HeartBeat winter 2010
Stepping up to the challenge. page 6
Board of Directors — FCS Financial ACA James Nivens, LaRussell, Chairman
Maurice Glosemeyer, Marthasville
Brian J. Peterson, Trenton, Vice Chairman
Daniel Hulse, Hannibal
Kenneth Bergmann, Walnut Grove
Clyde Eugene McClellan, Willow Springs
Bruce Bjornson, Oro Valley, Ariz., Appointed
David Meneely, Chillicothe, Appointed
Michael L. Bruce, Nevada
Mark S. Pierce, DeKalb
Michael L. Cook, Columbia, Appointed
Gene H. Rademacher, Bland
Mark DeShon, Clarksdale
James Schulze, Troy
Dan Devlin, Edina
Office Locations Bolivar 417-326-4016 1-866-326-4016 Cameron 816-632-7265 1-800-225-6949 Carthage 417-358-0808 1-866-358-0808 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 Kirksville 660-665-6243 1-800-530-5512 Lebanon 417-588-5828 1-866-588-5828 Marshall 660-886-6897 1-800-228-6897
Maryville 660-582-6464 1-800-813-5722 Memphis 660-465-8984 1-800-407-8984 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 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 Shelbina 573-588-2156 1-800-432-2156 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: 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
Printed with farmer-grown soybean ink on recycled paper.
CONTENTS 4
Daryl’s Desk
5
Member Contest
6
Member Feature
11
Life is Simple
12
Youth in Ag
16
Dollars & Cents
17 Risk Management 18 News Briefs 23 Nivens’ Notes Find out how Ashly and Jason Brand started farming from the ground up and now balance work on their farm with jobs in town. Photos and article by Joann Pipkin.
DARYL’S DESK
Greetings – Recently I was asked to participate in a discussion with a freshman agricultural honors class at the University of Missouri. Since I escaped the privilege of attending anything close to an honors class during my student tenure at the University, I jumped at the opportunity. In preparation for this session with what would undeniably be our next generation of leaders in Missouri agriculture, I thought it best to rummage through my archives of past presentations to hopefully minimize my propensity for foot-inmouth disease. During that process, I came across a presentation I prepared in 1996 for a similar, but perhaps not as captive an audience. I thought this year-in-review might be an opportune time to share this dated and somewhat cloudy crystal ball. Here are my eight observations with a current assessment. Daryl Oldvader, CEO
2. 3.
4. 5. 6. 7. 8.
1. Agriculture is getting smaller. Today, while the number of farms
approximates 2 million, 10 percent of those produce 90 percent of the total value of agriculture output in the U.S. This imbalance continues to grow. Traditional farming will no longer be traditional. Driven by economics, family farms have become more specialized or niche-market oriented. Additionally, in 1960 50 percent of farm households reported off-farm income. Today, that number exceeds 80 percent. Bimodal distribution and divergence will become more distinguishable in agriculture. The traditional farm sector is evaporating into either the larger commercial sector or the smaller part-time farm sector. From 1991 to 2007, the number of farms considered very large doubled and the small farm sector increased by over 12 percent. Meanwhile, the traditional sector contracted by over 14 percent. These dynamics are impacting the economic landscape of agriculture. Selective farming: Commodities vs. Products. It is no longer simply #2 yellow corn or a pound of protein. Rather, more farmers are developing “products” marketed to a specific audience. Commercial producers will link into value chains. As economies of scale continue to develop in commercial farm operations, producers have found ways to extract additional product margins by becoming part of mega complexes and networks. Commercial vs. Lifestyle farming: Is the country big enough for both? As farming operations have become larger and more complex, this has challenged some of the basic elements of agricultural production resulting in a rash of environmental and animal welfare regulations. The Wal-Mart syndrome will regionalize the agriculture infrastructure. As we have watched rural America transform over the past 14 years, farm suppliers have congregated into areas supported by jobs, health care and education. These areas are typically populated with one or two consumer retail behemoths. E-commerce will hasten the disintermediation in agriculture. A decade ago, only one percent of the U.S. population utilized e-commerce for retail purchases. Today, four percent enjoy the opportunity to purchase goods and services online. That does not sound like much of an impact; however, when you consider consumers spend approximately $10 trillion each year - it is a significant advance. Admittedly, agriculture is not there yet, but e-commerce is quickly growing in this sector as well.
Well, that was my vision for agriculture from 14 years ago. Was it accurate? It doesn’t matter – we’re here. Now, for the next 14…hold on! Finally, as we celebrate the holiday season, it gives us cause to stand back and reflect on our blessings of life: family, friends, health and the freedom to worship and live in a democracy. We are grateful for the U.S. service men and women who stand watch to protect those freedoms. Many people around the world cannot comprehend the values that we merely accept as inherent to America. The Farm Credit System has provided credit to agriculture for 94 years. We have appreciated the privilege and look forward to the next 94! 4
HEARTBEAT | WINTER 2010
SEND US YOUR EMAIL ADDRESS FOR A CHANCE TO WIN AN iPad! Entering is easy. Simply contact your local FCS Financial office and provide your current email address by March 31, 2011*. If we already have your email address, call to verify that it is still current. We will update our records and enter you for a chance to win one of three iPads. Winners will be notified by email by April 14, 2011. Additionally, the winners names will be posted to our website and included in the Summer 2011 issue of HeartBeat. You may be wondering—”What are you going to do with my email address?” Rest assured, we will not sell or share your information. We simply want to provide you updated information about agriculture and FCS Financial. *Contest is for current FCS Financial customers only. Official rules can be found at www.myfcsfinancial.com.
