Partners - Spring 2007 by GreenStone Farm Credit Services

Spring 2007

Editor’s Note

Editor’s Note As the temperatures warm and the grass tur ns greener, we can all take comfort in knowing that spring has arrived. Along with it comes a new planting season for many of our customers…and for all of us, a r efreshing sense of excitement after a long and cold winter. As you get outside to enjoy the many activities that come with spring, we hope you still find the opportunity to enjoy this latest issue of Partners, which offers a feature article on a young entrepreneur, the announcement of our 2006 Cir cle of Excellence staff awards, and a guest column on succession planning. Happy r eading…and as always, your comments and ideas are welcomed. Published by

CONTENTS

SPRING2007

YOUNG, BEGINNING, AND SMALL FARMER FOCUS 9| Turning over a new leaf in the strawberry business

Bill Groenink and Jim Cardinal, age 20 and 21, have partnered up to put in a “stacker system” for strawberry production in Michigan.

IN EVERY ISSUE 2|

CEO Comments

Market Outlook

Director’s Corner

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News Update

COLUMNS 4|

No One’s Getting Any Younger By Dr. David Kohl

Succession Planning By Mike Fassler

CEO Comments

CEO Comments by Jim Schiller

nce again, we enter the spring season-a wonderful time of the year as the start of a new growing season symbolizes a new beginning with new hopes and expectations.

Economic Trends Agriculture is a dynamic industry. Change is continuous causing both opportunities and challenges. To try and predict where we are headed from an economic perspective is difficult, but worthy of a few comments regarding trends. • Michigan’s poor economic climate particularly in the auto industry and manufacturing sectors provides an overall cloud regarding positive economic momentum for the state. Wisconsin does not have the same level of challenge in this area. For Michigan, however, there is concern as high unemployment and poor economic activity outside of agricultur e affect outside income which supports a significant portion of our borrowing customers. From a general assessment, caution is appropriate for our rural Michigan customers with a stable to more positive environment in Wisconsin. • New housing construction and the r eduction in cash-out mortgage financing in the recent past will also bring moderation to economic growth in the overall economy. The overall housing market has moderated fr om rapid value increases with some significant declines near urban manufacturing centers. This also provides a caution for economics in the near term as it is too early to pr edict when we will hit the bottom. Stable and lower tr ending interest rates will help to turn the momentum. • In the agricultural sector, crop farming particularly in program crops looks strong as high corn prices influenced by ethanol look to be a near cer tainty for this production year. Soybean and wheat prices have followed suit. Livestock operators, on the other hand, see incr eased costs as a result. It is difficult to predict where this will settle and at what level crop prices will be sustained, how long the transition to higher protein prices will take, and how well our customers are positioned to make that transition. Specialty cr ops including fruit, vegetables, and greenhouses appear stable with good economic indicators. Some specialty ar eas will be influenced by the economic health of the non-farm sector . As you can see, financial and economic tr ends are mixed. Some signs show very positive momentum and would lead us to believe the economics for agriculture will be strong and profitable at least in the near term. Other indicators might point toward some challenges until non-farm economics impr ove, particularly for the state of Michigan.

As I see it, the trend for agriculture and rural communities is positive and optimistic. Agriculture has made significant improvement in financial management and risk pr otection. Our customers are generally well positioned to cycle thr ough shortterm adversity and are equally positioned to capitalize on additional opportunities that are sure to come as agriculture is more of a source for alternative energy and bio-technology initiatives.

GreenStone’s Role GreenStone, the dominant lender to agriculture, sees its role as helping our clients succeed and being a sour ce of capital and financial services to take advantage of new oppor tunities that are available in a dynamic industry. GreenStone has begun the year 2007 with a continuation of our positive momentum developed in 2006. Loan volume gr owth is strong, and credit quality remains sound. Most importantly, we have a knowledgeable and dedicated staf f to assist in developing financial packages and offering financial services tailored to each individual’s specific needs.

