HeartBeat fall 2014
Three countries later and
his dreams are coming true.
Board of Directors — FCS Financial ACA James Nivens, LaRussell, Chairman
Stacy Hambelton, Gainesville
Mark S. Pierce, DeKalb, Vice Chairman
Daniel Hulse, Hannibal
Kenneth Bergmann, Walnut Grove
Sherry Jones, Dawn
Michael L. Bruce, Nevada
David Meneely, Chillicothe, Appointed
Michael L. Cook, Columbia, Appointed
Troy Norton, Columbia, Appointed
Mark DeShon, Clarksdale
Rick Rehmeier, Augusta
Dan Devlin, Edina
Charles Steck, Jefferson City
Maurice Glosemeyer, Marthasville
Office Locations 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 Joplin 417-572-0011 1-866-451-6084 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 Nevada 417-667-8206 1-888-667-9681 O’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
Publication Information CEO: David Janish 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
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HEARTBEAT | FALL 2014
Printed with farmer-grown soybean ink on recycled paper.
Find out how Norbert Gabel’s life comes full circle with a few turkeys under his wing.
Table of Contents Dave’s View..............................................4 Member Feature....................................6 Life is Simple........................................ 11 Dollars & Cents.................................... 12 Risk Management.............................. 14 News Briefs........................................... 26 Niven’s Notes........................................ 23
HEARTBEAT | FALL 2014 3
DAVE’S VIEW
David Janish, CEO
I’ve just completed my first year at FCS Financial on August 1. There’s the old saying “time flies when you’re having fun.” Well, I must be having fun because this past year has flown by more quickly than I could have ever imagined. My wife and I have gotten settled in mid-Missouri and I must say it is feeling more and more like home. I’ve even learned the correct way to pronounce Nevada and Versailles. (It makes me wonder if those people living in the state and that place in France realize they’ve been saying it wrong all these years!) As I look back over this past year I realize how much I’ve learned about agriculture in the state of Missouri. I’ve had the opportunity to visit with producers both large and small, commodity groups, legislators, and agriculture business leaders. I’ve found all of them committed to
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HEARTBEAT | FALL 2014
agriculture and rural Missouri both now and in the future. However, as the recent vote on Amendment 1 shows, there is a considerable difference in opinion on how that can best be achieved. The influence of the urban areas continues to grow and the percentage of the population that truly understands production agriculture continues to shrink. The future of agriculture is dependent on all of us finding common ground which allows us to work together on key issues. FCS Financial continues to show our support to agriculture and rural Missouri. In the last edition of the HeartBeat I commented on several programs and initiatives FCS Financial has introduced. In this edition you’ll find the article “Missouri Ag Students Receive New Curriculum.” The article talks about the new Vocational Ag Curriculum available through the Department of Elementary and Secondary Education. The curriculum was developed through a grant from FCS Financial. Our VP, Marketing and Sales, Scott Gardner, served on the Steering Committee that led the development of the curriculum and one of our credit team members, David Webb, was instrumental in developing and providing input to some of the modules in the new curriculum. Much of the time Scott
and David committed to this project was outside of normal business hours. We are extremely proud of Scott and David and of our participation in this initiative. Another article provides information on the 2014 Farm Bill. I recently attended a conference in which the Deputy Secretary for the U.S. Department of Agriculture spoke. Her primary points were that the new bill is significantly different than the approaches in previous Farm Bills and that it will require producers to make hard choices. I believe both these statements to be true and encourage you to start early, if you haven’t already, to understand your options. Finally, FCS Financial recently began our strategic planning for the 2015 through 2019 timeframe. Given the dynamics in the agriculture economy and the volatility in the global environment, it is extremely difficult to generate even a medium term outlook with much confidence; I’m sure you are faced with the same challenges as you look at your business. In the long term, I continue to see opportunities and upside for agriculture; however, we may experience a rough patch in the near term. My dad often said that it’s times like these that separate the wheat from the chaff. Best regards,
new office opens in nevada on october 27 In March, FCS Financial began construction on a new office in Nevada located at 1925 N. Osage. The office will open on Monday, October 27. To facilitate the move, the current building will be closed on Friday, October 24. A Grand Opening is scheduled for Monday, December 8, from 10 a.m. to 2 p.m. Lunch will be served.
Office Information FCS Financial 1925 North Osage Blvd. Nevada, MO 64772 Find the office just north of Liter’s Automotive. Phone: 417-667-8206 Toll Free: 1-888-667-9681 Fax: 417-667-2904 Hours: Monday-Friday, 8 a.m. to 4:30 p.m.