MEMBER FEATURE
Finding Balance: Found Photos and story by Joann Pipkin
All along the highways and byways the dust flies. Combines roll. It’s har vest time in north central Missouri. As Highway 5 fades into the countryside southwest of Macon, it leads us down a lonely one-lane country road not far from the community of Mike, in Chariton Count y. Litera lly miles from civilization, this is rural Missouri. Headquartered for the day out of a machine shed at the edge of a corn field, it’s here that Jason and Ashly Brand scurry to ready their own big green machine for the task that lies ahead. Jason is anxious to get rolling. He knows there’s plenty of work to be done. And, he knows the only
way to get it done is to roll up his sleeves and get after it. But, Jason doesn’t just roll up his sleeves to crawl in the combine. At 33, this young entrepreneur is part of a new generation of farmers who splits his time between the fields and an off-farm job.
FROM THE GROUND UP Jason Brand didn’t inherit any acreage, nor is he one that can count generations of farmers before him. Although Jason’s father grew up on a farm, his dad sold his part of the land to Jason’s aunts. With parents that divorced when he was young, Jason gleaned some knowledge of the agriculture way of life from his
step-father and step-grandfather. He liked to help work the land, but as a teenager discovered he could earn more money working in his own father’s concrete business, Randolph County Foundation Company, in Moberly. A f ter h ig h sc hool, Ja son continued in the family business and fed his passion for hunting and wildlife every chance he got. In 1997 Jason and his dad made their first land purchase together. And in 2004, they went to FCS Financial to add to their acreage. It was an investment that could also be used for recreational purposes. Little by little Jason accumulated some farm equipment and more
dations and Farm Fields acreage. He grew tired of renting out his own land. “It just wasn’t benefiting us at all,” he recalls. And, Jason wasn’t always appreciative of the way his tenants were caring for the land. So, he started caring for it himself but he never quit his day job to do so. Instead, the young businessman f inds a way to ma ke the t wo occupations work hand-in-hand. And, along the way he found a partner. Working in Jason’s father’s concrete business, Ashly would often bring lunch out to Jason in the field. Eventually, the two would get married and have since found they make a pretty good team.
Ashly grew up on a cattle and hay farm in Miller County. “She’d just jump in and do things,” Jason credits his wife. “I didn’t have to ask her to help me.” Today, the two work side by side in both endeavors. Married three years, Jason is a self-professed positive thinker while Ashly helps keep him grounded and provides the “what if” to every situation. While growing up, Jason says he learned a lot about farming from his step-father, but is also self-taught in many aspects of his operation. “I’ve got a lot of friends who are farmers and I ask a lot of questions,” he says.
“I feel like you can’t learn a n y t h i n g i f y o u d o n’t a s k questions.” Even with his childhood farming knowledge, Jason says the business has changed since then. “Back then, there was no ‘Round-up Ready.’ It was all so much smaller scale.” Jason has built his farming operation to include about 1,200 acres of owned and rented ground, spanning three counties and over 40 miles from end to end.
SUCCESS ON THE FARM Hard work is the backbone behind the Brand’s operation. “My dad has taught me a lot about business,” Jason credits noting
Conventional till and no-till both have their place in Jason Brand’s operation. The young farmer is a huge wildlife fan and strives to make good habitat while leaving highly erodible soils in the Conservation Reserve Program. Brand markets his grain with the help of risk management/forward contracting. He says there’s only a certain amount of profit per acre so more acres means more profit. In addition to corn, the Brands grow soybeans on about 1,200 acres of owned and rented ground.
that farming and concrete are very different from each other but yet are also very similar. He says it takes dedication and a “don’t quit” attitude to get both jobs done. “Dad and Mom taught me my work ethic and how to be
conservative. Spend the money to get things fixed when you need to because you’ve got to get back to work,” he says. Jason says the hardest part of farming is being able to afford the equipment to do the job efficiently
enough to make any money. “Being able to purchase newer equipment with the help of FCS Financial has enabled our operation to become more efficient and safer,” Jason notes. According to Jason, keeping up
with technology and changing times is critical to his operation. “There’s so much out there in seed varieties, chemicals–there’s so much to read and learn about.” Locating farms to rent is an ongoing challenge, too. Jason notes his dad has been a huge help with that. “I like to cash rent,” Jason explains, “because when I pay that rent, then I control everything from there on out. I am my own boss. If I’m renting it for halves or whatever then the (landlord) is telling me when I do this and that and how they want to take care of their part of the grain.” Conventional till and no-till both find their place on the Brand operation, but Jason is quick to point out that no-till is definitely the future. “I think there will be a
time when we are told we can’t work ground (by conventional tillage).” A huge wildlife fan, Jason says, “We try to do everything we can to make good habitat, leaving the highly erodible soils in CRP (conservation reserve program).” He’s adamant about leaving a portion of the crop for deer and he installed grass waterways this fall which were seeded to wheat and clover. In the spring, he’ll turn the waterways over to warm season grass for quail and turkey. “I don’t like to see people misuse the land,” Jason says. “You get back what you put into it.” Risk management via forward contracting helps Jason find the best prices for his crops. He says, “If you can market at least some of your grain by the time it’s planted, that’s a good deal. But, it doesn’t always work that way.”
FCS Financial’s Jack Glover (r) works closely with Ashly and Jason Brand on real estate, equipment and farm operating loans. Glover expects to see more and more people that are pushed into having a second occupation in order to make it on the farm.
Jason Brand readies a tractor to haul grain in from the field during harvest. Brand says being able to purchase newer equipment with the help of FCS Financial has made his operation more efficient and safer.
Quick to credit his parents for instilling in him a work ethic, Jason Brand combines that with a “don’t quit” attitude to help him balance working on the farm and in his father’s concrete business.
For example, Jason notes that last year he sold about half his crop by the time it was planted. “I like to contract enough of the crop to pay the bills first. Then, I can gamble on a higher market with what’s left,” he points out. Just in his infancy, Jason already realizes the importance of growing his operation. “There’s only a certain percentage of profit in an acre and the more acres you have, the more profit,” he adds.