Interest Rates Short-term rates are stable with a slight hint of r eduction as a result of a slowing overall national economy. GreenStone reduced our variable rate .25 percent effective January 1 as a result of sound financial performance, and in line with our objective to be the leading competitor in the agricultural marketplace. Intermediate and long-term rates continue to be flat with some reductions forecasted. So, rates should continue at r easonable levels throughout all of 2007 with some chance for r eduction, particularly in the short-term area.

HORIZONS The HORIZONS Project is now in its “mobilization” stage. We will be contacting you requesting your assistance in getting needed legislative changes to the Farm Cr edit Act in order for us to stay relevant in serving agriculture and rural communities.

Director Elections GreenStone as a cooperative financial organization elects a board of directors from its membership to provide governance including direction and oversight of the organization’s strategies and activities. This year two of our seven dir ector regions are up for election with stockholders electing two dir ectors in each region for a three-year term. The Annual Meeting Information Statement was mailed in early March and contains detailed information regarding the election process. Following the annual meeting scheduled for March 27, mail ballots will be for warded to all voting stockholders. Please be an active member and cast your ballot for the region in which you are located and return it to the association. Quality directors are critical for continued success of this dynamic organization. Your vote is important! Best wishes for a successful planting season. As always, we welcome your comments or questions.

Spring 2007 PARTNERS

Market Outlook

A golden opportunity?

Market Outlook Spring 2007 By Ken Lake

recently attended the Renewable Fuels Association Annual Meeting in Tucson where I, along with some 2,400 other attendees, heard speakers from virtually all segments of government and industry tout the prospects of not only ethanol, but various other forms of r enewable energy, as being an integral part of this country’s long-term answer to unstable foreign oil supplies. Unquestionably, ethanol production, and more importantly for readers here, corn production has been, and will be, the focus of corn traders, users and pr oducers until the 2007 crop is seeded, watered and pollinated. By the time you read this, the much anticipated USDA planting intentions report will be history. We are all expecting significant increases in corn seedings this spring and the size of that increase will dictate price direction from March 30. While trade guesses on corn acr eage increase range from 8 to 12 million additional acres, the Pro Exporter Network, a nationally respected group of Ag Economists, are projecting a mere 8.7 million acre increase. At their recent annual outlook seminar in Kansas City they explained to some 400 attendees their reasoning behind their guess. They also spent quite some time evaluating guesses of other analytical gr oups who all have estimates at the higher end of the range, 11 to 12 million acres. They said that while those guesses could be correct, they are also statically unreliable. That being said, an acreage increase of less than 9 million acr es on March 30 should cause corn values to continue to escalate and exer t additional pressure on corn users’ margins. I talked in the previous issue about what I believe to be the beginning of an Ethanol Plant Pr oject Development "recession", largely due to increased construction cost. Increased construction cost alone will likely not be able to slow Ethanol Plant Project Development. There are plenty of capable Ethanol

PARTNERS Spring 2007

Plant developers in the countr y that will likely be able to manage costs and continue to build plants. The one thing they have no power over is feedstock price and if the corn market gets the signal that the country may run out of supply , it will be the market’s job to price corn so that ethanol pr oduction slows. To that end, the Pro Exporter group projects corn values of over $4.00; and that ethanol pr oduction will eventually expand to 15 billion gallons per year and use over 5 billion bushels of corn, with some idling of ethanol pr oduction capacity by year 2015. They also expect that total corn and soybean acr eage combined is limited to about 160 million acr es. Soybean values will need to rise to a level that will entice additional acr eage in South America as U.S. farmers ar e expected to continue to seed corn at the expense of both soybeans and wheat. Dr. Bill Tierney of John Stewart and Associates predicted that November Soybeans futures would trade $8.00 by April 1, and that the November contract high could come in closer to $9.50 per bushel this year. As I said in the beginning of this piece, the upcoming USDA planting intentions report is probably the most anticipated report in years, and while ther e will be lots of weather and production issues to deal with thr oughout the season, the numbers in this report will set the stage for corn, soybean and wheat values for years to come. Ken Lake is the Origination Ser vices Coordinator for Michigan Agricultural Commodities Inc., Lansing, Michigan, and a licensed commodities br oker registered with the National Futures Association. He writes a regular market update, “MAC Marketline,” which is available to GreenStone FCS customers through GreenStone’s marketing alliance with Michigan Agricultural Commodities Inc. MAC Marketline can be found at www.greenstonefcs.com. The opinions stated herein are not necessarily those of GreenStone FCS.

