TABLE OF CONTENTS April 2014 “Like” us on Facebook: MidKansasCooperative Follow us on Twitter: @midkscoop Read our Blog: www.midkscoop.blogspot.com Watch us on YouTube: www.youtube.com/midkscoop Follow us on Instagram: www.instagram.com/midkscoop
IN THE COMMUNITY Concern for the community is one of the seven principles of the cooperative system. Learn more about MKC’s efforts to keep rural communities viable for the future through its donations and community involvement. ..................4
EDUCATION Input Finance Program Creates Win-Win Situation for Producers ...................5 Haven area farmers, Keith and Shawn Kincaid, like the convenience of the CFA Input Finance program available through MKC.
FEATURE ARTICLE Growing a New Tradition..........................................................................6
Editorial Staff Kerry Watson Director of Communications Nichole Gouldie Communications Specialist
Management Dave Christiansen President and CEO Danny Posch Vice President and CFO Dave Spears Vice President and CMO Erik Lange Director of Southern Area Operations Steve Peterson Director of Northern Area Operations Dave Sell Director of Energy Operations Kerry Watson Director of Communications Brett Myers Director of Human Resources and Development MKC P.O. Box D Moundridge, KS 67107 620-345-6328 www.mkcoop.com Our Vision: MKC will be a highly valued, customer–focused business engaged in profitable relationships with high business ethics and employee satisfaction.
Research indicates more than a third of U.S. farmers and ranchers are 65 years old or older. MKC believes now is the time to help educate and develop the next generation. More than 90 producers, spouses and guests under the age of 40 attended MKC’s inaugural Emerging Producer Program. During the two-day event, attendees heard from industry experts who provided workable solutions affecting agriculture and cutting edge information.
FROM THE FIELD Service You Depend On............................................................................8 After safety, providing excellent customer service is the number one priority for MKC location managers.
Farmers Cooperative Association Members Approve Merger with MKC...........9 Mail Ballots to be Used for Director Elections ............................................9 Changes to MKC’s bylaws approved by the membership in 2012 allow for mail ballots for director elections. The new process will be implemented with this year’s director elections.
STRAIGHT TALK
PRESIDENT’S COLUMN By Dave Christiansen
Maintaining Local Control Making Decisions Where They Matter One of the questions I am often asked when discussing MKC’s growth is the perception a company will give up their existing control when they merge with MKC. The MKC Board of Directors has been very explicit when defining our business philosophy under the umbrella of our tagline, “Shared Growth. Shared Success.” Under this mantra is our strategy of ensuring control of our organization remains firmly within the hands of our producers and as close to the location as possible. We believe executing a local control strategy helps make our organization stronger. It really wasn’t too many years ago when most of the locations that make up MKC today were individual cooperatives standing alone. Not only did the general manager have sole responsibility to manage day-to-day operations as was customary, he also worked with the banker, lawyers, and the insurance provider, handling workman’s compensation, property and casualty, liability and other coverage as needed. The general manager worked with state offices and regulatory agencies as well. Additionally, he would order inventory and line up transportation for grain, agronomy, feed and energy products. Many times the general manager was also marketing all the grain, and performing functions for human resources, payroll, accounts receivable and payable, advertising and donations. Add to these responsibilities capital expenditures, working with contractors, securing bids and preparing all of this information for monthly board meetings and there was little time left to actually have conversations with and take care of employees and customers. It’s no wonder many general managers became burnt out and sought a career change. Allow me to clearly define what local control means, why we believe it’s vital to our success and better for members and employees. We see it as critical that almost every decision impacting customers on a day-to-day basis is made by the location general manager and their team. The best example of local control starts with equipment and personnel decisions. The area managers and senior location managers are responsible for ensuring the equipment and employees in certain geographic areas are being selected and utilized in the most efficient manner. During our annual planning process, each location manager gathers