IN HIS BEST INTEREST Back in 2004 when Jason Brand and his father were ready to purchase additional land, Jason says FCS Financial was the place to go for the best interest rates —and they were willing to loan money for agricultural acreage. “FCS is in the ag lending business,” Jason says. “It definitely gives me peace of mind. They understand the agricultural process.” FCS Financial’s Jack Glover
has worked with the Brands for two years, assisting with their operating line of credit and equipment loans. The Brand’s real estate loans were in initiated in 2004. “Their enthusiasm has been a trigger for me to enjoy working with them even though they didn’t come from traditional family farms,” Glover says. “I have really enjoyed the fact that they want to grow their operation..and do it the right way.” Glover adds, “I think we will continue to see more and more people that are pushed to having more than one occupation in order for them to farm, because they’re not fortunate enough to inherit a large operation or are not well-positioned to begin with.”
KEEPING BALANCE With limited help from Ashly’s father, who handles grain trucking, the Brands seem to burn the candle at both ends. When Jason works concrete, Ashly works there in the office; when Jason is in the field, Ashly’s in the field. Jason notes the last few years
have been really trying because of the wet weather. “When you have a window open where you can work, you need to get out there and do everything.” While balancing farm life with the concrete business, Jason realizes he must also find balance at home. “There’s just so much to do. Even when you get home at night, there are bills to go over. There’s just no time,” he says. “The work isn’t the hard part; it’s keeping the balance.” W het her he’s work ing in concrete or in the field, Jason realizes the only way to get the job done is to simply step up and do it. Yet Jason Brand’s words are spoken not like a part-time farmer with less than 10 years under his belt, but like a seasoned veteran with generations of knowledge from which to glean. “You’ve got to get in there and get the work done as efficiently as you can. You can’t sacrifice quality at all. You have to give 100%.”
Ashly Brand grew up on a cattle and hay operation in Miller County and although she had no intensions of marrying a farmer, today she and husband Jason work side by side in the field. In addition, Ashly works in the office of Jason’s dad’s Randolph County Foundation Company.
my neighbors started using poultry litter as an alternative, but now that those prices have gone up to equal or exceed those of commercial fertilizer, it also seems not to be an option. I just called my fertilizer dealer and he informed me the prices will be significantly higher this year. Conclusion—I guess I’ll repair my old manure spreader start slinging it again—something for which my neighbors say I’m very proficient. Fuel. Diesel prices continue to inch upward. About the only way to save fuel in my operation is to stop clipping pastures in the summer. But if I do that, then the weeds will certainly take over the farm— especially since I quit fertilizing. I could start putting off-road diesel into my pickup truck, but just yesterday I passed through a DOT checkpoint at the intersection of the state highway close to my home. The $1000 fine and six months in prison doesn’t seem like a viable alternative, although the free room and board during my imprisonment would be a huge cost-saver. Conclusion—No change in my current operation. Feed. My motto has always been, “If it’s not grass, my cows will pass.” About the only feed I buy is what grain I feed to the blind calf and three-legged cow that will be butchered for the home freezer. Conclusion—The only direct effect that high feed prices have on my operation is the lower prices I receive for my calves. Taxes. Yeah, right. (Or, as someone recently said, “The rent is too @#$% high!”)
LIFE IS SIMPLE
A wise old professor of farm management, whom I once studied under, taught us that this is the time of year when we should sit down and re-evaluate what we’ve done and what should be changed for the next production cycle. Since the old gentleman was not only a great teacher, but a very successful farmer as well (a rarity in higher education), I’ve decided to finally heed his advice. He preached that they ways to increase prices received for output produced were both limited and complicated. Forward contracting and hedging on the futures market were two things that he tried his best his best to explain to our class, but it always seemed to me that these methods were much more applicable to crop farmers than cattlemen. That, plus the fact that I flunked the test over that material, made me realize that I should just continue to sell my product at the livestock auction barn. So…..no change in marketing for the coming year. The major part of his class that I did understand related to controlling the cost of inputs into the farm operation. Since we can’t control prices to much extent, lowering the costs of our expenses should improve profits, right? Here’s my list…and my decisions on the big ticket items: Fertilizer. I had to quit spreading commercial fertilizer on pasture ground about four years ago. With the huge increase in prices due to the so-called energy crisis, I calculated that the only land I could afford to fertilize was the acreage I was going to cut for hay. Some of
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, and their sons, Seth and Zach, 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 2010, Jerry Crownover
Cost of cows and bulls. Finally, an input that I can reduce! You see, I always start my calving season the first week in February, but here it is the last part of November and I already have six spring calves on the ground. It would appear that I have absolutely no need for the six high-priced bulls that I own, since my neighbors’ bulls seem to be more than adequate in keeping my cows bred. That would also lower the costs I incur on fence repair and maintenance. Conclusion—Sell the bulls and rely on the generosity of neighbors. I knew, all along, that my money wasn’t wasted on that college degree in agriculture. I should have been doing this year-end evaluation long ago. Thanks, Prof. HEARTBEAT | WINTER 2010 11
YOUTH IN AG
WHERE ARE THEY NOW?
The 2005 FCS Financial Scholarship Recipients Since its inception in 2004, FCS Financial’s Scholarship Program has given away $221,000 to 221 recipients. FCS Financial board of directors implemented the program to encourage and support higher education for relatives* of FCS members. Up to 35 scholarships of $1,000 each are offered each year. FCS Financial is committed to supporting the agricultural youth of Missouri. As a cooperative, this scholarship is one of the ways FCS Financial gives back to its members and supports communities. In 2005, just the second year in which scholarships were awarded, 30 prizes totaling $30,000 were given. With the 5th anniversary of the 2005 FCS Financial Scholarship recipients upon us, we take a look at what some of the recipients are doing now.