Farm Management

NO ONE’S

Getting Any Younger

by Dr. David Kohl

his was a challenge identified by the agri-lenders attending the Colorado Graduate School of Banking recently. They further suggested that many of their ag customers are saying, “Don’t let your sons and daughters gr ow up to be farmers.” Well, doesn’t that sound like an old W illie Nelson song? Granted, there are fewer young people taking the dir ect route back to the farm or ranch, but that model may be changing. Anecdotal evidence finds that many young people ar e “boomeranging” back to the farm or ranch after a stint of pr ofessional life in an urban area. Traffic congestion, long hours, and the stress of lifestyle often encourage a second look to rural ar eas. Others find that they can farm or ranch and also be involved in careers in business or agribusiness that have flexible schedules. I personally know of over 20 agri-lenders who operate fairly large farms and ranches and still juggle both ends for a very rewarding lifestyle. Still, some of our youth like the entr epreneurialism of “outside the box” agriculture, like value-added ventures and agrientertainment, which offer much excitement and reward.

Dave’s TOP TEN Reasons to Consider Farming, Ranching, and the Agriculture Industry 1. Minimal competition from your peer age group. 2. The opportunity to implement some of the latest technology breakthroughs in biotechnology and computers to your business model. 3. Desirable work environment including a somewhat flexible schedule, working outdoors, and no traf fic jams. 4. Agricultural businesses can provide a nice environment for raising children to be responsible citizens. 5. The future of farming and ranching involves dealing in finance and marketing, and executing business plans and strategies.

6. Chance to network with other successful farmers and ranchers around the world through conferences and the Internet. 7. Seeing your accomplishments and being able to measure your success from field to feed yard to the financial bottom line. 8. To carry on the family legacy and tradition. 9. Being involved with an industry that will change as much in the next decade as it has in the last century . 10. Providing products that are invaluable to society and the economy: food, fiber and lifestyle.

Dr. David M. Kohl is Pr ofessor Emeritus of Agricultural Finance and Small Business Management and Entr epreneurship in the Department of Agricultural and Applied Economics at Virginia Polytechnic Institute and State University (V irginia Tech), Blacksburg, Virginia. He has conducted more than 3,000 workshops and seminars for agricultural gr oups such as bankers, Farm Cr edit, FmHA, and regulators, as well as producer and agribusiness groups. He has published four books and over 400 ar ticles on financial and business-related topics in journals, extension, and other popular p ublications.

The opinions stated herein are not necessarily those of GreenStone FCS.

Spring 2007 PARTNERS

Guest Column

SUCCESSION PLANNING: TODAY’S LEADERSHIP OPPORTUNITY You read about it in the popular press. You hear about it at seminars. Entire books have been written about it. The baby boom farmer demographics suggest it should be taking place. And some family members cautiously bring it up for discussion. But, succession By Mike Fassler

planning just doesn’t seem to be happening for many farm businesses.

Developing a succession plan for your farm business is perhaps today’s greatest leadership opportunity. The focus of this article is to motivate you to get star ted with your succession plan if you haven’t; to encourage you to continue if you have; to jumpstart the process if you’ve stalled; or to congratulate you if you are finished! And I want to pr ovide you with some practical tips about the succession planning process along the way. Succession planning is the development and implementation of a plan to transfer r esponsibility, operational control, leadership, and ownership of the business fr om one generation to the next. It is logical that since the farm business usually represents 90%+ of a family’s net worth, there ought to be a succession plan to manage the transition of the management

PARTNERS Spring 2007

and ownership of the business from one generation to the next. So what holds a farm business owner back fr om succession planning? For starters, it is a complex pr ocess, both from an emotional and technical standpoint. It is dif ficult due to the varying needs and wants of stakeholders, all competing for the same scarce resources. It often seems easier to just keep things the way they are rather than navigate through the minefield of differences. At the start of the planning process the outcome is uncertain. By taking each step in the succession planning pr ocess, the possible outcomes become clearer and uncertainty is reduced. And with this clarity comes the energy to complete and execute the plan.