HEARTBEAT | FALL 2014 5
MEMBER FEATURE
FOUND: LIFE’S CALLING By Joann Pipkin
As
the lazy two-lane winds through the hills and hollers of south Missouri, high atop a hill above the James River, a man finds a life he’s longed for.
Small farmsteads line the roadways. Cows graze in the lush late-summer pastures. An
occasional car wears a roof-top canoe.
It’s a far cry from the streets of Berlin that welcomed his birth and from the auto-making
mecca of Detroit that brought a young 10-year-old through the gates to the U.S.
The serenity of the Ozarks sets in as the path leads us to the end of the journey.
Here, we find a man’s calling. Country living and the turkeys under his wing bring Norbert
Gabel full circle. 6
HEARTBEAT | FALL 2014
from the streets of berlin German immigrants, Norbert Gabel’s parents only intended to live in Canada for a few years, make some money and return to their homeland. Norbert was six years old when they made the move. After a while, the going back option became a distant memory. Settling in Milwaukee, Wisconsin, Norbert spent his remaining childhood years and into adulthood ‘neath the shadows of the big city lights. He joined the military, serving his new country two years as a company clerk and a parachute packer. Later, Norbert’s parents moved to New Mexico and he followed them there for a time. Still, he longed to live in the country. After taking early retirement from the Army, Norbert remembers looking through magazines and marveling at how relatively inexpensive the land was in southwest Missouri. He settled in Springfield in 1981, landing a ‘good job’ at the Solo Cup plant. “I thought it was too costly to start a farm,” Norbert recalls. “I just really wanted a couple of acres and a house.” He owned 20 acres near Elkland for a while and lived in an apartment in Springfield before Norbert Gabel grows heavy tom turkeys on his Stone County farm. Part of Cargill’s Butterfield complex, Gabel was named Best Big Tom Tunnel Grower in 2013. The turkeys, raised primarily for their breast meat, are bound for delicatessens.
building a house on 40 acres near Walnut Grove where he raised exotic animals for a time. Through an online dating service, he met and later married wife, Susan, a California transplant who had completed service as a United Nations worker in Sudan. Then, his 28-year career at Solo would come to an end as the plant announced its closing. Norbert had been intrigued by the opportunities poultry companies offered their growers. He looked at places for sale. Trees and streams were a must. His realtor helped him find assistance through FCS Financial and the rest is history. Since 2005, he’s out lasted two tornadoes and, today, Gabel Farm, LLC, soars high on a hill, just south of Galena in northern Stone County. It’s home to some 18,000 tom turkeys Norbert grows for Cargill’s Butterfield complex. He was named Best Big Tom Tunnel Grower in 2013. And, he thrives on
simply taking care of his birds. Aside from spending his days off with the former owner before closing on the farm, Norbert had no prior farming experience — unless you count the time he owned exotics. “It’s been said that turkey farming is relatively simple,” Norbert says, “(Give them) food, water and make them comfortable. It’s making them comfortable that’s the challenge.”
high on the hill Originating from Gentry, Arkansas or California, Missouri, the birds are hatched overnight, sexed and vaccinated, then de-beaked and loaded into tubs bound for arrival at the Gabel farm. Housed in a 600 feet long by 50 feet wide tunnel brooder house, the birds are further divided among three other growout houses, 400 feet by 50 and 450 feet by 50, once they reach week eight.
Turkey poults are a day old upon arrival at Gabel’s farm. Norbert Gabel is charged with feeding, watering and keeping the birds comfortable for up to 21 weeks. The turkeys are kept in a brooder house the first eight weeks before being divided into three grow-out buildings. The goal is for them to gain one-half to three-quarters of a pound each day.