Brandi Abbiatti Originally from Lockwood, Mo., Brandi received a B.S. in biology from the University of Missouri-Columbia and is now in graduate school at Midwestern University in Chicago. She is currently on clinical rotations, and expects to graduate in August 2011 as she completes her physicians assistant degree program.
Tiffany Oetting
A volunteer with Big Brothers/Big Sisters, Tiffany Oetting spends time with her little sister Christina when she’s not working with Columbia Insurance Group in Columbia. Tiffany is a graduate of Missouri State University.
Through Missouri’s A+ tutoring program, Tiffany graduated from Moberly Area Community College before earning a degree in general business from Missouri State University in Springfield. An internship with the Missouri Department of Insurance in Jefferson City helped get her foot in the door there as an office support assistant and would later help Tiffany land a job with Columbia Insurance Group where she’s now been employed since June 2010. The Columbia, Mo., native volunteers for Big Brothers/Big
Sisters and also recently took up ballroom dance lessons.
Tyler Jones Tyler always knew he wanted to farm. But, that didn’t stop him from earning a college degree first. A graduate of the University of Missouri-Columbia with a degree in agriculture systems management and a minor in agriculture economics, Tyler graduated in 3 1/2 years. He’s now back home on the family farm near Dawn, Mo. 12
HEARTBEAT | WINTER 2010
“Farming is always what I wanted to do,” Tyler explains. “I had the opportunity to come back here and it’s something I enjoy.” The Jones’ operation includes row crops, hay production and beef cattle. While at MU, Tyler was active in Alpha Gamma Rho fraternity, Collegiate Farm Bureau and the ASM Club (Ag Systems Management). He also studied abroad in Brazil. “That was a good experience,” Tyler says. “We got to see how farming is different with a major U.S agriculture competitor.” Tyler also traveled to Costa Rica through the National FFA Organization while he was in college as he was a National Proficiency Award winner in Fiber and Oil Crop Production Placement/Entrepreneurship. “I met folks from all over the U.S. and witnessed other farming practices (while in Costa Rica),” Tyler says. “The U.S. is much more advanced technologically than either Brazil or Costa Rica.” He’s quick to point out that friendships made then are still enjoyed today. In addition to working on the farm, Tyler is on the Livingston County Farm Bureau Board, and is the vice president of the Livingston County Young Farmers and Ranchers Association.
Karlee Rasor Marvin
Tyler Jones studied abroad in Brazil while attending the University of Missouri. Now back home on the farm, Tyler says, “We got to see how farming is different with a major U.S agriculture competitor.”
Through Bolivar Technical College in Bolivar, Mo., Karlee earned an associates degree in nursing. She’s now an R.N. in the emergency room at Ozarks Community Hospital in Springfield and takes part in the Rural Nurse Initiative, an on-line program which will aid Karlee in earning a B.S. degree in nursing from the University of Missouri Kansas City. Karlee lives in Springfield, is married to Shawn Marvin and has a six-year-old step-daughter.
Kinsey McCartney Kinsey is currently attending graduate school at Trevecca Nazarene University in Nashville, Tenn., where she is studying to be a physicians assistant.
Ryan Paul Ryan earned an associates degree in livestock production from Crowder College and currently works for Miracle Recreation in Monett, Mo. While at Crowder, Ryan interned with Allen Canning, Co., where his work took him to New Mexico to job shadow Allen field representatives and monitor plant health, weed problems and estimate harvest.
Andrew Plassmeyer Following high school Andrew attended College of the Ozarks and worked at the school’s dairy farm. In 2007, Andrew transferred to Linn State Technical College where he netted a degree in Networking Systems Technology. Andrew currently lives near Linn, Mo., and continues to help on the family beef cattle farm in addition to working as an IT professional at Linn State. HEARTBEAT | WINTER 2010 13
Brooke Varner As a bank examiner for the Federal Deposit Insurance Corporation, in Kansas City, Brooke is there to protect your rights as a consumer in the banking industry. She graduated from the University of Missouri in May 2009, having majored in business and finance while in college. An internship with FDIC helped open Brooke’s eyes to the field and then she was offered a position right after graduation. In her work, Brooke evaluates the financial condition of banks and makes recommendations for improvements. While at MU, Brooke was active with Kappa Delta, was on the homecoming steering committee, the largest student-run homecoming in the nation. She also worked for the MU Alumni Association and was selected as Mizzou 39 recipient. That application process picks the top 39 students in Mizzou’s graduating class based on academics, community service and leadership. Brooke is also a volunteer for Big Brothers/Big Sisters in the Kansas City area.
Kate Probert
With experience at several national artificial insemination companies, Kate Probert recently accepted a position with Alta Genetics in Watertown, Wisc., where she’ll work in the company’s sire health department.
Kate is a December 2008 graduate of the University of Missouri where she earned a degree in animal science. While at MU, she worked at the university dairy and continued to be active showing dairy cattle attending the World Dairy Expo in Madison, Wisc., and North American International Livestock Expo in Louisville, Ky. Two internships also took Kate to Wisconsin while in college. In Shawano, Wisc., at Genex Cooperative, Kate gained experience in implementing super ovulation programs in the dairy industry. While working for Accelerated Genetics in Baraboo, Wisc., Kate assisted with progeny promotions for new prospective bulls. Beginning this month (December) Kate takes a position with Alta Genetics where she’ll work in the sire health department. She was formerly a customer service representative for Semex. Planning a February wedding, Kate resides in Watertown, Wisc.