information from their team and determines what equipment and repairs are needed in order to best serve the customers in their geography. This same process holds true with personnel decisions. Once this part of the process is complete, a plan is presented to the area managers to be used in the budgeting process. The area managers adjust the plan to ensure good asset utilization while keeping it within our overall capital budget. After the plan is reviewed by the chief financial officer and myself, it is presented to the board of directors for final approval. As you may imagine, the board will have several questions which is why the plan is typically presented by the area managers and occasionally by a number of location managers. Many of the questions are actually asked during our annual strategic planning process. By the time the plan reaches the boardroom, it is simply an extension of the items selected to focus on during our strategic planning process. Whether it is on the farm, in our household or at the coop, we all operate under a budget and not all projects get done the year they are presented. Not only is each project prioritized when presented by the location manager, but it is checked again throughout the process to ensure it aligns with our overall strategic plan. This entire process insures we maintain the control of our organization in the hands of the people who serve the customers, regardless of how many locations we ultimately have. Why is this process important to you, the customer? The primary rational behind it is to do all we can to free up the time of the location general manager and team. We’ve discovered the more that can be removed from the location’s list of duties that interferes with their ability to take care of customers on a daily basis, the more they can focus on their producers. It allows the location manager and their team to spend almost all of their time serving you and providing the overall customer experience you deserve. This process provides significant value for the board of directors. They can now focus on the big picture issues that involve our overall strategy and don’t have to be burdened with analyzing what assets will be required at each location. The board can be assured there has been considerable effort given to make certain the assets and personnel Continued on page 10
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IN THE COMMUNITY
Caring for Our Communities By Kerry Watson, Director of Communications
Concern for the community is one of the seven principles of the cooperative system. For MKC, it’s much more. “We believe our donations, participation in community events and the number of hours employees donate back to their communities through volunteerism is what keeps our communities strong,” states Dave Christiansen, President
and CEO for MKC. “It’s about keeping our communities viable for future generations.” Most recently MKC donated to the City of Inman and the McPherson County Sheriff’s Department, assisting with costs to complete the interior of the new Inman Community Building and the purchase of a mobile security device for the sheriff’s department. The donations were matched by Land O’ Lakes Foundation. According to Jim Toews, mayor for Inman, the new building replaces the shelter house built in 1959 as a community project. “We are very appreciative of MKC’s support,” Toews stated. “This contribution will help with the purchase of Nathan Eck, senior location manager at Groveland, presents a donation to tables and chairs and Jim Toews, mayor of Inman. The donation helped offset costs associated with the interior of the new Inman Community Building. other interior finish
work.” The new building will have the capacity to hold 250 people and has already been secured for a number of large events not previously held in Inman. McPherson County Sheriff’s Department Sergeant and SWAT Team Commander Dean Scott was very appreciative of the donation made by MKC to help with the purchase of a mobile surveillance unit. “A device such as this will allow our officers to monitor a high-risk situation from a distance,” he said. “This will be very beneficial to the safety of our officers and the public.” Over the past five years, MKC has donated more than $300,000 to communities throughout central Kansas with the majority of the donations going to programs focused on alleviating hunger, leadership development, ag education and community safety.
MKC Employees Host Annual Food Drive By Kerry Watson, Director of Communications
The statistics for food insecure homes in Kansas are staggering. According to a study released March 31, 2014 by the Kansas Food Bank and Feeding America, the nation’s largest domestic hunger-relief organization, the food budget needed by families struggling with hunger in Kansas each year is an estimated $164,968,840. Throughout the month of April, MKC employees are joining together to help fill the shelves of area food banks through their third annual food drive. “We know supplies for area food banks can be stressed during the summer,” said Adam McDaniel, member of
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the MKC Community Involvement Committee. “Through a collective effort, we can make a meaningful difference for so many families in our area.” Last year, MKC employees collected 12,403 pounds of food and donated $15,000 to nine food banks throughout central Kansas. “Our goal for this year is to collect 15,000 pounds,” McDaniel said. MKC employees invite
the public to join them in their food drive by dropping off non-perishable food items at any MKC location by April 30. Together we can fight hunger in our communities!