Norbert describes his operation as a “heavy tom farm,” meaning he raises primarily tom turkeys, likely bound for breast meat in a deli. The birds are grown at the Gabel farm for 19 to 21 weeks, averaging one-half to three-quarters of a pound of gain per day. “We’re keeping the birds longer now due to a shortage of birds,” he says. “I’m taking some losses because mortality goes up at this age,” he continues. “Feed conversion goes down. Weight goes up. I can’t make up in weight gain what I lose in mortality and feed conversion.” Still, the turkey grower says he can’t complain. Growers like him are still getting paid based off of 18,000 birds, even though they are currently maintaining less than that. Norbert is complimentary of the attention Cargill gives its growers. In fact, the company stood 8 8
HEARTBEAT HEARTBEAT| |FALL FALL2014 2014
by him through two tornadoes. Yes, two tornadoes. A rare January tornado hit the hilltop turkey farm in 2008, ripping off 90 feet of the brooder house roof. Ten-day-old birds were huddled to
“I’ve learned some lessons. Stay focused on the birds.” the back of the house. Remarkably, only 1200 were lost. Then a second, more devastating, tornado hit the Gabel operation in May 2011. It was the same tornado that ripped through Joplin, Missouri, at EF5 strength. Norbert remembers he and Susan headed for the garage. As
she rounded up the couple’s passel of dogs, he listened for anything creaking. The trees swayed. Then, it was over. The two stepped out of the garage and back inside the house. Looking out the window, Norbert realized he had been hit again. He immediately called Cargill. From a distance, he could tell at least one building was hit. He climbed in the truck to head up the hill and survey the rest of the damage. Diesel fuel flowed down the drive. Building two was down as well. The middle of building three took a direct hit. Half of building four was down. The other half was still standing — sort of. Much of its debris cluttered the driveway. The next day, with the help of 30 to 40 people, the clean up began. “We spent two days just trying to keep the birds fed and watered,” Norbert says. Luckily, a neighboring poultry farm had recently loaded out birds. The farm was damaged, but still had power and water. By the second and third day, many of Norbert’s turkeys were moved to the neighbor’s facilities. Six thousand birds remained in building four for an additional week before another farm had an opening for birds.
“All of Cargill’s management was here all six days with me,” Norbert credits. Amid the destruction, Norbert’s death loss from the second tornado was surprisingly minimal at less than 1600 birds. “Not rebuilding wasn’t an option,” he says, “not even after the second tornado. What else was I going to do?” So, how did Norbert Gabel survive two natural disasters and climb his way to the top as one of Cargill’s top growers? “I don’t know,” he says simply. “I’ve learned some lessons. Stay focused on the birds.” Norbert says a field representative once told him, ‘you always know what’s going on. That’s big.’ Paying attention to the details is perhaps what sets this grower apart from his peers. “Any time I’m running up and down the driveway, I’m listening to the feed lines,” he says. Norbert typically has about two weeks to get houses cleaned out before another flock of birds comes in. As soon as the turkey poults are moved from the brooder house to the grow-out buildings, the brooder is cleaned to prepare for a new flock. “(Cargill) wants the house to be cleaned out and inspected with at least one week of down-time before new birds come in.” In all, there are about 90 growers in Cargill’s Butterfield complex. Norbert competes with
After the 2011 tornado hit Norbert Gabel’s turkey farm, the facilities were upgraded to tunnel houses. With the help of a computer, Gabel shows FCS Financial’s Tera Dover how he monitors temperature and humidity inside the barns.
other tunnel growers, having installed all the new “bells and whistles,” as he calls them, after the 2011 tornado.
the clear choice In a sense, FCS Financial helped Norbert Gabel discover his life calling. With the help of his realtor, Gabel was able to secure a loan on his farm real estate. “FCS has always been easy to work with,” Gabel credits. FCS Financial’s Tera Dover appreciates Gabel’s attention to details and his openness to new ideas. “It’s very helpful to work with someone like Norbert,” Dover says. “He stays on top of his business and
pays attention to the details.” Dover is also complimentary of Gabel’s environmentally-friendly atmosphere. The innovator has planted cedar and pine trees along the hillside just below his turkey houses to serve as a windbreak. He also recycled tin and wood after the tornado struck. The materials are being used to construct a shed for housing machinery on the farm. Gabel has installed LED lights in the barns to improve efficiency, and he marvels at wanting to figure out a way to include solar panels in the houses. “We just don’t recycle in this country,” he states. HEARTBEAT | FALL 2014 9
Top: Norbert Gabel strives for an environmentally friendly atmosphere on his turkey farm. He planted cedar and pine trees for windbreaks and recycled tin and wood from the 2008 and 2011 tornadoes that he uses today in the construction of a machine shed on the farm. Bottom: FCS Financial’s Tera Dover and Gabel work together for success at his Stone County farm.
finding life’s calling Norbert, with the help of longtime friend Randy Williams, who commutes daily from north of Springfield, closely monitors the turkeys. In between checks, the duo putter around the farm. This day, they continue their work on the machine shed. “I let him play,” Norbert says of Randy. “He comes up with a lot of great ideas.” Although Susan would love a long-distance get-a-way every now and then, Norbert says their range for road trips is three days. That gives him peace of mind while Randy monitors the flock in their absence. At 64, Norbert doesn’t plan on retiring. He has his sights set on getting his farm paid for and being able to hire a helper. Today, he’s found contentment high on a hilltop in Stone County, far above the James River. Was turkey farming Norbert Gabel’s calling in life? “I sure wish I’d have known about this many years before being forced into it,” he says. “I always wanted to be out in the country.” 10
HEARTBEAT | FALL 2014
LIFE IS SIMPLE in the trailer. Ron (late seventies),
out. She wanted my arm and not
Marvin (early sixties) and I, all got
the little shiny thing that resembled
in our trucks and headed over to
my arm on the end of a stick.