Jamie Reichert Case Originally from Marshall, Mo., Jamie graduated in May 2010 with a doctorate in physical therapy from the University of Missouri. She is currently a physical therapist at Peak Performance in Marshall. Not only was Jamie on the dean’s list in college, she completed a seven year degree program in five years of schooling and graduated Magna Cum Laude. She was a member of the student health advisory council while in college and also Kappa Kappa Gamma sorority. In 2008, she attended the Physical Therapy Association Conference in Philadelphia. Jamie is married to John Case and the two live in rural Marshall.
Sean Hutchinson Sean received a bachelor’s degree in social studies education from the University of Central Missouri (UCM). The Chilhowee native is currently working on his master’s degree in psychology at UCM while also being the soccer coach and ISS (In-School Suspension) instructor at Clinton High School. He also helps out on the family farm. Sean hopes to eventually work as a high school social studies instructor and teach psychology at the college level.
Jamie Vest Lebanon, Mo., native Jamie Vest continues to run the distance —now in graduate school at Missouri State University 14
HEARTBEAT | WINTER 2010
in Springfield. She first earned a bachelors degree in animal science, with a minor in agriculture business. Jamie is now furthering her education in small ruminant research. Jamie won the MSU College of Natural and Applied Science Undergraduate Research Poster Contest in the agriculture category. She also attended and completed the Howard Wyman Sheep Industry Leadership School in 2009 at Greeley, Colo. With aspirations of returning to the family sheep and cattle farm, Jamie says her graduate work teaches her to “think out of the box” and puts her out in the real world. Right now, Jamie says agriculture is on the defense with so many non-agricultural people in the world. “You have to constantly think of new ways of doing things,” Jamie explains. In addition to her course work in agriculture, Jamie competed in both cross country and track at MSU and went to NCAA (National Collegiate Athletics Association) Nationals in track.
Stephanie Oetting Wilckens A graduate of the University of Missouri, Stephanie is a registered nurse at Boone County Hospital in Columbia where she specializes in cardiac surgery. While at MU, Stephanie was active in Kappa Alpha Theta sorority, was on the Greek week steering committee, and was one of three nominated for an overall nursing excellence award her eighth semester. In her work at Boone County, Stephanie began as a charge nurse in March 2010. Her manager selected her to be a “super-user” for McKesson Horizon Clinicals, a new charting system at the hospital. Stephanie would serve in that role as support system for hospital staff. With aspirations of obtaining her doctorate’s degree in nursing practice, Stephanie hopes to find out by year’s end if she’s accepted to graduate school. She married Michael Wilckens in August 2009 and they reside in Columbia.
Jamie Vest is studying small ruminant nutrition in her graduate work at Missouri State University in Springfield. She says her graduate studies teach her to “think outside the box”. As part of his position with John Deere, Rob Zuroweste is currently in charge of the electrical distribution for a multimillion dollar project at Deere’s plant in Waterloo, Iowa.
Robert Zuroweste Rob is a graduate of Missouri University of Science and Technology in Rolla where he received a degree in electrical engineering. In college, Rob interned twice with General Motors. After school, he went to work as an electrical facilities engineer for John Deere. He currently works at the Deere plant in Waterloo, Iowa, where tractors constructed. Currently in his job at John Deere, Rob is in charge of the electrical distribution for a multi-million dollar project. He’s married to wife, Ellie.
Learn More: Log on to www.myfcsfinancial.com to learn more about the FCS Financial Scholarship program. Applications are available on-line. Deadline to apply is March 1, 2011. Recipients will be notified by April 15, 2011. *Relatives include children and grandchildren of FCS Financial members.
HEARTBEAT | WINTER 2010 15
DOLLARS & CENTS
LOW RATES CONTINUE — Developing Year-End Financial Reports Gary Irwin, VP of Administration
THE INTEREST RATE ENVIRONMENT—TODAY 1. FCS Financial provides you access to a full range of loan funds that remain at historically low rates. As you look at the 30-day vs. 15-Year Farm Credit Bond chart you’ll see that 30-day issues have remained at historically low levels for the last two years with 15-year issues moving downward since earlier this year. The gap between short-term rates and long-term fixed rates remain wider than seen during the 1990s; however, since late 2009 the gap between short- and long-term bond costs have narrowed by almost two percent. 2. Interest rate risk management options. By locking in historically low, fixed rates on real estate loans or other term loans, you can avoid escalating interest costs should interest rates move upward. In today’s low rate environment, avoiding future interest rate risk on term loans is one part of the cash flow equation that can be managed by using fixed rates or long-term adjustable rate products. 3. Loan conversion options. Conversion options on those loans that do not include prepayment penalties are available to existing loan customers. This option is generally less costly and simpler than refinancing your loan.
FINANCIAL MANAGEMENT ACTIVITIES—VOLATILITY & YEAR-END RECORDS 1. Financial Information & Records. The economic and political climates remain volatile 15-Year Farm Credit 30-Day Farm Credit Fed Funds Target which causes financial decisions being made today to lack clarity when you look beyond the short-run. Said another way — if you successfully buy an adjoining tract of land today, when you look back on that purchase in five years will this purchase look like a good decision or one you regret. As you make key financial decisions in this type of climate, you, as well as your lender, need access to quality financial records from which to base decisions. As a starting point, quality financial records require that you annually have access to a complete and detailed balance sheet that matches the ending date of your earnings information. As such, those of you with fiscal year-ends of 12-31 should be in the process of gathering financial data to then pull together your 12-31-10 balance sheet shortly after year-end. Date Online websites that can provide you access to electronic financial forms to assist in building a quality set of financial records would include the following: • FAST Tools, a suite of Microsoft Excel spreadsheets designed to assist those in agriculture to make better decisions via user-friendly computer programs: www.farmdoc.illinois.edu. • FAPRI-Missouri Farmer’s Corner includes tools to help you with your operation: www.fapri.missouri.edu. 2. Communicate, Communicate, Communicate! Frequent and early discussions with your loan officer are paramount when working through new loan requests and/or servicing requests. Quality year-end financial records should help you articulate your current situation and operational plans for the next 12 to 24 months. In turn, you can make better operational decisions and improve on your financial staying power in today’s uncertain times. Working closely with your local FCS Financial expert early and often and providing quality financial information during those discussions is a prerequisite to a lasting relationship. For more information on rate options, including conversion opportunities, call your local FCS Financial office or visit our web site at www.myfcsfinancial.com.