Some practical tips I have learned are: • Start with the human side (emotions and responsibility) of the succession and finish with the financial side (ownership transfer). • Involve all stakeholders in the pr ocess at some point. They will be mor e willing to accept the result if they have had some input. • Don’t worry so much about wher e you are in the process but make sure you are moving forward. • Succession planning involves choices. Classify choices as “ideal”, “acceptable”, or “unacceptable”. If you don’t, decision making can become paralyzed and the planning process will stall. • Stay centered up with what is best for the business. This may or may not be what is best for an individual or one of the families. • If the process is stalled, look for the emotional rather than rational reason as to why it stalled. • Listen, learn, and understand. Don’t judge another person’s position. • Use financial information to take some of the emotion out of the decisions that need to be made. There will be a discussion some day about what your legacy is and what it means to the family. Taking today’s leadership opportunity can allow you to have the most positive influence possible on that legacy.

Mike Fassler is Director Consulting Services and a business consultant with Salisbury Management Services, a division of AgStar Financial Services, ACA. Mike helps agricultural producers grow their businesses while keeping the business healthy and the family happy. Mike can be reached at mfassler@salisbury-management.com or at 800.663.5608.

GreenStone FCS Offers Special Financing for Investment in Ethanol Venture GreenStone Farm Credit Services is now of fering a special financing program for local producers wishing to invest in a new ethanol venture. In coordination with Liberty Renewable Fuels, LLC, GreenStone FCS has established financing for those interested in purchasing membership units in the new 110-million gallon per year plant to be built in Gratiot County . GreenStone’s membership unit financing program includes no minimum or maximum loan size, no loan fees, and competitive interest rates for fixed, variable or adjustable rate loan products. GreenStone FCS will finance up to 75% of the investor equity purchase using Liberty Renewable Fuels, LLC, membership units as security. Liberty Renewable Fuels, LLC, membership units must be pledged as collateral. For those customers with financing needs greater than 75%, GreenStone may require additional security. “We look forward to having the opportunity to assist those wishing to invest in this exciting new venture,” said GreenStone FCS Executive Vice President Dave Armstrong. “GreenStone has been–and always will be–committed to serving the financial needs of our local producers, and this program allows us another opportunity to exhibit that commitment.” Financing must be in accordance with and is subject to SEC guidelines, and will be available only after Liberty Renewable Fuels, LLC, receives approval by the SEC to of fer shares to the public. For more information, or to apply for this special financing program, please contact your local GreenStone FCS office at 1-800-444-FARM.

Spring 2007 PARTNERS

Director’s Corner

MEET FRANK ENGLER Your Region V Director

Frank Engler is a fourth generation farmer operating a nearly 200-cow dairy and managing approximately 1,200 acres of corn, soybeans and wheat in Michigan’s Isabella County. In addition, his operation also includes some feeder calves. Frank grew up on the same farm he currently operates and in 1980, he enter ed into a formal partnership with his father after finishing a two-year Ag Tech program at Michigan State University. In the early 1990s, they officially formed a corporation. Frank and his wife, Penny, have four children; daughter Teri, son Frank, daughter Laura, and son Paul. Frank is a 13-year Farm Cr edit Board Member, originally serving on the Board of Farm Credit Services of Michigan’s Heartland. He is currently President of his local chapter of the Michigan Milk Pr oducers Association, as well as serving on the Advisory Board at the district level. Frank also is vice chairman of the Isabella County Soil Conser vation Board, and serves as the Isabella County Farm Bureau State and Local Affairs Chairman.

PARTNERS Spring 2007

What do you enjoy most about being a director of GreenStone FCS? Well, what I’ve really enjoyed most about being a dir ector is the chance to meet many dif ferent people. We’ve made a lot of friends over the years and we’ve kept in contact with many of them…there just are a lot of quality people involved in Farm Credit. The other thing is that thr ough meeting all of these people you are able to learn a great deal about the different enterprises. When you are talking with someone involved in an operation different from yours, you’re able to really educate yourself. Our Board is a very energetic group, and I’ve found the staf f to be very professional as well. So really, it’s all about the people…it’s been an invaluable experience for me.