Homer’s place.
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 2014, Jerry Crownover
After another half-hour of the
Sure enough, the big, white
four of us trying every strategy
cow was in the pipe and concrete
imaginable to bait, drive, or
loading area with the trailer already
force the girl down to the trailer
backed up to the chute. The old
entrance, someone came up with a
cow was snorting and pawing
brainstorm. Since the loading area
the ground as we approached her
sloped significantly downward to
and, even with two-inch steel pipe
the trailer, maybe a person on top
between us and her, I will have to
of the rear of the trailer would be
admit that I jumped every time she
at enough of the cow’s eye level to
charged at me.
entice her to charge at them and she
“Get in there and drive her
would run on into the trailer. We
toward the trailer,” Ron instructed.
all looked at each other and decided
“You go ahead,” I answered, “I
it made as much sense as the other
think she likes you better.” Even though there was a series
things that hadn’t worked. But who would climb on top of the trailer?
of three gates to close behind her,
I suggested that the ‘youngest’
How many old men does it take to
that would eventually put the old
man should make the climb,
load one cow?
gal right at the trailer opening, she
knowing that Marvin was a full
One of my neighbors walked
wasn’t having anything to do with
three months younger than me.
into the coffee shop the other
anyone getting behind her to close
Homer and Ron both agreed that
morning and asked, “What are you
the first one. Someone suggested
age was the fairest way to pick a
boys doing today?”
putting a rope on the first gate so
climber. Marvin gave me the evil
Homer never asks, or even hints
we could pull the gate shut as she
eye, but proceeded to scale the
at any need for help because, though
charged us. That idea was good
side of the trailer, anyway. Once,
in his early seventies, he is still one
in theory, but when she saw the
on top, he dangled his legs over
of the toughest cattleman I’ve ever
gate closing, she wheeled around
the open trailer gate and got the
known. So, for him to even imply
and butted it so hard that it broke
attention of the cow by hollering
that he could use another body or
Marvin’s new rope.
sweet words to her. According to
I had the bright idea that, since
plan, the cow charged at Marvin’s
she was charging at anything
feet as he swung them up to avoid
I and two more of the regulars
that resembled a human, I could
her head, and she stumbled into the
volunteered to assist after he assured
tie a plastic OB glove on the end
trailer as Homer slammed the door
us that she was already captured in
of a sorting stick and dangle it in
on the now-captured cow.
the loading pen and all we really
front of her until she followed it all
So, how many old men does it
needed to do was get behind her so
the way into the trailer. That was
take to load one cow? Four: three
he could close the gate when she ran
another good theory that didn’t pan
on the ground and one in the air.
two to load an old cow to take to market was strange.
HEARTBEAT | FALL 2014 11
DOLLARS & CENTS
Overcoming Destructive Behaviors
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.
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HEARTBEAT | FALL 2014
Economic decisions are not always logical. Some say that 80 percent of financial and economic decisions are based on emotion and behavior where common sense and logic are thrown out the window. Let’s examine some of the destructive psychological behaviors that exist in the agriculture industry and explore a game plan to overcome them. The recent great commodity super cycle allowed some of the more common destructive behaviors to creep into decision-making. One of the more common ones has been greed. A producer panelist last year at a lending school was a classic example. The producer indicated that he had followed a University marketing and risk management program, only to leave potentially a half million dollars of revenue on the table, and, to boot, his wife agreed with him. Yes, in recent years, easy money and greedy behavior have been rewarded. However, in the long run knowing one’s cost of production, and having a balanced risk management program is the recipe for financial sustainability. Sometimes having a simple advisory team to provide input can be a valuable tool to counter the greed. Another aspect of greed has been the pedal to the metal approach in business growth. Some call it the undisciplined pursuit of more. Remember, growth is the number one reason why businesses fail. Often producers will become very greedy and plow all their profits into growth to hit the proverbial home run without holding a little of the working capital or cash back as a business and financial shock absorber. This is particularly noticeable amongst younger producers who have only experienced good economic times and low interest rates. A little bit of financial scenario planning with lower prices, yields, or higher interest rates can keep the business compass on a reasonable pathway to success. Another worrisome behavior observed and documented has been a sense of complacency. Recently, producers were surveyed anonymously by clicker technology at a conference. When asked how measurements are used in their decision-making, nearly 30 percent were obsessive about measures and their use in planning and decision-making. It was startling that over half of the producers measure many aspects of the business, but do not use them to improve farm and decision-making performance. It was even more concerning that nearly 20 percent track just enough to get by for taxes and crop yields. This type of management attitude is so yesteryear! A pure production manager who only strives for the highest yields and manages to minimize taxes could find their strategy to be very dangerous, particularly in the economic white waters that appear to be emerging on the horizon.