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HEARTBEAT | WINTER 2010
12/31/2010
6/30/2010
12/31/2009
6/30/2009
12/31/2008
6/30/2008
12/31/2007
12/31/2001
6/30/2001
12/31/2000
0.00
6/30/2007
1.00
12/31/2006
2.00
6/30/2006
3.00
12/31/2005
4.00
6/30/2005
5.00
6/30/2004
All-in cost
6.00
12/31/2004
7.00
12/31/2003
8.00
6/30/2003
9.00
6/30/2002
10.00
12/31/2002
30-Day vs 15-Year Farm Credit Bond
Important Dates to Remember
Bob Idel, VP of Insurance It’s not too early to review your crop production records and start thinking about 2011. Some things to consider include: • Did you have the right crop insurance policy? • Was your coverage level adequate to cover high input cost? • Did 2010 yields raise your APH higher and you might want to buy up in 2011? • Were you satisfied with the service you received from your agent? • Do you have questions about the new 2011 Common Crop Policy? • Are you looking for a different insurance company? At FCS Financial our Risk Management Specialists always try to provide the best service and help you understand your policy options. We also write insurance through numerous insurance companies and can transfer your policy from another agent or company if you have current concerns with your present situation. If you’re looking for a new crop insurance agent or company contact one of our Risk Management Specialists. Office phone numbers can be found on page two or visit myfcsfinancial.com.
December 24 Last day to report losses on spring crops
Starting to plan for 2011?
March 15 Last day to sign up for spring crop insurance March 15 Last day to make any changes to existing coverage April 29 Production reports due for all spring-planted crops
RISK MANAGEMENT
Harvest completed?
2011 Common Crop Policy Reflects New Names, Similar Protection for Spring Crops POLICY CONVERSION For the 2011 crop year, CRC,RA,IP,IIP and APH plans of insurance will automatically be converted to the plan closest to the current coverage for the following crops: Corn, cotton, canola/rapeseed, sunflower, wheat, barley, malting barley, grain sorghum and soybeans Note: The following conversion chart applies to the above listed crops only.
2010 Policy
Converted for 2011 Crop Year to:
Crop Revenue Coverage (CRC)
Revenue Protection
Revenue Assurance (RA) with Fall Harvest Price Option Revenue Assurance (RA) without Fall Harvest Price Option Actual Production History (APH) Income Protection (IP)/ Indexed Income Protection (IIP) CAT Income Protection (IP)/ Indexed Income Protection (IIP)
Revenue Protection Revenue Protection with Harvest Price Exclusion Yield Protection Revenue Protection with Harvest Price Exclusion Revenue Protection with Harvest Price Exclusion (50/100)
Additional information is always available on the RMA website at www.rma.usda.gov/policies/ FCS Financial is an Equal Opportunity Provider.
HEARTBEAT | WINTER 2010 17
NEWS BRIEFS
Missouri Farmers Award “ULTIMATE AT-HOME TAILGATE PARTY” Kansas City Winner Receives New Television, Gas Grill and Free Groceries
Stacie Edwards (center), husband Mike, 7-year-old son Hunter, and 4-year-old son Cody (not pictured) of Independence, Mo., receive $750 in grocery gift cards through the “Ultimate At-Home Tailgate Party” sweepstakes. Presenting the award at Heins Family Farms in Higginsville, Mo., are dairy farmer Paul Heins (right) and Billy Thiel, chairman of the Missouri Corn Merchandising Council (left).
O
n November 20, one lucky winner was awarded the "Ultimate At-Home Tailgate Party," wrapping up a five month sweepstakes launched by Missouri farmers. Stacie Edwards of Independence, Mo., was the happy recipient of the prize package consisting of a new 46-inch flat screen television, gas grill and $750 in grocery gift cards. Just in time for the holidays, Edwards accepted her award at Heins Family Farms near Higginsville, Mo. Afterward, Stacie, her husband Mike, and oldest son Hunter had the opportunity to tour the Heins' dairy farm and 18
HEARTBEAT | WINTER 2010
experience agriculture firsthand. The Edwards also have a 4-year-old son, Cody, who was not at the event. Both boys are diagnosed with spinal muscular atrophy (SMA), a disease that causes progressive muscle degeneration and weakness. "Today was a great learning experience for Hunter... it has been a neat opportunity for him and for us," Stacie said. "And this prize is going to help us out a lot, especially with all the medical bills." Sponsored by 11 agricultural groups and agribusiness organizations, the "Ultimate AtHome Tailgate Party" sweepstakes launched in May and concluded
Oct. 4. During the promotion, consumers could log on to www. farmersfeedus.org, watch videos featuring five Missouri farmers and complete an online entry form by answering a question about each farmer. "I thought it was interesting to watch the videos online and see some of the newer farming practices," Edwards said. "I've always been a town girl so seeing what the different farmers are doing and how they are trying to be green... I realized a lot of the farm families are families just like mine but with a different lifestyle." Randomly selected from more than 12,000 registrations, the "Ultimate At-Home Tailgate Party" prize package Edwards received is valued at $2,850. The online sweepstakes ran in conjunction with a St. Louis Cardinals promotion to educate consumers about modern agriculture and the care Missouri farmers put into raising food, fuel and fiber. “It used to be that most people had a grandpa or uncle that farmed, but now we’ve got to work harder to tell agriculture's story – and it is an important one to tell,” says dairy farmer Paul Heins. “If we are concerned about our national security interests being jeopardized by getting our oil from the Middle
East, it’s even riskier to have to buy our food from South America. We want consumers to know how their food is raised and how important it is to have their food raised domestically.” Sponsoring groups for the "Ultimate At-Home Tailgate Party" initiative included the Missouri Corn Merchandising Council, Missouri Beef Industry Council, Missouri Soybean Merchandising Council, Midwest Dairy Association, FCS Financial, Missouri Farm Bureau, Missouri Egg Council, MFA Inc., Missouri Pork Association, National Pork Board and the St. Louis Agribusiness Club. "We hope projects such as the 'Ultimate At-Home Tailgate Party' and our partnership with the St. Louis Cardinals help put a face on today's farmers," said Missouri Corn Merchandising Council Chairman Billy Thiel, a grain farmer from Marshall, Mo. "To us, farming is more than a profession. It is a commitment to providing consumers with safe, nutritious and affordable food, caring for our land and our animals, and giving back to our communities." Missouri's nearly 108,000 farmers contribute more than $12 billion to the state's economy. And thanks to advancements in science and technology, today's farmer feeds 150 people on average. This holiday season, learn more about the farmers behind the feast and virtually tour one of the five featured farms online at www. farmersfeedus.org.