What would you say is the most important issue facing farmers today? If you would have asked me this question six months ago, I probably would have given you a completely dif ferent answer…but without a doubt, today it’s what is happening with the ethanol market. The higher cor n prices are going to have a greater impact on more industries than we probably really even know right now. Is this a fundamental shift in the price of cor n, or is it simply a kind of flash in the pan?...we pr obably really

“ONE OF OUR STATE’S BIGGEST ADVANTAGES IS THE DIVERSITY WE HAVE IN AGRICULTURE…WE’RE SECOND ONLY TO

CALIFORNIA IN THE NUMBER OF ENTERPRISES.”

won’t know for another year or two. It’s probably going to effect dairy and beef prices; more acres are obviously being shifted to corn; and we potentially could have some storage issues. I wish I had a crystal ball so I could pr edict what’s going to happen…but this change came upon us so fast I doubt anyone would have predicted it. I’ve not seen such a big potential change in agriculture as this could be in a ver y long time. There are certainly other issues out ther e, but this ethanol situation is definitely at the top of ever yone’s mind. It will impact a lot of people. In the diar y business, I go back to what my dad and grandfather used to say…with high priced cor n, usually comes higher priced milk. I don’t know if it’s true, but in the

dairy industry you won’t be able to afford to milk those lower producing cows. I would think that would lead to a decr ease in the amount of milk produced, which will mean the prices should go up. It will be inter esting to see how this all pans out.

How would you describe the value Gr eenStone FCS brings to its customers? Probably one of the biggest advantages of working with GreenStone–and really the reason I began to borrow from Farm Credit–is the knowledge it has of the industr y. You have a lot of players that come into a market and of fer cheap interest rates, but when times get tough–and they invariably always do in agriculture–it’s nice to have a lender and partner like Farm Credit that understands the industr y and the cycles, and will stick with you. Also, with all the farms incr easing in size, I think Gr eenStone has been able to really focus on individual enterprises and r eally develop some expertise in expansions…that’s been a real plus.

The overall economy at least in Michigan is obviously struggling. Do you feel the state can use the agricultural industry to impr ove our economic outlook? One of our state’s biggest advantages is the diversity we have in agriculture…we’re second only to Califor nia in the number of enterprises. We have so many opportunities to of fer added value to our industry, which in my opinion we’r e currently not taking advantage of. I think there’s a tremendous opportunity for more processing of our products here in Michigan. I know a lot of producers in our state that would love to get into some sort of added value for their product in Michigan. I’m a big pr oponent of investment credits for businesses in agricultural enterprise zones to encourage new business and to hopefully help gr ow this economy. You know, with the agricultural diversity we have and the fact that we’re also the number two industr y in the state behind manufacturing, we really have some tremendous opportunities and we need to begin emphasizing what we can of fer. Also, with consumers having more and more say in how we do our business, we as pr oducers really need to get out and become involved in the more non-traditional farm groups such as units of government, chambers of commerce, or other trade groups. It’s really important for us to r each out to the public and tell consumers what agriculture is really about.

Spring 2007 PARTNERS

Young, Beginning, and Small Farmer Focus

TURNING OVER A NEW LEAF IN THE STRAWBERRY BUSINESS...

Young farmers capitalize through innovation! By Dick Lehnert

“WE’LL BE ONE OF THE ONLY PLACES IN

MICHIGAN PICKING FRESH STRAWBERRIES ALL SUMMER.”