EDUCATION
Input Finance Program Creates Win-Win Situation for Producers by Nichole Gouldie, Communications Specialist
As you continue to plan for the coming year, it isn’t too late to enroll in financing through MKC for your input needs. To help producers obtain the financing their operation needs, MKC in conjunction with The Cooperative Finance Association, Inc. (CFA), provide reliable financial products and services to our members for all of their fertilizer, chemical, seed and petroleum needs. “CFA is a valuable tool for any cooperative member,” said Keith Kincaid, co-owner of S&K Partners near Haven. “CFA is convenient, user-friendly and competitive to any other financing program in the industry.” “The CFA program is a very attractive alternative to other financing programs,” said Dave Spears, chief marketing officer for MKC. Through MKC the program offers competitive variable interest rates starting at 2.45 percent. Keith and Shawn Kincaid, co-owners of S&K Partners near Haven, visit with MKC Field Marketer The sign-up period for 2014 crop inputs Willie Swartz about their crop inputs to plan their CFA needs for the year. has started and MKC is currently taking utilization of CFA, location managers to field marketers are applications. The application process includes a credit application and collateral worksheet. “With a maximum loan able to bundle services for our producers for the benefit of both parties to create a win-win situation for all involved,” maturity of 15 months that covers all crops, the CFA proSpears explained. gram is financing through people who are knowledgeable in “Many of our customers tell us our input financing proproduction agriculture,” Spears added. gram is one of the most beneficial risk management tools Kincaid said it is important to plan out your inputs and available through MKC,” Spears said. “All of their needs for work closely with Brent Heizelman, MKC credit manager. financing agronomy, seed and energy can be handled in a “Brent has taken the time to visit our operation and undersingle visit.” stand our needs,” he said. “CFA has become a reliable tool CFA is an agricultural finance cooperative based in for our operation.” Kansas City, MO., providing reliable financial products and With all of the options available for producers to services to the agriculture sector for over 60 years. For the acquire inputs, MKC believes the CFA program helps propast four years, CFA has recognized MKC as their number ducers receive all the benefits, including discounts, associone input finance customer. ated with purchasing products from MKC, whether it is paying for prepaid inputs or their monthly statement. “With the
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Attendees at MKC’s inaugural Emerging Producer Program network amongst their tables. More than 90 agricultural producers, spouses and guests under the age of 40 attended the event.
Growing a New Tradition By Nichole Gouldie, Communications Specialist
There seems to be a need for much more than mobile apps, drones and new seed varieties in the world of agriculture today. Research indicates more than a third of U.S. farmers and ranchers are 65 years old or older. “The numbers quantify the incredible need for educating and developing the next generation of agricultural producers,” said Kent Nichols, MKC agronomy field sales manager. “These times of tremendous opportunity and risk in agriculture make it paramount for farm operations and families to plan for future success.” More than 90 agricultural producers, spouses and guests under the age of 40 traveled to Manhattan in late February for the inaugural MKC Emerging Producer Program. The Emerging Producer Program was established by MKC for the next generation of agricultural producers and cooperative members. During the two-day program, attendees were able to network with each other, presenters and MKC representatives. Presentations were made from industry experts providing workable solutions affecting agriculture and cutting edge information, along with a keynote speaker to entertain and inspire the attendees. Speakers and topics included Brent Gloy with Purdue University on financing relevant to the farming operation. Energetic presenter, Richard Fagerlin, provided an interactive presentation on developing trusted business partners. CoBank’s Daniel Kowalski provided an up-to-date economic outlook and Chuck Conner, National Council for Farmers Cooperative, provided a political update and a message about the importance of the cooperative system. Keynote speaker, Steve Gilliand, used humor to present leadership,
