4-H Club with a $250 Shaping Rural Missouri grant. The Mighty MO 4-H Club plans to plant 14 oak trees at Dyer Park with the • Ridgeway R-V FFA Chapter (Harrison County): Assist in grant funds. Bottom: FCS Financial’s Curtis Fischer (fourth from building Ag & Community Building on Ridgeway R-V school left) presents the $250 grant to Circle A 4-H Club. They intend to grounds. landscape the Iberia R-V school grounds. • Salisbury FFA Chapter (Chariton County): Build new digital community billboard to increase awareness regarding local events. • Windsor FFA Chapter (Henry County): Build picnic tables for new shelter house at Windsor Farrington Park Campground. 24

HEARTBEAT | SUMMER 2012

Customers pick up the check during lunch! As part of Customer Appreciation Day, FCS Financial members were invited to pick up their patronage check on March 8 and celebrate the success of FCS Financial. The association closed the year with a 4.6 percent increase in loan volume. Shown here are customers enjoying barbecue at our Hannibal office (right) and at our Jefferson City office (below). Each year the Board of Directors reviews the financial results of the cooperative to determine if a patronage will be paid. In 2012, more than $5.1 million was returned to members based on the results of 2011. Since 2006, FCS Financial has returned $20.7 million to our members.

FCS Financial Endows MU Extension 4-H Animal Science Programs FCS Financial has pledged $25,000 to establish the FCS Financial – Missouri 4-H Animal Science Fund. The pledge supports the Missouri 4-H Foundation endowment initiative, The Next Sixty Years, which focuses on providing permanent support for University of Missouri Extension 4-H state programs. The new fund will support animal science programs, including dairy, livestock and horse judging. These programs are essential to the future of agriculture in the state of Missouri, and are the roots of 4-H. “Supporting our rural youth is the key to a successful Missouri,” said FCS Financial CEO Daryl Oldvader. “We are honored to be a part of The Next Sixty Years initiative and are committed to helping 4-H members continue their education process in the animal science field.” “The Missouri 4-H Foundation is thrilled that FCS Financial has generously committed to continuing its support of Missouri’s rural youth through this new fund,” said Executive Director Cheryl Reams. A longtime supporter of Missouri’s rural youth, FCS Financial supports Missouri 4-H at many levels. “The scope of FCS Financial’s support to Missouri 4-H members is phenomenal. FCS Financial provides everything from scholarships, grants and state funding to local funding and in kind gifts, not to mention the time the organization devotes through its employees to assist 4-H. We are extremely grateful for all FCS Financial does to enhance opportunities for our youths now and in the future,” said Reams. HEARTBEAT | SUMMER 2012

FFA Video Contest Tells the Story of Agriculture State winners of the second annual FFA video contest were announced at the annual FFA Missouri State Convention in Columbia, Mo. Pleasant Hope and Walnut Grove FFA chapters tied for first, followed by the South Nodaway chapter for second and Meadow Heights for third. Other district winners included the Boonville and Newtown-Harris FFA chapters. There were 19 entries in this year’s contest, which highlighted the importance of agriculture and how farmers create safe, wholesome food; work hard to care for their animals; and are good stewards of the environment. View the top videos on our Community Support page. “As a sponsor of this contest, it’s exciting to see the passion and excitement today’s youth have about agriculture,” said Daryl Oldvader, CEO. “FCS Financial is dedicated to promoting and encouraging the next generation of agriculturalists. This contest is a tremendous opportunity for our next generation of leaders to tell their story to their peers.” A total of $7,500 in prizes was awarded to the winning chapters: $1,500 for first place, $1,000 for second, $500 for third and $500 for each district winner. This year’s contest was sponsored by FCS Financial, Midwest Dairy Association, Missouri Beef Industry Council, Missouri Corn Merchandising Council, Missouri Farm Bureau, Missouri Pork Association, Missouri Soybean Association and MFA Incorporated. To see the winning videos visit www.myfcsfinancial.com/how-we-are-different/ community-support.