Utilizing farm records for production, management, and finance, linking to decision-making will be critical as individuals monitor business performance. Recently a producer had a great quote: What’s the cost of not doing something? In today’s world, taking a lackadaisical attitude toward records and financial information can quickly bury you given the high cost of investment in inputs. Complacency kills in the business world. Another destructive behavior being discussed is high family living withdrawals and nonfarm capital expenditures, sometimes called killer toys. While everyone must enjoy the fruits of success, exuberance and excessive consumption have been a large cash flow drain on many businesses. These withdrawals are analogous to concrete. Once concrete sets up, it is very difficult to change. Realistic expectations concerning living withdrawals and enjoying the fruits of your labor will be a behavior that is important for success. Developing personal living budgets and keeping nonfarm capital expenditures ranging from lake homes to exotic vacations contained within one’s means will be critical. Finally, the reality of three handle corn and possibly single digit beans is on the horizon. It is natural for many to ignore and avoid examining their financial bottom line with hopes for better times. A key to circumvent this avoidance behavior is to have regularly scheduled meetings with your lender to map out options and scenarios. Open lines of communication with suppliers, spouses, and business partners can often offer proactive perspectives before boxing yourself in a corner with no alternatives. Human behavior results in economic market cycles and is a reality of life in this world of instant communication where the cycles will be more abrupt. Surrounding yourself with the right people and a plan that includes a process of execution and implementation can keep your business on the pathway to success. THis chart illustrates that 30-day Farm Credit issues remain at historically low levels through August 2014 while the gap between long-term and short-term rates continues to decrease. Ask your FCS Financial expert about conversion options and the advantages of locking in low, fixed rates on real estate loan or other term loans. 30-Day vs 15-Year Farm Credit Bond 8.00 15-Year Farm Credit 30-Day Farm Credit
7.00
Fed Funds Target
6.00
All-in cost
5.00
4.00
3.00
2.00
1.00
0.00
Date
HEARTBEAT | FALL 2014 13
RISK MANAGEMENT
Things to know when you are
FILING YOUR CROP INSURANCE CLAIMS
1. REPORT IN A TIMELY MANNER If you think you may have a loss, contact your agent immediately. Policy provisions require you to report a claim no later than 72 hours after discovery of damage but no later than 15 days after harvest of the unit.
2. PREPARE FOR A CLAIM OR AUDIT REVIEW WITH ACCURATE RECORD KEEPING. Keep scale tickets and settlement sheets organized by unit
3. AFLATOXIN AND OTHER QUALITY ADJUSTMENTS Contact your agent at the first sign of grain quality issues.
4. CHOPPING, BALING AND ABANDONING CROPS You must be approved by an insurance company adjuster before doing any of these activities.
5. REVENUE CLAIMS There is a potential for revenue claims this year. Keep production records accurate and separate by Unit to prepare for a potential claim.
6. COMMINGLING PRODUCTION Commingling grain from several units requires a bin marking or load log to document production per unit. If you plan on commingling grain from past years, contact your agent before harvest begins.
DATES TO REMEMBER September 30
Sales closing date for fall wheat. Last day to make any changes to an existing MPCI policy for your 2015 crop policy.
October 1
Interest applied to unpaid spring crop premiums.
October 31/November 15
Final plant date for wheat. (See county actuarial for details or contact your agent.)
November 14
Final date to report 2014 wheat production.
November 15
Sales closing date for Pasture, Rangeland, Forage (PRF) Rainfall Index policies and acreage reporting.
December 10
Insurance coverage ends on spring crops.