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success and performance in today’s business environment. Jared Oatney grew up on a farm in Ohio and moved to the Partridge area after school. Now 31, Oatney has his own farming operation. He and his wife, Yolanda, have three children. “The opportunity to go a conference like this as a couple was enjoyable,” he said. “I think sometimes in business you forget that behind the day-to-day business there are families that make up the operation. For me, the program was an opportunity to take a break from the business side, sit down with other producers and talk business and life in general.” Through instant feedback using an anonymous polling device, attendees and MKC learned more about the group. Nearly 50 percent of attendees said they chose a career in farming and ranching because it was their heritage and they were continuing what their family started. Eighty-four percent of the producers said they come from a family with generations of farmers, with 16 percent being the first generation on the farm. Emerging Producer Program attendee Sara Hasty, along with her father, Jim Graber, operate a diversified grain operation in Harvey County. After graduating from college in 2011, Hasty chose to return to the family farming operation. “Growing up on the farm I developed a real passion for it. As I have seen farming involve and become a business, I felt my skills were important to the operation,” Hasty commented. “I enjoy being outside and in the tractor, but I really enjoy analyzing the financial and production side of the operation.” A recent newlywed, Hasty and her husband enjoyed the motivation and new outlook the Emerging Producer Program provided for their operation. Hasty’s husband, Will, also works part-time on the operation. “The program
solely for young producers. “I think it is really great to get was a great opportunity for us to meet other young producmore people involved in our cooperative,” Hasty said. “It ers,” she said. “I met many producers who were from the truly gave you a look at the future of MKC and agriculture same area as I farm but I had never met them. It is rewardin our area.” ing to have new relationships with people who share the Eichman said even though this program was geared same livelihood that you do.” toward young producers, it provides value to the entire Jamison Eichman’s agricultural ambitions started at a cooperative. “If we can get young people off to the right young age working alongside his family. Eichman, now 23 start, keep them informed and up to and a recent graduate from date, I see a lot of value for the coopKansas State University, has his “The numbers quantify the own row-crop and hay operaincredible need for educating and erative.” Nearly half of the participants tion near Wamego and has a developing the next generation thought of a trusted business partner goal to start his own cow-calf of agricultural producers. These when they heard the word cooperative. operation. “I was eager to attend the times of tremendous opportunity When choosing who to do business with, 80 percent of the emerging proprogram to gain knowledge and and risk in agriculture make it ducer group said relationship with a network with other young properson of contact is most important ducers,” Eichman said. “There paramount for farm operations and nearly 60 percent said the key facwere many great speakers with and families to plan for future tor that sets them apart is trust. great topics to cover. The abilisuccess.” Nearly 70 percent of attendees at ty to hear a keynote speaker Kent Nichols the inaugural Emerging Producer prowho was inspirational and lightMKC agronomy field gram said they will return because of hearted was encouraging. It provided some sales manager knowledge learned. “Some of the best insight that I don’t hear often enough in my advice I have heard about farming came from Brent Gloy at daily routine on the farm.” the program,” Hasty said. “He said to find something you Change was a common theme throughout many of the are really good at to enhance your operation but something expert presentations. When asked about change through you can also use to help other operations and supplement the surveying, 78 percent of attendees thought change was your income. I am sure I wasn’t the only producer who good but they usually need to warm up to it first. Thinking walked away thinking about of their operation, nearly 50 percent of attendees said they Brent’s advice.” would integrate more technology into the operation than Nichols truly believes the previous generation, followed by increased efficiency. the program was a success Hasty was in the majority when she said one of her for young producers and biggest concerns about the future of her operation was the their guests. Through this importance of crop insurance. Sixty-four percent of the proprogram, Nichols said MKC ducers felt crop insurance was most important to the future wants to continue to help of their business. Capital and labor were the biggest obstaproducers be more successcles hindering growth of attendees’ operations. ful in their farm and ranch The top three choices for biggest concerns about the business. future of agriculture for the young producers was lack of Nichols commented an understanding of agriculture by consumers, increased govoverwhelming 100 percent ernment regulation and shrinking margins between input of the attendees said they costs and commodity prices. would attend next year. “If Hasty appreciated Gloy’s outlook on the future of agrithat doesn’t make you excitculture. Gloy, a farmer himself in Nebraska, gave an optied about the future of the mistic outlook on the future, Hasty said. Emerging Producer Program, Hasty said, “From who and what I saw at the Emerging Instant feedback to survey questions MKC and agriculture, I am Producer Program, MKC and the agricultural industry have was provided as attendees answered not sure what does,” a lot to look forward to.” questions using an anonymous polling he said. This was the first program of its kind hosted by MKC device.
