STRONG FOUNDATION. STRONG FUTURE.

PRESIDENT’S COLUMN BY BRAD STEDMAN, MKC PRESIDENT AND CEO

It is hard to believe that nearly nine months have passed since I started my first official day with MKC. In the very beginning, I shared with the Board of Directors my 100-day plan, which included customer meetings, location visits, supplier meetings and other grand plans to introduce myself to the organization and our member-owners. Little did I know this timing would nearly perfectly coincide with the upswing of COVID-19. We immediately entered into a world of virtual meetings and video calls, where we got to see the living rooms, basements and kitchen tables of our employees and supply partners. So much for that 100-day plan!

As I’ve mentioned to many of you, in the time that has passed since, I’ve felt like Peyton Manning standing under his center yelling “Omaha” to anyone that would listen! I appreciate how well prepared your cooperative was to make this change and demonstrate adaptability in the face of something none of us anticipated. I am confident this adaptability came through the strength of the cooperative’s strong foundation.

It is often said the strength of a building lies in its foundation. A well-built foundation provides the structure’s stability from the ground and keeps the building standing against nature’s forces. Likewise, laying a strong foundation of strategy, systems and leadership are vital for a business to flourish.

Like everyone else, we weren’t immune to the challenges and complexities that presented themselves so far in 2020, but the foundation built in years past was strong. “Strong Foundation. Strong Future.” is a powerful reminder of why the cooperative demonstrates continual improvement for our memberowners by investing in resources, talent, technology and assets.

One definition of strong is the ability to withstand great force or pressure. The strong foundation of MKC has provided a base for the cooperative to remain relevant in the good times and in times when the economic environment in production agriculture is not as promising. Our past investments have prepared the cooperative for times like these and have propelled our company forward. We will continue to invest in areas that will bring value to our member-owners today and for generations to come.

The 2020 fiscal year was record-breaking for MKC in terms of volumes in our core business areas of grain, agronomy, energy and feed. Our financial performance was strong as well, with total net earnings just short of $10 million. Our Board of Directors and leadership continue to discuss and make decisions about striking the right balance between returning those earnings to our members through patronage and reinvesting in resources and assets to continue to ensure we are serving producers’ needs well into the future. We thank you for your continued business and support.

Over the past couple of years, we have had many opportunities to grow and make additional investments on behalf of our owners for the future. We welcomed a merger with Plains Equity Exchange and Cooperative Union members in June of 2019. We worked together with their employees to integrate people, processes and assets over a few months. This additional geographic footprint spreads our services over a larger area and allows us to create synergies in our business, particularly in grain. This is an example of how our growth enables us to develop talent and create career path opportunities for our people. As we grow, this kind of example is important to attract and retain top talent across our region.

We continue to find new markets in which to deliver grain, both foreign and domestic. The terminal in Canton has shipped out 326 trains since December 2014 and the Sumner County Terminal has shipped out 59 trains since July 2017. These investments, as well as new investments like the additional grain storage at Moundridge in 2020, allow MKC to improve speed and space for local harvest times and create additional value for our members as we seek to market your grain around the country and globe.

We have invested heavily in technology with the end goal in mind of making it easy to do business with MKC. With each investment in technology, we ask questions like “How will this help our owners?” and “Does this make doing business with MKC easier for our customers?” We will continue to get feedback from you to understand what future needs you have and then work with strategic partners to make decisions about bringing those investments to life. As the world and business continue to change at a rapid pace, please know that we are always looking for ways to help keep our members on the cutting edge of technologies to enhance their operations.

We would be remiss to not reflect on the acquisition of Mid-West Fertilizer. In October 2019, Mid-West Fertilizer Inc. and MKC entered into a letter of intent for MKC to acquire Mid-West Fertilizer, a full-service agricultural retailer headquartered in Paola, Kansas. In May 2020, July 23, 2020. Due to COVID-19, the business meeting was conducted virtually and included reports of management and officers, the presentation of the audit report and the announcement of the election of officers.

Allan Wegner, MKC board chairman, called the meeting to order at 10:00 a.m. and recognized a quorum, or 20 member-owners, was present. MKC Board Member David Mills presented the proof of due notice of the meeting as well as the July 16, 2019, the acquisition was finalized and announced as a whollyowned subsidiary of MKC. This acquisition strengthens our position in the marketplace and will allow us to expand our services to create additional value for our owners and customers. We see the growth of our footprint as a key part of our strategy. Mid-West Fertilizer is a strong ag retail organization with a great team. The synergies gained through this acquisition will allow both companies to continue to achieve greater success.

As we progress and build on the past successes of MKC, we want to call out all of the hard work, dedication and enthusiastic mindsets our employees bring to work each day. They truly show up with our customers and owners in mind in all they do. Our keys to success are four simple terms: safety, courtesy, image and innovation. As simple as these words are, these internal and external facing objectives drive our business. We want to be a place where others want to work and that provides employees an opportunity to grow in their career. We also strive to be a business you want to do business with by maintaining a professional image and providing the tools you need in your operation. All the while, we make certain safety is at the forefront of all we do for our employees and our members.

These are certainly interesting times for not only your cooperative, but also for all aspects of our personal and business lives.

Thank you to our member-owners and customers for their continued business and support. From the foundation of the cooperative and into our future, our success is directly tied to our member-owners and our commitment is never to forget that.