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As always, hindsight is 2020. Currently we are at the level of sales we saw in 2008 to 2010 for 2WD 100+hp tractors as indicated by the chart below.

So is that a bad place to be? Well to be fair, it has been pretty painful for the industry in the short term. It is difficult to gear up production to meet the demands of 2012 – 2014 only to have the faucet turned down very dramatically just a year ago. Adjusting to the volatility of market demands in the short term is never an easy thing. It affects factories’ output, employment, and the local economies where factories are located. As usual, what happens in manufacturing has

We have now been in this downturn of equipment sales for a year. AEM has

just reported on the tractor and combine sales for August. Two wheel drive 100hp+ tractors are down 20% for the year. Four wheel drive tractors are down 44.2% and self-propelled combines are down 39.3%.

Oh my. Or OMG, depending on your generation. These are really big percentage drops in the number of units sold from last year. Fortunately the small horse power tractors are still doing well. Also equipment going into the livestock and dairy segment like forage harvesters and balers have been doing pretty well for most of the year. But overall, how bad is it?

“ When we look at a 40-year history, it doesn’t look like we are in too bad of a spot, and the trends still look very promising.”

continued, page 2

So how bad is it?

I N D U S T R Y I N S I G H T S F O R T H E A G E X E C U T I V E | S E P T E M B E R 2 0 1 5

September Features:

Questions/comments : [email protected]

n Market IntelligenceAg equipment industry trends ....... page 6

U.S. Ag equipment export trends and analysis ................................. page 7

AEM ag flash equipment sales data, sales trends and analysis ............. page 8

Quarterly North America Ag equipment industry trends report ................... page 9

Commodities ............................... page 10

n Equipment Sales DownturnSo how bad is it? .....................pages 1-2

n Technical InnovationsAEF ISOBUS database use increasing ................................... page 15

n LeadershipYou have to learn to say no ......... page 12

n Advocacy and LegislationIowa State Fair - nothing compares ......................... page 3

CLAAS of America rallies support for pro-manufacturing policies ..... page 3

AEM priority Ag issues ...............page 4-5

n StandardsTerminology for combines and grain harvesting .................. page 13

n Global BusinessLatin America agricultural machinery exports down ............. page 11

n Manufacturer AlertEPA star rating impact on sprayer manufacturers ............... page 14

UPDATED CHART TO COME

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2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Historical 100+hp 2WD Tractor sales In USJan - Aug

2AEM Ag Executive Advisor | Industry Insights for the Ag Executive

Equipment Sales Downturncontinued from page 1

So how bad is it?

Charlie O’Brien Senior Vice-President and AEM Ag Sector Lead [email protected]

in some cases where sales were so good with new equipment flying out the door that it was creating a glut of used inventories sitting on dealers’ lots. The large used inventories have also hurt new sales as dealers focus on selling the used

inventory through the secondary markets. These inventory levels are starting to come down, but they are still not where we would like to see them.

So the question is whether or not the current level is a bad place to be. And more importantly, what will the future hold? When we look at a 40-year history, it doesn’t look

like we are in too bad of a spot, and the trends still look very promising. The sales for 100+ 2 wheel drive tractor trends as indicated in the chart are certainly going north. Demand for technologies designed to meet the challenges we have before us - limited land for agricultural expansion, scarcity of water, and the growing population – will continue to escalate. We will weather this short term dip. Ultimately innovation – new equipment featuring new technologies needed on the farm – will lead the way. n

For more information or to register, go to www.agrievolution.com or contact Anita Sennett at [email protected].

a trickle down affect to many other areas of the economy.

Of course the downturn was spurred by the change in course of corn and soybean prices, but has also been compounded by the bouncing around of the reauthorization of Section 179 last year and now again this year. And we were our own worst enemies

[email protected]


Advocacy and Legislation

Iowa State Fair – nothing comparesSix days. Seven presidential candidates.

Two senators. Two members of Congress. And thousands of everyday Iowans.

All of them stopped by AEM’s I Make America (IMA) booth at the Iowa State Fair to demonstrate their support for manufacturing in our heartland.

IMA’s trip to the Iowa State Fair from August 13-18 in Des Moines was a smashing success that helped launch our campaign’s 2016 efforts to put manufacturing issues at the center of next year’s election.

Visitors to our booth included the last two winners of the Iowa caucuses, former Arkansas Gov. Mike Huckabee (2008) and former Pennsylvania Sen. Rick Santorum (2012), Dr. Ben Carson, a retired neurosurgeon who ranks second among Republicans’ choice for a presidential nominee, Wisconsin Gov. Scott Walker, former Hewlett-Packard CEO Carly Fiorina, Ohio Gov. John Kasich and former Texas Gov. Rick Perry.