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FROM THE FIELD
Service You Depend On by Nichole Gouldie, Communications Specialist
All businesses, regardless of type, have one primary and common goal -to serve and satisfy their customers. Satisfied customers are the number one indicator of business success. Likewise, a cooperative has one compelling purpose -- to meet the needs of its members and potential members. Without a focus on serving members and customers, why should a cooperative exist? “After safety, our number one priority at MKC is customer service,” said Jeff Jones, senior location manager at Haven. “No matter the size of the operation, each producer is important to our daily operations and deserves the same level of customer service as anyone.” Cheney area farmer Tarry Zerger is willing to put some miles on the truck to use the services at MKC, although he notes most times his services are delivered to his home when needed. “You can’t beat the customer service,” he said. “My location’s knowledge and helpful attitude is always appreciated.” Zerger, a cattleman, row-crop and wheat grower, depends on the agronomy and energy services at MKC’s Haven and Castleton locations, as well as utilizing the CFA Input Finance Program and working with TMA for grain marketing. Zerger commented he isn’t the farmer in the area with the most acres but the employees at his local MKC location always take the time to go out of their way to help him. “We take a proactive approach in contacting our customers regarding future applications and services,” Jones said. Jones added Agronomy Manager Perry Stussy has led this charge at the Haven location with unbelievable relationships with local producers. “Perry is dedicated to taking a personal interest in his cus-
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tomers and works hard at meeting their needs, giving them proper expectations of what they can expect regarding timing and completion of services. He has lead by example for other employees at our location.” Often Zerger is sitting in the tractor thinking about next year when he gives his MKC location a call to get advice from the employees. “I also receive several calls from the local employees to plan what inputs and services are needed next for my operation,” he said. With a full-time career off the farm, Dickson County farmer Brian Whitehair relies on reliable, timely service and expertise. “With an off-the-farm job limiting the time I have available to spend in the field, when I am ready to go I need to be sure I can rely on a business’s customer service.” Sense of urgency is critical when providing great customer service. “The growers, at times, don’t expect us to get to them in such a timely manner,” Jones said. “We look at scheduling and work hard to get the work orders done while in a specific geographic region.”
“It is important to me to not ask for anything that isn’t unreasonable from my MKC location,” Zerger said. “But they work to go above and beyond to meet my expectations.” There was one instance last Fall when Zerger’s landlord had lined up a fertilizer purchase from a competitor. “It was a Saturday morning, and when I gave the other business a call to let them know I was on my way, they said they were out,” Zerger stated. “I tried my luck at calling MKC on a Saturday. The Haven location was able to get me set up and keep me in the field on that day.” Whitehair commented the relationship he has with his local MKC employees is what keeps him coming back. “They are willing to work with my plan to do what is best for my operation,” he said. Jones and other MKC location managers lead their employees to stay positive at all times, set proper expectations and deliver on them to meet the needs of producers. Jones said, “We have to do what needs to be done in the moment for the customer.”
Jeff Jones, senior location manager at Haven, and Cheney area farmer, Tarry Zerger, discuss Zerger’s future needs for application and services
Farmers Cooperative Association Members Approve Merger with MKC By Kerry Watson, Director of Communications
A large group of members of Farmers Cooperative Association participated in their co-op’s governance, approving a merger with MKC with 91 percent of the votes.