The Heins family works with a nutritionist to formulate the best diet for their dairy cows. During the farm tour, “Ultimate At-Home Tailgate Party” winner Stacie Edwards (right) and 7-year-old son Hunter explore the texture of dried distillers grains, a high quality feedstock and ethanol co-product purchased from local ethanol plants. Additional feed ingredients include cotton seed, wet corn gluten, soybean meal, corn silage, hay, and other vitamins and minerals
Wrapping up the tour, sixth generation dairy farmer Chris Heins (right) talks with Hunter Edwards about how the family cares for their Holstein calves. Growing up on the farm, Chris recently graduated from college and returned home to help run the family operation. Using the latest technology, the Heins family strives to create an atmosphere that is friendlier for the cows and the environment while preserving resources for future generations. HEARTBEAT | WINTER 2010 19
Master Farme Recognizes M The Missouri Master Farmer Award Program is proud to announce its 2010-11 class of winners. The Missouri Master Farmers are William “Bill” Masters of Cape Girardeau, Rick Rehmeier of Augusta and Gregory Wade of Stewartsville.
Coordinators of the award
program are Missouri Ruralist magazine and University of Missouri Extension. Gold sponsor FCS Financial funds the awards and educational program.
The Master Farmer Award
recognizes farmers who work hard every day for better, more efficient methods of raising crops and livestock. Nominations are open to all Missourians involved in production agriculture. The judging committee selects the best managers with innovative ideas, business skills, financial recordkeeping, soil and water conservation practices, a g r ic u lt u r a l le a der s h ip, a nd community service.
“This program recognizes active
farmers who have not only been successful in farming, but who are also assets to their communities and can help guide young farmers,” says Ron Plain, MU Extension agricultural economist.
An awards banquet for the
winners will be held Saturday 20
HEARTBEAT | WINTER 2010
er Award Missouri’s Best evening, Feb. 19 at the 2011 Missouri Young Farmers/Young Farm Wives Convention. Each Master Farmer will receive a $1,000 cash prize and an award plaque. Also planned is an educational roundtable
IMPORTANT NOTICE TO SHAREHOLDERS View the 2010 Annual Report on March 15 by visiting myfcsfinancial.com.
discussion with representatives from
FCS Financial will provide the 2010 Annual Report in
MYF-YFW and the audience. The
two different ways in accordance with Farm Credit
roundtable is Sunday morning, Feb.
Administration regulations.
20. All events are at Courtyard Marriott Hotel, Columbia.
The Master Farmer Award is the
nation’s longest running agriculture
An electronic copy will be posted to our website no later than March 15, 2011. Additionally, we will mail
aw a rd prog r a m. St ate s w it h
a printed copy, to each shareholder of record as of
established award programs include
December 31, 2010. The printed copy will be mailed
Missouri, Iowa, Illinois, Indiana, Kansas, Michigan, Wisconsin,
no later than March 31, 2011
Pennsylvania, Maryland, Delaware, New Jersey, and West Virginia. Photos from top: William “Bill” Masters, Rick Rehmeier and Gregory Wade.
Customer Appreciation We would like to thank you for your business and celebrate the accomplishments of your cooperative. We hope you will make plans to join us for Customer Appreciation Day. This year we are celebrating in conjunction with National Ag Day in March. Refreshments will be provided. Date: March 15, 2011 Time: 10 a.m. to 6 p.m. Place: Your local FCS Financial office Watch for more details at myfcsfinancial.com. HEARTBEAT | WINTER 2010 21
You’re Invited! Please Join us for a Seminar with Jim Wiesemeyer and Pat Guinan, Ph.D. Make plans now to attend one of eight seminars around the state sponsored by FCS Financial to help you succeed in 2010 and beyond. James “Jim” R. Wiesemeyer, Senior Vice President, Farm and Trade Policy at Informa Economics and Washington consultant for Pro Farmer newsletter, will present “The Business of Agriculture: What’s Ahead and What to do About It — A candid look at the policy and price outlook for U.S. agriculture from a global perspective.” Pat Guinan, Ph.D., Professor of Climatology at the University of Missouri-Columbia, will discuss “Historical and Recent Climate Trends in Missouri.” FCS Financial representatives will also provide brief updates on the association and 2011 spring crop insurance provisions. Lunch or dinner will be provided at all seminars. Space is limited and advance reservations are required by February 10. To reserve your spot, call your FCS Financial office at 1-800-444-3276.