Just as significantly, the IMA campaign enjoyed thousands of new supporters in

the Hawkeye State after earning the sign-ups at the event. IMA supporters help to push grassroots efforts that benefit the manufacturing industry. Check out I Make America’s Facebook page and Twitter

(@IMakeAmerica) to see the highlights. To learn more about IMA, go to imakeamerica.com or contact AEM Public Affairs Coordinator Trisha Schoof at [email protected]. n

CLAAS of America rallies support for pro-manufacturing policiesCLAAS of America and AEM Vice Chair

Leif Magnusson welcomed Nebraska officials and AEM staff to his company’s facilities in Omaha, Nebraska, on July 17 for an I Make America sign-up event. I Make America supporters - roughly 60,000 of them - lead the way in AEM’s grassroots efforts to reach our legislators on the importance of passing pro-manufacturing policies.

Nebraska Department of Agriculture Director Greg Ibach and Brenda Hicks-Sorensen, Nebraska’s newly-minted director of economic development, joined CLAAS

leadership and AEM leaders for a discussion on economic and advocacy issues involved in manufacturing before taking a factory tour.

“We’re here because of the assault we’ve felt for many years on manufacturing in the U.S.,” AEM President Dennis Slater told the Omaha World-Herald in an interview. “It’s people thinking that manufacturing in the U.S. is in retreat, when the reality is there are companies throughout this country, especially in our industry, that are

market leaders and world leaders.”

For more on I Make America check out the website at www.imakeamerica.com or contact AEM’s Trisha Schoof at [email protected]. n

AEM President Dennis Slater speaks to CLAAS of America employees during an I Make America event on July 17 in Omaha, Nebraska.

www.imakeamerica.com

www.imakeamerica.com



AEM priority Ag issues

Section 179 bonus depreciation Background:Section 179 bonus depreciation has become a critical facet of the equipment industry, playing a key role in customers’ purchasing decisions. Unfortunately, this important policy has been held hostage to annual, last minute extensions.

Current status:The House of Representatives has passed legislation to make bonus depreciation permanent, but the Senate is not expected to take up the bill. An extension of bonus depreciation is tied to the broader fate of the “tax extenders” package which the general consensus believes will be signed into law near the end of the year.

AEM’s position:AEM believes Section 179 bonus depreciation should be made permanent and is pushing congress to pass an extension as soon as possible to maximize the positive economic impact of this common sense policy.

Renewable fuels standard (RFS)Background:The RFS has been a tremendous success in driving the creation of a domestic ethanol industry. In recent years, the Environmental Protection Agency (EPA) has signaled its intention to pull back from the RFS due to the oil industry’s refusal to install fueling infrastructure, moving us past the 10% “blend wall.”

Current status:EPA’s most recent blend level proposal, which is for 2014, 2015 and 2016, contains the same ill-conceived methodology used to determine levels based on the fueling infrastructure’s ability to deliver. EPA’s decision has driven away billions of dollars in investment capital for next generation ethanol plants and is expected to reduce the demand for corn by 1.5 billion bushels in 2015 and 2016. As members of the Fuels America coalition, AEM is working to change EPA’s course and protect the statute in congress.

AEM’s position:AEM believes the RFS is the cornerstone of American renewable energy policies and if tampered with, either administratively or legislatively, can severely stunt the growth of the advanced biofuels sector, which promises new markets for equipment.

Fugitive dust and bee healthBackground:Mass bee death incidents in Europe and North America surrounding the planting of treated corn seed have drawn increased attention to the use of pneumatic planting equipment. This in turn has caused the U.S. and Canadian governments to consider increased regulation of the use of this type of planting equipment.

Current status:Equipment manufacturers recently finalized an ISO standard to control fugitive dust from planters. AEM is working with EPA and other stakeholders to spread the word of our industry’s voluntary efforts to address this issue.

AEM’s position:AEM takes pollinator health seriously and is helping to coordinate several industry initiatives to improve the environmental stewardship of our products in relation to bee health.

Agricultural equipment lighting and marking standardsBackground:AEM successfully attached legislation to the last highway bill that harmonized lighting and marking standards for agriculture equipment across all states by having the Department of Transportation (DoT) refer to the consensus standard developed by the American Society of Agricultural and Biological Engineers (ASABE).

Current status:The U.S. DoT has delayed its release of their proposed draft of the rule several times. It is now set for early 2016. AEM is working with congressional champions to pressure the agency to quicken their progress. Once released, AEM will work with our member companies to ensure the agency has taken the proper approach and coordinate any outreach to DoT to address any issues with the draft rule.

AEM’s position:AEM believes adopting the ASABE lighting and marking standard will reduce regulatory confusion for manufacturers, dealers, law enforcement and farmers and ranchers while making our rural roads safer.