PARTNERS Spring 2007

t’s not your ordinary kind of farming. For one thing, it doesn’t take up much space. The investment isn’ t cheap, but the income expectations ar e high. It seems like just the kind of pr oject two young men of enterprising spirit might undertake. The two are Bill Groenink and Jim Cardinal, age 20 and 21 r espectively, friends who went to Coopersville High School together and who now have par tnered up to put in a “stacker system” for strawberry pr oduction in Michigan. It’s located near Ravenna in the west central par t of the state. They intend to grow about 15,000 day-neutral (ever ybearing) strawberry plants and harvest two to three pounds of strawberries per plant thr oughout the summer, after the season for June-bearing strawberries has ended. “We’ll be one of the only places in Michigan picking fr esh strawberries all summer,” Groenink said. “Any number of farm markets will love to of fer Michigan strawberries. There are lots of options on the marketing side, and we think we can get $3 to $4 a pound for them.” You can do the calculations. When Gr eenStone Farm Credit Services Financial Services Officer Joe VanderWerff did, he was convinced about the potential and financed the project. It’s being put together now for the first cr op this summer.

While the brand name of the system is Hydro-Stacker, Groenink plays down the “hydro” part because it’s not truly hydroponic. The plants are not grown in water

“THE FRUIT IS CLEAN, SO THERE’S NO SOURCE OF . SAND IN THE SHORTCAKE” but in a soilless mixture of perlite and vermiculite. All the plants’ nutrients come through a liquid fertigation system. The “stacker” part is what makes it nifty. Plants grow in a stack of 20 styr ofoam pots, four to a layer, five layers high, one plant per pot. Pots are offset layer to layer, so drain holes in one pot trickle liquid into a pot two layers down. The pots and layers all interlock into a single unit that sits on a swivel base. The benefits come with the har vest. The berries never come near soil, so the soil-borne diseases that attack strawberry fruit when rain splashes mud on them are much less a problem. The fruit is clean, so there’s no source of sand in the shortcake. The plants are separated, not growing in a mat, so air movement r educes leaf moisture, canopy humidity and disease. The irrigation water never touches the plants, so that wetness isn’t a source of disease conditions either. The berries color well exposed to the light. But the best benefit is in picking. The berries can be picked standing up, since the plants are about two feet off the ground at the bottom and mor e than four feet off the ground at the top. The picker can swivel the stack and pick standing in one spot. Right now, Bill and Jim plan to do the

South, hot summers end strawberry pr opicking themselves, hiring two or thr ee duction by June. In cooler Michigan, he people. They intend to keep their day expects to pick berries starting June 1 jobs-at least until they can gr ow the and going to mid-October. project bigger. Jim now works as an The berries in this system ar e a oneelectrician in a business owned by his year crop, not perennial. The plants brother, and Bill is a cr op consultant. come from California, where they are He graduated from a two-year program harvested from runners in the fall and at Michigan State University in put into cold storage until it’s time to agribusiness management. plant in April. As to marketing, Bill sees tr emendous The soilless mix in the pots just ser ves potential for pick-your-own. They’re to hold the plants in place. Water and located off the beaten track now, but think these stacked berries are something people would love to visit and pick. They may sell berries at the Fulton Street Market in Grand Rapids. They have a verbal assurance from one farm market that says it “will take everything we grow. We have lots on options on the Standing within the strawberry“stacker” system left to right; co-owner marketing side,” Jim Cardinal, GreenStone Financial Services Officer Joe VanderWerff Bill said. and co-owner Bill Groenink. When the nutrients come in from lines laid over young men started, they bought five the top of the stacks. It takes about a acres of uncleared land. After doing quart of water four times a day, injected some clearing, the next with some 4-41-27 fertilizer, to keep the project was a pole barn to hold the plants happy. fertigation equipment and watering supplies that go with the pr oject. They laid vinyl landscaping groundcover on the 100-by 100-foot space where the stacks will go. Day-neutral strawberries should do well in Michigan, Groenink says. In the

Spring 2007 PARTNERS

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News Update

News Update Introducing Farmers’ Health Cooperative of Wisconsin Farmers’ Health Cooperative provides Wisconsin farm families and agribusinesses the insurance coverage they need for the health care they want, at a price they can afford. You would never buy a piece of equipment that was broken, or hire an employee who could only do half the job. And, you’d most likely think twice about paying a fortune for a service you didn’ t need. Why then, would you continue to pay for expensive health insurance that didn’ t work for you or only did half the job that you needed it to? Until now, you probably felt you had no other choice. That’s no longer the case. Finally, there is a health insurance option created by farmers, for farmers. Through the newly-formed Farmers’ Health Cooperative of Wisconsin, farmers and agribusinesses can have access to health insurance that gives you the coverage you need for the health care you want, at a price you can afford.