In a special meeting on Thursday, March 6, the membership of Farmers Cooperative Association approved a merger with MKC in an overwhelming 91 percent vote of approval. The merger will take effect June 1, 2014. Citing a need to grow to stay rele-
vant in the industry, the board of directors for Farmers Cooperative started looking into merging with another cooperative almost two years ago. “We felt MKC was the best fit for our members,” stated Hal Mayer, chairman of Farmers Cooperative Board of
Directors. “We believe the 91 percent approval rating by the members indicates they want this too.” Based in Manhattan, Farmers Cooperative Association has locations in Alta Vista, Manhattan, Onaga and Westmoreland. Its services include grain, feed, agronomy and fuel for more than 2,000 members and patrons. MKC’s newly expanded territory will have 41 locations in 14 counties. CJ Blew, Chairman of MKC’s Board of Directors, commented the merger will help to strengthen the cooperative system. “We are excited about the opportunity the board, management and membership of Farmers Cooperative Association has given MKC,” stated Blew. “One thing I’m certain of is we will be better together.”
Mail Ballots to be Used for Director Elections By Kerry Watson, Director of Communications
Changes to MKC’s bylaws approved by membership in 2012 will allow members to cast their vote for director elections either by mail or in person at the annual stockholders’ meeting scheduled for Thursday, July 24, at the Bicentennial Center in Salina. “This change will allow for more member access to the nomination and voting process,” stated David Mills, MKC Board of Director secretary. The ability to cast votes by mail has resulted in a change to the method in which director candidates can be nominated. Members may add their own or another person’s name to the ballot by petitioning Jason Gaeddert, chairman of the MKC Nominating Committee. The petition will require the signatures of 20 eligible voting members of MKC and must be submit-
ted by June 13. The nominating committee will verify the eligibility and willingness to serve of the candidates petitioned for the ballot. “Petitioners to the ballot must also declare which position they are seeking, either by district or at large,” Mills said. An official notice of the annual stockholders’ meeting will precede the meeting and will include information about each candidate. A ballot for members to cast their vote will also be included with the official notice and can be returned by mail by June 13 or brought to the meeting. The ballots will be counted by appointed tellers at the meeting and the results announced that evening. This year’s meeting will feature guest speaker, Bruce Vincent, a third generation logger from Libby,
Montana. Vincent speaks throughout the United States and the world, has testified on resource issues before Congress and has appeared on several news programs such as “60 Minutes”. He has been named Timberman of the Year in Montana, received the Agri-Women’s 2007 Veritas Award, and in 2004 received the inaugural Presidential Preserve America Award from President Bush.
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Making Your Job Easier By Devin Schierling, TMA Grain Marketing Manager
The volume of information available to producers today can be overwhelming. The goal at TMA is to be the conduit of information for our customers, sharing it in as many ways possible, and to provide the tools that make doing business with us easy. TMA’s Farm Margin Report is one example of how information is shared. Focused on farm profitability rather than just price, the report is released weekly through TMA’s social media platforms including YouTube, Facebook, Twitter and email. If social media isn’t your “cup of tea,” different types of information can
Maintaining Local Control (continued from page 3) requested have been driven from the location level and align with the strategic plan they have authorized. This truly assists our location general managers and their teams in being focused entirely on our producers. When planning, many companies focus on their competition to design their business strategy. At MKC, we’re proud to focus on you and your needs not only today, but in the future to help you be successful. We may never fully overcome the perception by some people that control in our organization is done with minimal location input and in a vacuum. We may never fully eliminate the concern that all decisions will be made in a distant office for an organization considering a merger with MKC. All we can do is make certain you know what the real story is and continue with our efforts dedicated to keeping the majority of decisions affecting you daily as close to you as possible.
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be pushed to you via your cell phone, including a daily phone call with a midmarket update on grain markets. In addition, we offer a text messaging service to keep customers updated on market moves three times a day. Our mobile website (m.tmagrain.com) provides specific market information. Once the producer has the information necessary to make a decision, it’s important to have the tools available to execute your farm’s plan. TMA allows producers to create offer contracts when it fits into their schedule. Whether it’s from the comfort of their home or the seat of their tractor, this tool allows the producer to do business when it works for them. Another service we provide our customers is
the ability to have grain checks automatically deposited into your bank account through the Automated Clearing House (ACH) program. ACH allows you to gain access to your money in a timelier fashion and avoid any risk of checks getting lost in the mail. Ease of doing business is just a part of the process to provide exceptional customer experience. For more information about any of these services, visit with a TMA representative.