Spray driftBackground:EPA has launched a Drift Reduction Technology (DRT) Registry. Companies may now submit their spray drift reduction technologies for a rating from EPA of 1 to 4 stars. The more stars a technology is assigned, the fewer use restrictions a farmer/rancher will have when applying product.

Current status: At this year’s Farm Progress Show, AEM arranged for representatives from EPA to tour member company sprayer exhibits and address a group of sprayer manufactures. The purpose of these meetings was to educate member companies about the program and the agency on the considerable efforts the agricultural equipment industry takes to address spray drift without government involvement.

AEM’s position:AEM wants to ensure that any government program encouraging the adoption of spray drift technology is done as fairly as possible, without intentionally or unintentionally discriminating against any brand(s). AEM also believes the DRT is too narrowly focused, not recognizing the full scope of drift reduction methods offered by precision ag.

Agricultural equipment on road regulationsBackground:AEM, along with the Farm Equipment Manufacturers Association (FEMA) and our members, worked closely with legislators on a bill approved this year by the Wisconsin Legislature that updates its requirements for Implements of Husbandry on local roads. The new law establishes new permit requirements but did not put additional restriction on height, length and weight (actually increased the acceptable weight by 15%).

Current status:AEM and the industry is working with the Wisconsin DoT and bill sponsors to monitor and understand the implementation of this new law. AEM and FEMA are also undertaking an initiative to understand research gaps and develop standards for on road use of agriculture equipment.

AEM’s position:AEM supports the safe and efficient movement of equipment on public roads and is committed to work with our customers and regulators to enhance safety and maintain our economic productivity and competitiveness.

Rural wireless broadband Background:In the next 100 years, we expect the data revolution in production agriculture will result in more productivity gains than mechanization caused in the last 100 years. That is why much of today’s equipment comes with a cellphone embedded. However, this free flow of information on the farm and ranch can only occur if the modem has a signal.

Current status:Little attention is being paid by regulators and lawmakers to address this issue. The funds that are directed toward increased coverage in rural areas through the American Mobility Fund, a sub set of the Universal Service Fund, are in danger of being cut in this hostile budget environment. AEM is leading a coalition of commodity groups and equipment manufacturers to educate key decision-makers on the importance of rural connectivity with an eye toward the eventual rewrite of the 1996 Telecommunications Act where we hope to create a major initiative to address this matter.

AEM’s position:AEM believes expanding the coverage of rural wireless broadband is a critical step toward fully realizing the potential of precision agriculture. It is in the interest of the entire nation that resources are directed to its deployment in rural areas. These are the lands that supply the food, fiber and energy our cities need to survive.


Ag equipment industry trendsOur special report in

this edition features data from our newly revised Quarterly North American Agricultural Equipment Industry Trends survey. As a first step towards minimizing the amount of questions and increasing the capability to understand what part of the boom-bust cycle we are in, we added some key questions.

We asked for our survey participants’ perception on the market for their three main products. The outlook seems to move mostly sideways. Larger equipment such as harvesting continues to be down. Tractors are expected to be up slightly, most likely driven by smaller HP models. Interestingly, livestock equipment is expected to be down slightly, due primarily to the dip in milk prices. Components and attachments seem to be roughly in line. As a caveat, while we enjoy some optimism in this down

and inventories get used - the backlog seems more stable within the whole goods segment. This hints at a faster adjustment to the current situation. Next quarter, we would expect the backlog for components/attachment manufacturers to become more stable.

For more information on this survey, please email Benjamin Duyck, AEM’s market intelligence director, at [email protected]. n

SPECIAL REPORT

Market Intelligence

Equipment Types Ag Wholegoods Components/AttachmentsHarvesting equipment 1%-5% 1%-5%Irrigation & sprayers Stable 6%-10%Lawn and Garden 1%-5% 6%-10%Livestock equipment 1%-5% 6%-10%Loaders / material handlers 6%-10% 1%-5%Soil working, seeding, fertilizing, plant prot. Stable 1%-5%Tractors 1%-5% 1%-5%Trailers / transportation equipment 10%-15% 1%-5%Components 1%-5%Other 1%-5%

Next 12 months (as of Q2 2015)

market, these are the opinions of our survey participants.

A second question that was added was meant to expand upon our demand question, and shed some more light on the new orders, production and existing backlog. For whole goods and component/attachment manufacturers, production and new orders have mostly fallen in Q2 2015, compared to last year. While the work backlog continues to fall - a natural result of a market slowdown as production drops

Source, Market Intelligence – North American Ag Equipment Industry Trends report.