The Farmers’ Health Cooperative of Wisconsin is the result of a state initiative spearheaded by the Wisconsin Federation of Cooperatives to apply cooperative principles to health care. Farmers’ Health Cooperative combines years of data and feedback collected from farmers and agribusinesses with the experience of nationally recognized insurance carriers, to design health insurance options that fit the needs of the agricultural industry AND are affordable. Highlights of the comprehensive insurance options provided by Farmers’ Health Cooperative include: • Coverage for work-related injuries • Prescription drug coverage • First dollar preventive care coverage • Stabilized premiums • Choice of doctors from a wide variety of network providers • Access to a 24–hour nurse line As a member of a cooperative, you know belonging to a member-owned, memberdriven organization gives you additional benefits. For example, as a member of the Continued on page 13...

It’s a Toe Tappin’ Good Time! With winter behind us and warm weather ahead, it must be time to start thinking about GreenStone’s customer appreciation events. Customers in Michigan’s Southeast Region–which includes our Adrian, Ann Arbor, Concord, Hillsdale, Howell, Mason and Monroe of fices–will want to mark their calendars for this year’s appreciation event. The celebration, scheduled for Thursday, June 21, will be held at the Stagecoach Stop USA at 7203 U.S. 12 in Onsted. The festivities begin with a BBQ dinner being served from 5:30 to 7:30 p.m., followed by entertainment until 9:00 p.m. Invitations will be mailed in May to those customers in the Southeast Region. For more information, contact your local GreenStone office, or email Andy at intanna35@greenstonefcs.com.

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PARTNERS Spring 2007

Because ... new construction financing can be simple!

We’ve been financing country homes for over 90 years. And the industry experts at GreenStone Farm Credit Services have built on that experience to design a unique, hassle-fr ee construction program. We offer fully contracted and do-it-yourself pr oject financing, with no application fees and fr ee pre-approvals! During construction, we’ll work with you thr ough each step to assure that you are included and well informed. Contact your local GreenStone FCS office today for a friendly, one-on-one project consultation. GreenStone Farm Credit Services . . . Come home to the country!

Call us today for more information.

800-444-3276 • www.greenstonefcs.com

News Update

Farmers’ Health Cooperative, you will have group buying power and access to many of the advantages of group health care purchasing. As a non-profit business, future profits will be invested back into the cooperative and its members. Gone are the days of wishing for af fordable insurance plans that provide you with the coverage you need. The Farmers’ Health Cooperative has found a way to harness the group buying power of Wisconsin farmers and agribusinesses and turn it into health insurance that is created the cooperative way. To learn more about health insurance options through Farmers’ Health Cooperative of Wisconsin, call (800) 539-9370 or visit www.farmers healthcooperative.com.

Michigan Farm Receives Grand Champion Award GreenStone customer Jerry Chapman was presented with the National Grand Champion Piedmontese Cow Trophy at the North American Livestock Show in Louisville, Kentucky in November 2006.

Peninsula Cellars Winery recognized in Wine Report Traverse City, Michigan, vintner and Greenstone customer, David Kroupa’s 2004 Chardonnay made the “Top Most Exciting Wines” list in Tom Stevenson’s new book “The Wine Report: 2007.” His “Peninsula Cellars” Winery is the only U.S. winery outside of California, Washington or Oregon

on the list. The Chardonnay was also ranked fourth in the Top 10 Greatest Quality Wines of the Atlantic Northeast. Congratulations to David on his achievement.

Charlotte Office Prepares to Relocate– Opening scheduled for April16

Chapman operates a feedstock operation for Piedmontese cattle on 250 acres in Eagle, Michigan. He has also won national titles for his grand champion bulls in 2001 and 2002. Congratulations Jerry on behalf of GreenStone FCS.

