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JULY 2007 08/15/07 9:07:24 AM
WILMONT – ADRIAN COOPERATIVE
JULY 2007 NEWSLETTER
As we near the half way point of the growing season, there are still some issues that might have an effect on our crop, besides the moisture problem. Soybeans are still at risk to soybean aphids, haven’t seen much for counts yet. We know that there are aphids in the southeast part of the state. Few things to keep in mind when spraying for aphids, numbers are the first signal. The economic threshold for soybean aphids is 250 aphids per plant. Keep in mind that aphids multiply very quickly, they may not be there on Monday, but they might be on Friday, best advice, check fields often. Second, are my beans far enough along that aphids won’t hurt my yield. As your soybean advances in maturity, plants can take more aphids and after R6, this usually is around the 15th to the 20th of August. Next issue to think about is what spray do I use? There are many types if insecticides to choose from and some companies offer a respray program if theirs does not work, even though they pay for the chemical you still need to pay the application price. In the long run you would be better off choosing a chemical with a history of working each and every time such as Warrior.
As news of the new Farm Bill being written and Rep Collin Peterson having a meeting in Minnesota regarding the farm bill, there may be some changes to keep in mind. The FSA program for low interest loans for on farm storage, Rep Peterson has stated that the money for that program might not be there next year. If you are thinking about getting a bin under this program you may want to move up your plans and put a bin up this year. Now keep in mind the House is taking a position on it, the Senate has not, so there is a possibility that this program may stay.
Bin construction is progressing along well. If you are thinking about a bin we still have time to construct a bin, so please call us if you have any questions.
Effective September 1, 2007 we will no longer be renting out our grain vacs. If interested in purchasing these grain vacs contact Derick or Matt at the Farm Store in Wilmont.
Thanks for your business,
Matt Henning
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News from the desk of Derick
Grain bins this summer have been going up at a brisk pace this year. We were able to get a good jump on getting them started early this spring. Also, we have not been set back by rainy weather this year like we have in previous years. The only real hurdle has been getting the bins shipped in time. The industry the last few years has been having record numbers for bins produced, and this year looks to be another record year for the industry.
Feterl Augers and Demco wagons and carts continue to be in good demand as they are also related to the grain industry. This year Demco has come out with all new graphic on their carts and wagons as well as a few other improvements. If you have any questions or would like more information on any grain handling equipment, feel free to give me a call!
Derick
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We had an employee meeting a couple of weeks ago to inform our employees of various changes that are taking place this year. I told them that they would probably remember this as a year of change, to be more accurate I should have said a year of transitions. I would like to go into a little more detail about a couple of these transitions.
Last summer our Farm Store Manager Ron Hoffman was diagnosed with cancer and determined to win the battle with his disease, fought a valiant fight. Unfortunately the cure for his form of cancer was not yet available to him. As Ron spent more of his time at home and in treatment, our Farm Store employees were learning to take charge and develop their skills to fill the void being left by Ron’s absence. There will never be any single person who will be able to have all of Ron’s knowledge and experiences, and we will miss him and his dedication to our customers and our business. Though they may not have Ron’s knowledge and experiences, we are fortunate to have several employees who are dedicated and over time will develop their own valuable knowledge and will also learn from their own experiences as all of us have had to do. At the Farm Store, Derick Feikema is working mostly with equipment bids, ordering equipment and taking care of parts. Steven Joens is in charge of the shop and handles technical repairs & service. Mark Ruesch is our seed sales specialist, and Matt Henning is in overall charge of Farm Store operations, labor, equipment and agronomy sales. As I look at how everyone has adjusted to their new or added responsibilities, I know Ron would be pleased with the transition that he started a year ago. Ron always tried to provide the best customer service that he could and has instilled that desire in the employees who worked for him. As always our focus is trying to provide the best customer service that we can.
Another transition we will be going through this year is the changes that will take place at 5 Star Cooperative, our fertilizer partnership with Farmers Union of Luverne and Southwest Minnesota Farmers of Luverne. 5 Star was originally created to provide the agronomy needs for all of its owners, unfortunately over the years the owners of 5 Star chose to ignore the bylaws of the partnership they had formed or had joined, and started providing agronomy services of their own in direct competition with the partnership they had formed. The Board of Directors for 5 Star have been fighting with the problem for 20 years or more. With the competitive changes happening in agronomy today some of the partners of 5 Star felt that they wanted to go their own way rather than put all of their agronomy assets into the partnership, and voted to dissolve 5 Star as of its business year end August 31, 2007.