Reminder: Our offices will be closed All FCS Financial offices will be closed on the following days in 2012 in observance of the noted holiday. Independence Day - July 4 Labor Day - September 3 Columbus Day - October 8 (New for 2012)

Thanksgiving - November 22 and November 23 Christmas Eve - December 24 (offices close at noon) Christmas Day - Tuesday, December 25

Supporting Missouri’s communities As a cooperative, FCS Financial is dedicated to serving rural communities in Missouri. Throughout the year, we receive many requests to support various causes. While we can’t donate to every cause, we have recently donated paper goods to all 4-H clubs in our service area; plaques, dinner and paper goods to the FFA state convention activities; cash to local food banks; and are sponsors of several ag events. Our past is rooted in rural Missouri and our future is committed to seeing it grow. Holidays are a peak season for most donors so to help restock shelves FCS Financial made a donation to the five Feeding America food banks serving our association territory. Shown here is Aaron Smullin, Second Harvest Public Relations Coordinator, (left) and Clint Callow, FCS Financial Vice President. 26

HEARTBEAT | SUMMER 2012

nivens’ notes

Greetings from the Board Room: This issue of HeartBeat seems to fall at an awkward time. It’s labeled as the summer issue but we’re hardly far enough in to the year to consider it the summer season. In my part of the world hay making is in full swing, you see fall-born calves that are being weaned and bean planting is just really getting started. The weather itself has caused some disruption with typical seasonal planning. An early start, then cool again, and now fairly dry and, after the discussions at the board meeting this past week, it’s not just the southwest corner of the state. The FCS Financia l board election is also occurring and the results tabulated as this issue is being put together. Whatever the results of the election, the board will have at least one new member. Brian Peterson, FCS Financial board member since 2002, was elected to the AgriBank Farm Credit Bank board in early March. AgriBank is the funding source for our loans and one of the conditions for service on their board is that newly elected members will resign from the local association. This is a new policy just implemented in the past year. Brian replaces Meredith Kapp, who had represented Missouri the past eight years on the AgriBank board. Many of you will remember Meredith as a past FCS Financial board chairman and a member not only of this board but of its predecessors. He was one of the individuals involved with the creation of this organization. I

offer him a heartfelt thanks for his leadership, dedication and service to Farm Credit in Missouri. In retrospect, the time that Brian served on the board of FCS Financial seems terribly short. He w i l l c er t a i n ly be m issed in our boardroom. Brian was always prepared, had a very good understanding of the association financials and not afraid to ask questions. His positions were well thought out, he was capable of defending them, but he also had the ability to compromise. We understand and support his decision to be a part of the AgriBank. We feel confident that he will provide the same thoughtfulness and dedication in his new role and our association will continue to benefit from his service. Mark Pierce has been selected by the board to serve as vice chairman. To fill a vacancy, our board policy provides that we will appoint a member, from the same area of representation, to complete that portion of a year remaining until the next election. The task of finding a suitable candidate could be quite time consuming. The board’s task was greatly simplified when we first looked to the other candidate in the last election. Sherry Jones, Dawn, Mo., had been selected by the nominating committee just over a year ago to be candidate for the position that Brian Peterson held. Sherry’s vote tally was impressive but not quite enough to displace Brian.

James Nivens, Chairman of the Board

But because of the confidence of the nominating committee, her service in other Missouri ag organizations and her participation in an FCS Financial advisory committee, the board unanimously offered the position to Sherry and she has accepted. Her addition to our board does mark a change for the FCS Financial boardroom. She will be the first woman to serve as a board member in our association history. The association’s year is off to a fine start. A new board member, new offices, more in the planning stages and the year-to-date financial results are admirable. With the June boa rd meeting, perhaps other new members, selection of board leadership and committee assignments. Even with the changes, our goal remains to be the lender of choice to Missouri agriculture.

HEARTBEAT | SUMMER 2012

PRESORT STANDARD U.S. POSTAGE PAID JEFFERSON CITY, MO Permit No. 210

FCS Financial locks into your needs. FCS Financial understands the challenges that you face when purchasing or expanding farm real estate. We also know that those challenges are different for each type of operation. That is why our Focused. Customized. Solutions.™ approach to service is built to bring the right resources to you by matching you with a team of experts and financial options that fit your specific needs. Unlike many other lenders, FCS Financial offers the security of fixed rates up to 30 years. Whether you need to buy or refinance a farm, ranch or related facility, we can help you choose from a variety of loan options tailored to fit your needs today, tomorrow and into the future. We don’t think you should have to bend over backwards to get the financial support you deserve. That’s our job. We are Focused on your success in order to provide service, loans and financing Customized to your needs. And, in the end, to deliver Solutions that help you grow for years to come. Visit us at myfcsfinancial.com, call 1-800-444-3276 or stop by any FCS Financial office for Focused. Customized. Solutions.™

Focused. Customized. Solutions.™ For who you are. For what you do. Focused. Customized. Solutions. is a trademark of FCS Financial, ACA. FCS Financial is an Equal Opportunity Provider. Current life insurance carriers available at myfcsfinancial.com