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PARTNERS Spring 2007

GreenStone Farm Credit Services will be moving it’s Charlotte, Michigan office to 722 W. Lawrence Ave. (In front of the old Felpausch store). The Charlotte office phone number (517-543-1360) and fax number (517-543-3010) remain the same. The GreenStone FCS staff at the Charlotte branch look forward to continuing to serve your financial needs!

News Update

GreenStone FCS Recognizes its Top Performers The results are in…and GreenStone’s Circle of Excellence Award winners have been recognized for their high level of performance this past year. In 2006, GreenStone began its Circle of Excellence Program as a way to r ecognize and reward those lending and financial ser vices staff that were the best of the best within the Association. Various criteria were used for each staff category to rate performance, including loan and revenue growth and new customers. Platinum Awards were presented to the top 10 percent of our entire lending staff. While Gold Awards were given to the next 10 percent of lending staff, as well as the top two performers in each of our financial services areas. Each of the winners, along with the support staff for all Platinum Award recipients, were recognized at the 1st Annual GreenStone FCS Circle of Excellence Awards Banquet on March 9 in Lansing, Michigan. The following GreenStone FCS staff members represent the 2006 Circle of Excellence Platinum and Gold Award winners.

Congratulations to all of the winners of the 2006 Circle of Excellence Awards!

PLATINUM AWARD WINNERS

GOLD AWARD WINNERS

Traditional FSOs • Tom Frisk, Schoolcraft • Mike Rasmussen, DePere • Dave Meyering, Cadillac • Gayle Olson, Appleton • Dennis Nykamp, Schoolcraft

Traditional FSOs • Tony Barcroft, Hastings • Mike Kennedy, Ionia • Scott Welden, Hillsdale • Kevin Bock, Bay City • Bernie Thelen, St. Johns

AgriConsumer FSOs • Kim Cool, Cadillac • Cynthia Cole, Ionia • Melissa Humphrey, St. Johns

AgriConsumer FSOs • Sheryl Smith, Charlotte • Deb Teller, Concord • Mark Buuck, Monroe

Commercial FSO • Troy Click, East Lansing

Commercial FSO • Tom Wilson, DePere Accountants • Mark Koester, Grand Rapids • Lynette Wood, East Lansing Tax Accountants • Nicky Wesoloski, DePere • Barb Martell, Sturgeon Bay Appraisers • Dennis Makula, Adrian • Keith Aeder, Caro Crop Insurance Specialists • Nancy Kalies, DePere • Jessica Godley, St. Johns

Spring 2007 PARTNERS

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Because ... our rate special makesthose other guys green with envy!

That’s right, now through May 31, 2007. . . We’re significantly lowering our rates on all equipment term loans. And when you finance equipment through GreenStone FCS, your options are wide open. So go ahead and pick out that piece of machiner y that you need (in any color you want) and we’ll get you the fair deal you deser ve. Call us today for more information.

800-444-FARM

www.greenstonefcs.com

GREAT RATES AS LOW AS

5.99

ON EQUIPMENT TERM LOANS WHY SETTLE? GET A GREAT RATE AND TAKE ADVANTAGE OF AVAILABLE MANUFACTURER’S CASH INCENTIVES!

*Stated Rate of 5.99% per annum is a fixed rate available on new loan closings through May 31, 2007. The Effective Interest Rate (EIR) is affected by loan fees and required investment in GreenStone FCS. A new 3-year fixed rate term loan for $100,000 with stated rate of 5.99%, maximum stock purchase of $1,000, origination fee of $500, and monthly payments would have an EIR of 6.97%. For a borrower who already owned the required amount of FCS stock, the EIR would be 6.31%. This rate is available only on commercial term loans to our most creditworthy customers. Other fixed rate term loans are available. Some restrictions may apply, and rates are subject to change.

This newsletter is published quarterly for the customers of GreenStone Farm Credit Services. PARTNERS PO Box 22067 Lansing, MI 48909 517-318-2290 jim.nowak@greenstonefcs.com aaron.classens@greenstonefcs.com bill.eva@greenstonefcs.com

1760 Abbey Road East Lansing, MI 48823