December 15
Final acreage reporting date for wheat and barley. Final date to report spring crop claim. 14
HEARTBEAT | FALL 2014
2014 FARM BILL UPDATE NEW COMMODITY PROGRAMS The 2014 Farm Bill has several new programs for producers and eliminates Direct Payments, Counter Cyclical Payments, SURE (Supplemental Revenue Assistance) and ACRE (Average Crop Revenue Election). It also strengthens crop insurance by providing more risk management options for farmers and ranchers. The new Title I programs offered by the Farm Service Agency include Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC). Producers will have to make a one-time, irrevocable decision to select one of the two programs. Area Revenue Protection (ARC) can be elected individually to all crops on a given farm number or at a county level to all farms for a given crop. For farms where the Price Loss Coverage (PLC) option is elected at the Farm Service Agency, the Supplemental Coverage Option (SCO) can be added to your crop insurance policy. SCO provides area-based coverage up to 86 percent of your underlying crop insurance deductible. Indemnities will be payable once a 14 percent loss has occurred in the county and individual payments will depend upon coverage levels selected by producers. This endorsement will be available in select counties for corn, soybeans, wheat, grain
sorghum, rice and cotton starting with the 2015 crop year and is only available on RP, YP and RPHPE crop insurance plans. Visit the following websites to learn more on the details of the 2014 farm bill and to gain familiarity by using the decision tools and calculators. • http://www.farmdoc.illinois. edu/farmbilltoolbox/index.asp • https://afpc.tamu.edu/models/ decisionaid.php • http://w w w.rma.usda.gov/ news/currentissues/farmbill/
BEGINNING FARMER AND RANCHER (BFR) New for the 2015 crop year is the Beginning Farmer and Rancher (BFR) program. Qualifications for BFR include having not actively managed a farm or ranch for more than 5 years or have an insurable interest in a crop or livestock as an owner-operator, landlord, tenant or sharecropper. An insured may exclude years of having an interest in a farm or ranch if they were under the age of 18, in postsecondary studies or on active military duty. An insured will receive an administrative fee waiver, an additional 10 percent premium subsidy and a yield adjustment increase from 65 percent to 80 percent of the county T-yield if qualified. Contact your crop insurance agent for more details if you think you might qualify.
CONSERVATION COMPLIANCE If you have highly erodible land (HEL) or wetland in your farming operation you must be in compliance with the FSA to receive the subsidy on your crop insurance for the 2016 crop year. A certificate of compliance (form AD-1026) must be on file at FSA by June 1, 2015, if you plant on converted wetland or plant on HEL without a conservation plan in place. The AD-1026 compliance form is continuous and will not need to be refiled unless changes are made to your farming operation in the future.
PASTURE, RANGELAND AND FORAGE INSURANCE The
Pasture,
Rangeland
and
Forage (PRF) Insurance program is a risk management tool provided by the federal MPCI program. Contact your FCS agent for more information on how this program can provide risk management for your hay and grazing operations.
Deadline for 2015 coverage is November 15, 2014.
NEWS BRIEFS
CELEBRATING AG DAY AT MIZZOU!
On August 30, MU kicked off the football season by holding their first annual Ag Day to benefit the College of Agriculture, Food & Natural Resources (CAFNR). FCS Financial was one of four sponsors for the event. Shown above FCS Financial’s Executive VP of Operations Jeff Houts (left) joins the other sponsors on the field to present a $2,000 scholarship to CAFNR. Visitors to FCS Financial’s tent received a rally towel and the opportunity to win a Made in Missouri gift basket.
OUR OFFICES WILL BE CLOSED As we approach the busy season of harvest and holidays, we would like to remind you of our holiday hours. All FCS Financial offices will be closed on the following days in 2014 in observance of the noted holiday.
Thanksgiving - November 27 - 28 Christmas Eve - December 24 (offices close at noon) Christmas Day - December 25 All offices will be open on Wednesday, December 31. Payments to be credited in 2014 must be received by noon on Wednesday, December 31. If you are a Funds Held customer, please notify your FCS Financial office by noon on Monday, December 29, to receive interest credit in 2014. 16
HEARTBEAT | FALL 2014
MISSOURI AG STUDENTS RECEIVE NEW CURRICULUM Agriculture students in Missouri high schools and junior colleges are learning from a new curriculum this school year. Funded by FCS Financial through a grant to the Missouri Department of Elementary and Secondary Education (DESE), the Ag Management, Economics & Sales curriculum is the first curriculum developed as a partnership between the public and private sectors. “A needs survey conducted three years ago identified a new curriculum was at the top of the list for Missouri’s ag teachers,” says Scott Gardner, FCS Financial vice president of sales and marketing. “The curriculum they were using was developed in 1988.” In response, FCS Financial and DESE joined forces with Vivayic, a learning solutions company, to develop the Ag Management, Economics & Sales curriculum which was unveiled in July during the Missouri Vocational Agriculture Teachers Association (MVATA) conference. “This curriculum is just what Missouri Ag Teachers needed as
we continue to prepare students for future endeavors in the agriculture industry,” says Ross Hastert, instructor at Rockport High School. “Thanks to FCS Financial and Vivayic, we have an up to date and detailed curriculum that is easy to follow and implement into the classroom. I am excited to introduce this curriculum to the Juniors and Seniors at Rock Port High School this fall.” The comprehensive goal was to bring together concepts from agricultural economics, management, sales and marketing and personal finance. The nature of today’s agricultural industry is reflected to prepare students for career success. “The activities within each lesson allowed for hands on experience and complete understanding,” says Chase Holcumbrink, instructor at Savannah High School, who taught the course during its pilot phase last year. “This curriculum allows students to make real world connections and learn valuable, lifelong lessons.”