At Wilmont-Adrian Cooperative, our feeling was that we should put all agronomy assets into the partnership, feeling there was more value for our customers by gaining the efficiencies of scale by doing that verses going our separate ways. After deciding to dissolve 5 Star, the partners divided up the assets. Southwest Minnesota Farmers will be receiving their share in cash and regional equities, Farmers Union of Luverne will also receive cash (or inventories) their share of regional equity and the Adrian and Ellsworth fertilizer plants along with some of the equipment. Wilmont-Adrian will also receive cash (or inventories) regional equity and the Lismore fertilizer plant along with some of the equipment. We are also very fortunate in the fact that along with the plant that is in the best repair, we have also hired 5 Star’s manager Dave Lutmer, and Laurie Wieneke 5 Star’s bookkeeper. They will be joining our team in September. Dave will be in charge of agronomy operations for us and Laurie will be working with agronomy bookkeeping. If you are a customer who used the Adrian and Ellsworth fertilizer plants you may be wondering about the wisdom in dissolving 5 Star, we also questioned that but it’s been done. We are looking into an agreement with Farmers Union to have product at Ellsworth and Adrian for our customers and at Lismore for theirs. Don’t know if this will happen or not yet. We will let you know as discussions take place.
After looking at our customer base and how much tonnage goes through each plant we did discover a few things in Ellsworth, the customers who billed their agronomy products through us accounted for about 20% of the volume in Ellsworth though they also accounted for the largest percentage of the customers doing business there. In Adrian the percentage of agronomy products was also small, though we did account for the largest amount of anhydrous sales at that plant. We do know that the Lismore plant is more than capable of taking care of our Ellsworth and Adrian customers needs by delivering the products directly to your farms or having equipment available to pick up at our Adrian and Ellsworth elevators. We will be out to discuss the changes with you and determine what is needed to provide services for the future. Again remember we are dedicated to taking care of our customers needs will develop the means to serve you as efficiently as possible.
Do we believe that there will never be the need to change our agronomy department in the future? The answer is NO! We do believe that we will seek out partnerships and relationships with other companies to provide you with the best service and value as we go into the future.
Other changes that are taking place are a large shift to include more corn acres and less soybean acres this will create a need for more storage and with more corn on corn, more commercial fertilizer will be needed. Some projections show that the corn crop will have to grow both in acres and yield for the next several years to satisfy the need for ethanol. Along with the rest of the agricultural community we are working at plans to build or secure more grain storage to meet the needs. As of the last USDA crop report on June 29, corn acres are at 92.9 million where the traders expected about 90 million acres. Soybeans are at 64.1 million acres, when the traders expected about 68 million acres. Wheat was at 60.5 million acres and the trade expected about 60.3 million acres.
June 1 stocks were also higher than expected with corn at 3.533 billion vs. 3.467 expected, soybeans were at 1.091 vs. 1.076 expected, and wheat was at 456 vs. 422 expected. Wheat will have new crop report out on the 12th of July, this will tell more of the story on wheat and the wet weather that has been slowing harvest. Basis on corn continues to remain firm, while at the same time basis on soybeans has widened all through June and early July, with local basis levels reaching levels of -1.00 under or more. This is the processors way of saying we have all the beans we need and don’t want any more now. However, if you look at the futures carry in the soybean market you will see that the market wants you to hold soybeans till sometime after the first of the year.
The third quarter for Wilmont-Adrian Cooperative ended May 31, at first glance we are excited and have noted that we are in the black with sales volume is at 28 million which is about where we were at for all of last year. The largest increases have been in amount of grain handled on the first 9 months 4.8 million vs. 3.6 million at the same time last year, the prices received for grain are also up over last year. We still have several contracts to fill and deliver before the end of the business year. Seed sales should be about complete for the year and appear to be just about double over last year, it is still too early to look at fertilizer & chemical sales as the season is not over yet. It’s also too early to review equipment sales as most of the billing for large sales items happen late in the business year and early in the next. Sales for May in the Adrian Hardware store were just about double. This could not happen without people who believe in this cooperative and support it.
Thank you,
Russ Crawford
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