22
City
Location
Date
Time
Lake St. Louis
Lake St. Louis Banquet Center 10600 Veterans Memorial Parkway
February 17
Registration - 9:30 a.m Seminar - 10 a.m. - 2 p.m.
Columbia
Stoney Creek Inn 2601 S. Providence Road
February 17
Registration - 5:30 p.m. Seminar - 6 p.m. - 9:30 p.m.
Hannibal
Quality Inn & Suites 120 Lindsey Rd.
February 18
Registration - 9:30 a.m Seminar - 10 a.m. - 2 p.m.
Lamar
Thiebaud Auditorium 105 E. 11th St
February 22
Registration - 9:30 a.m Seminar - 10 a.m. - 2 p.m.
Warrensburg
Elks Lodge 822 E. US Business 50
February 23
Registration - 9:30 a.m Seminar - 10 a.m. - 2 p.m.
Marshall
Martin Community Center 1985 South Odell Avenue
February 24
Registration - 9:30 a.m Seminar - 10 a.m. - 2 p.m.
St. Joseph
Stoney Creek Inn 1202 Woodbine Rd.
February 24
Registration - 5:30 p.m. Seminar - 6 p.m. - 9:30 p.m.
Chillicothe
Elks Lodge 401 Harvester Road
February 25
Registration - 9:30 a.m Seminar - 10 a.m. - 2 p.m.
The views and opinions offered by the speakers or their associated firms are solely those of the presenters, and do not necessarily represent the views of FCS Financial. Ag & Business is a registered trademark of FCS Financial. FCS Financial is an Equal Opportunity Provider.
HEARTBEAT | WINTER 2010
NIVENS’ NOTES
Greetings from the Board Room:
Everyone knows the story of Missouri weather – just wait a while and
it will change. Seems like the same adage can now be applied to most everything in the ag economy. The economy may require a bit more time than the weather to change but certainly doesn’t take much and this fall, I’m beginning to think that the weather is more stable. I have read that the volatility and wide swings in farm income and expense are to be the “new normal” in our lives. Fickle weather, global influences, increasing regulations, and any combination of excuses can be pointed to as being responsible. But unlike the weather, we can do something about our personal “economies”.
The success of FCS Financial is directly tied to the fate of our membership.
With the financial melt down of two years ago, you could see a wreck coming.
James Nivens, Chairman of the Board
The livestock segments of the portfolio certainly witnessed it. The association’s results of 2009, though admirable, weren’t in line with the trend of the past few years. The results indicated for this year would appear to be even better than planned. If you were to chart the association’s earnings over the past few years, it would like look like one of the grain price charts. A steady upward trend, a drop nearly out of sight, and a rebound the next year that gives you cause to wonder. The talk at any coffee shop would point to the “speculators”. Certainly not the case here but simple evidence that although you can’t influence the weather you can do something with at least parts of the economy. There has been some help in ag prices, but the FCSF staff and management put a plan into effect early in the year to focus on what we could change. No silver bullet but a concentrated effort to do the right things, at the right time, and in the right manner. It has certainly worked and this with some of lowest interest costs delivered to our borrowers that I can remember.
The trick now is for us as members, in our own operations, to apply some of the same focused efforts. As farmers,
most of us concentrate on the production aspects. With today’s volatility and “new normal”, maybe now is the time to do something a little different. No doubt some of you are like I am. You’ve been to enough marketing programs, you could nearly teach it yourself. Probably one of the best places to start would be to visit with one of the FCSF insurance specialists. Let’s first avoid the wrecks that we know can happen.
I can’t change the weather but it has been so mild and favorable this fall that I feel almost desperate to make
full use of it. In reality, I have probably just started more projects than I can finish before this time next year. At least we have “weathered” another election and the noise is over. I still have the adjustment to make with the time change. In the first few days, I’m never quite sure if all the clocks are right and no doubt next spring, when it comes time to change back, I’ll find at least one that has been there all along. I have always heard that a person with just one time piece knows what time it is, with more than one, you’re never quite sure.
Time now to reflect on the past year, be thankful for our many blessings, look forward to the holidays, and the
coming year.
HEARTBEAT | WINTER 2010 23
PRESORT STANDARD U.S. POSTAGE PAID JEFFERSON CITY, MO Permit No. 210
Protect your investment with the right risk-management tools.
Ag & Business® Loans – Operating Loans – Real Estate Loans – Capital and IntermediateTerm Loans
Managing your business risk depends on having a variety of products that offer the best protection. FCS Financial Ag & Business® provides the expertise you need to make sound decisions.
Risk Management Products – Crop Insurance • Multi-Peril Crop Insurance • Yield Protection (YP) • Revenue Protection (RP) • Revenue Protection with Harvest Price Exclusion (RPE) • Rainfall Index • GRP/GRIP • Crop Hail Insurance – Livestock Insurance • Multi-Peril Crop Insurance • Livestock Risk Protection Insurance (LRP) • Livestock Gross Margin (LGM) – Life Insurance
Before you sign on any dotted lines, visit your local FCS Financial office. We can help you find the exact risk management products that protect your operation and give you peace of mind. Let us help you prepare for the worst-case scenarios, so you can experience the benefits of a secure business future. FCS Financial believes in the strength of rural Missouri, because we built our business here, too. Contact us today to learn more about our risk management products. Please call 1-800-444-3276, visit myfcsfinancial.com or stop by an FCS Financial office, and let us put our experience to work for you. Experts in rural financing since 1916 FCS Financial is an Equal Opportunity Provider. Ag & Business is a registered trademark of FCS Financial, ACA. Current life insurance carriers available at myfcsfinancial.com. *Certain terms and conditions apply to these accounts. Farm Cash Management is a registered trademark of AgriBank, FCB.
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