MVATA developed the curriculum through a committee of 17 people representing school districts, post-secondary institutions, agriculture companies and agriculture economics experts. This committee provided subject matter knowledge during the three year development phase. FCS Financial Credit Analyst David Webb participated on the committee to build the finance and credit sections. “The lessons provided in the new curriculum not only are upto-date in terms of the agricultural environment, but also many of the activities for students are practical for today's students, such as the use of technology to apply the concepts from the lesson,” says Kelin Cruse, instructor at Cassville High School. The curriculum is web-based and available for free on the Missouri FFA Association website to provide the extra benefits of building in real-world links and projects as well as easy, around the clock access.
Your Feedback Matters to Us. The 2014 FCS Financial Service Quality Monitor will be mailed in October to randomly selected customers. The annual survey allows us to measure our current service, compare to previous years and plan for the future. If you receive the 2014 Service Quality Monitor, we appreciate your time in completing the questionnaire and returning it to Avant Marketing. Your feedback is invaluable to us as we strive to provide the customer service and products you expect. HEARTBEAT | FALL 2014 17
Don’t miss out!
Apply for an FCS Financial scholarship or grant today. scholarship Each year, FCS Financial honors the dedicated young men and women continuing their studies. We award up to thirty-five $1,500 scholarships to Missouri high school seniors whose parents or grandparents are current FCS Financial customers. Over the past 10 years, nearly $360,000 has been provided to help our next generation with their education. The 2015 application is due March 1, 2015.*
grant The Shaping Rural Missouri grant program offered by FCS Financial provides local 4-H and FFA organizations $500 grants to implement projects that will benefit their rural communities. Funds are awarded to assist club or chapter members in bringing positive change by establishing projects that make their local communities better places to live. Applications are due April 1, 2015.**
learn more Visit myfcsfinancial.com to learn more and apply for a 2015 FCS Financial Scholarship or Shaping Rural Missouri Grant.
*Scholarship applicants must meet all qualifications in application to be eligible **Grant applicants must be a 4-H club or FFA chapter located in one of the 102 Missouri counties served by FCS Financial.
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FCS Financial understands agriculture changes and staying on top of those can be challenging. Each year we offer several learning opportunities to customers. This year, we hosted seminars in Columbia, Hannibal, Marshall, Springfield and St Joseph. Richard Fordyce, Director of the Missouri Department of Agriculture, (shown right) shared an update on the State of Missouri Agriculture with producers in Springfield. Additionally, Scott Brown and Jim Wiesemeyer provided outlooks during some of the seminars. Photo by Christine Dickens .
INTEREST-FREE FUNDING AVAILABLE FOR 4-H AND FFA PROJECTS
Nearly $44,000 disbursed FCS Financial launched an agricultural youth funding program earlier this year to assist Missouri 4-H and FFA members with their agricultural projects. The agreement provides interest-free funding for qualifying projects, is available to all 4-H and FFA members in the association’s lending service area
Project Limits
and is repayable within one year.
Cattle - $2,000 max.
FCS Financial requires a detailed projected cash flow
Goats - $1,000 max.
as part of the application process. The goal is to emphasize
Horticulture - $2,000 max.
the importance of accurate records, budgeting and honoring
Poultry - $500 max.
obligations to repay in order to provide the future farmer or
Rabbits - $250 max. Sheep - $1,000 max.
rancher with the tools, skills and contacts to move forward into
Shop - $2,000 max.
a rewarding and successful agricultural career. If approved for
Swine - $1,000 max.
funding, the applicant must keep accurate records available for FCS Financial to review throughout the term of the agreement.
Funds are available for one project per year, per student. For
more details or to apply, visit www.myfcsfinancial.com or contact your local FCS Financial office. HEARTBEAT | FALL 2014 19
Protecting yourself
ONLINE
When the World Wide Web (WWW) was introduced in March 1989 by Tim Berners-Lee as a way for scientists around the world to share information his proposal was rejected. Berners-Lee, a British scientist for CERN, the European Organization for Nuclear Research, went back to the drawing board. By December 1990, the first website and server went live at CERN. In April 1993, the WWW was released to the general public and few could imagine the change it would have on how we communicate. Since the introduction of home computers followed by the Internet and Smartphones, technology has influenced our daily lives from how we learn and play to how we communicate and make purchases. Households with Internet use jumped from 18 percent in 1997 to nearly 75 percent in 2012, according to the United States Census Bureau. Smartphones certainly account for some of that increase since 45 percent of households in 2012 were using them. Technology has made many things easier, faster and more efficient. On the flip side, as use increases so does the potential for fraud and identity theft. FCS Financial recognizes your personal financial information is confidential and has policies, procedures and internal controls in place to protect your personal information. Additionally, we use encrypted technology for our Account Access online session. And while there are never any guarantees, we do work diligently to protect your information. Our privacy and security policies are available at www.myfcsfinancial.com. It is important to remember that Internet safety isn’t a one-sided coin. FCS Financial encourages those who use the Internet to learn more about online safety and ways to protect themselves. Always be aware of what information you are providing and to whom. Shown here are a few tips to help you navigate safely online.
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FCS FINANCIAL IS NOW OFFERING GRAINBRIDGE AT NO COST TO OUR CUSTOMERS. To take advantage of this special offer, contact your local office.
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Greetings from the Board Room: Some years ago, I told a neighbor I couldn’t feed $4 corn to feeder cattle. They seemed to eat it just fine but I had the uneasy feeling that I was going to choke with every bite they took. At that same time, I sat in our boardroom by a long time board member that was an early and ardent supporter of ethanol. He explained to me numerous times that because of the new demand for corn, we would never see the price of corn below $3 and not likely below $4. “Couldn’t and never” are dangerous words to use anytime and especially in relation to agriculture in general and markets in particular. Most of us are surprised at what we can do when necessary and “never” should certainly be used sparingly.
Over time, I have adjusted to feeding even more expensive corn to
livestock. But the recent increase in calf prices and decline in corn price has
James Nivens, Chairman of the Board
helped alleviate some of the discomfort I felt the past few years. And my fellow board member, who was confident that corn had reached a new baseline, retired from the board in 2010 and from actively farming some time after that. I wonder about his opinion of corn prices now?
Our last board meeting began the planning process for 2015. A slight downturn, compared to growth of the
past few years, had been expected this current year. Overall, results to date have been better than anticipated with very few exceptions. The association’s capital position continues to improve, earnings are strong, the quality of the loan portfolio is at historical highs and delinquencies could hardly be lower. The largest single area we missed was anticipating mortgage loan needs. The rapid decline in grain prices can almost be matched in the decline in new mortgage money. It’s early in the planning process, but I’m betting on the “downturn” of last year’s plan to be extended into the coming year.
Since our last board meeting, I have had the opportunity to participate in a planning project of AgriBank, our
source of funding, and the National Directors Conference, presented by the Farm Credit Council. The participants of at least parts of our planning session included FCS Financial management and staff, representatives of AgriBank, invited guests and 15 board members. I felt that we had a fairly diverse group and a wide ranging outlook discussion. Imagine the AgriBank meeting participants representing 17 associations, ranging in size from less than 200 members to over 80,000, and total loan volume $73 billion. Each association convinced that they were best serving their member needs. The discussions in the National Directors Conference included the funding corporation, AgriBank and the other three funding banks, and at least 60 different associations. The Farm Credit System nationwide includes nearly 500,000 members and a total loan volume of $260 billion. As I waited in the airport for a connecting flight home and began piecing this article together, the ancient story of the blind men and the elephant came to mind. Each blind man’s experience with which part of the elephant he contacted determined his perception of the entire animal. I realized that each of our perceptions of the Farm Credit System and even our own association is widely varied.
As you complete this year’s harvest and contemplate the reality of current grain prices or enjoy the greater returns
in the livestock industry, don’t let your perception of FCS Financial hamper your planning for the coming year. It’s our goal to help you both benefit the highs and weather the lows.
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Find an FCS Financial office near you:
1.800.444.3276
www.myfcsfinancial.com WWW.MYFCSFINANCIAL.COM
Crop Insurance We know it takes the right tools to run a successful farm. Most of us grew up on farms or in rural communities, and many of us still live there today. These experiences give us a real understanding of agriculture and what it takes to build a farm. Our passion for rural Missouri drives us but our experience and knowledge sets us apart from other lenders.
a Competitive rates with longer terms a Flexible payment schedules to match your cash flow a Experienced staff to make your financing process simple a Finance options to meet your specific needs Growing Relationships. Creating Opportunities. is a trademark of FCS Financial, ACA. FCS Financial is an Equal Opportunity Provider.