U.S. Ag equipment export trends and analysis

Exports of U.S.-made agricultural equipment for Q2 2015 dropped

15.1 percent compared to Q2 2014, for a total $2.2 billion shipped to global markets. As opposed to last quarter, several regions recorded growth, though the more important regions such as North America, Europe and South America continued their year-over-year declines.

Imports of U.S.-made agricultural equipment also declined in Q2 2015 compared to the previous year, at a total of 20.42%. We did see some growth in imports from Asia and Africa. Overall, exports continue to decline more than imports, indicating a shift in the trade balance for this equipment. This also marked the 6th consecutive quarter

that U.S. trade experienced year over year declines.

As the dollar continues to remain strong in the international markets, U.S. companies will continue to be at a competitive disadvantage. For next quarter, it will be interesting to see the impact of the Chinese currency devaluation.

Market Intelligence

THE BELOW CHARTS ILLUSTRATE A ROLLING 4 QUARTERS VS. PREVIOUS 4 QUARTERS FOR COUNTRIES WITH > $25 MIL./YR IN EXPORTS

Exports ImportsWorld Area 2015 2nd Qtr % Change Q/Q % Change Y/Y 2015 2nd qtr % Change Q/Q % Change Y/YNorth America 687,249,977$ 18.09% -19.30% 221,856,012$ -22.26% -29.89%Central America 280,839,719$ 2.76% 3.57% 163,119,783$ 5.36% -24.63%South America 180,321,192$ -4.00% -37.45% 11,698,309$ 10.07% -21.35%Europe 421,521,342$ 2.68% -27.74% 912,017,945$ 9.82% -13.42%Asia 324,522,180$ 82.35% 17.99% 742,995,156$ 7.03% 9.52%Australia and Oceania 234,187,728$ 94.02% 7.97% 17,948,970$ -23.04% -41.80%Africa 65,106,919$ -2.88% -32.99% 655,176$ -8.14% 1.14%TOTAL 2,193,749,057$ 20.58% -15.09% 2,070,291,351$ 3.54% -10.42%

continued, page 10

Trade data courtesy of U.S. Census Department.


Beginning August YTD — August Inventory

2015 2014 %/Chg 2015 2014 %Chg August 2015

2WD Farm Tractors

<40 HP 8,802 8,694 -1.2% 84,102 78,150 7.6% 64,229

40< 100 HP 4,833 4,990 -3.1% 39,967 39,352 1.6% 30,933

100+ HP 1,567 2,248 -30.3% 16,528 20,648 -20.0% 10,161

Total 2WD Farm Tractors 15,202 15,932 -4.6% 140,597 138,150 -1.8% 105,323

4WD Farm Tractors 160 331 -28.7% 1,958 3,509 -44.2% 1,023

Total Farm Tractors 15,362 16,263 -5.5% 142,555 141,659 -0.6% 106,346

Self-Prop Combines 501 728 -31.2% 3,339 5,500 -39.3% 1,481

AEM Ag flash equipment sales data

Large farm tractors sales continue to sufferProduction ag sales continue to suffer in August. Although still above its 2006 lows, the market is underperforming significantly compared to previous years. This segment is down about 33% for this period year over year. The USDA’s farm income forecast, a driver behind sales for larger equipment, has once again declined. Farm income is expected to come in $58.3 bn, 20% lower than previously estimated. n

AEM Ag flash sales trends and analysisSmall tractors continue to growFarm tractors <40hp reported an increase of 1.2% compared to the retail sales for August last year. While retail sales for these small tractors is still up 7.6% YTD, compared to the same period last year. In 2015, tractor sales have been carried almost exclusively by <40hp tractors. With the global economic climate slowing down we might see this segment shift in lower drive. 40-100HP 2WD is still up YTD. All together, August 2015 looks similar to August 2014.

Market Intelligence

Data courtesy: Association of Equipment Manufacturers Statistics


Market Intelligence

for planning came in at 4.4% down from 15.4% last quarter, but up from –15.8% last year.

When asked about the market, some of our respondents commented with: “Doesn’t

look strong”, “What started out slow, got slower”, “Ag continues to decline for the 4th consecutive quarter” and “Demand is sluggish with flat to negative forecast for the next 12 months.”

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Planning Scenario Unit Volume of Demand Y2Y

Demand SLUGGISH

Most accounts indicate that the ag equipment downturn will continue into

2016. Some reports, including our special report this month, indicate that not all segments of the market are affected equally. While we initially expected a relief in commodity prices, a better than expected USDA forecast has momentarily squelched these hopes.

In Q2 2015, our member survey indicates that the net rising index for demand year-over-year continued to be negative and lower than the previous quarter. The index came in at –45%, down from –38.4% last quarter and –17.6% last year. This is the 6th consecutive quarter that we have had a negative index. An index below zero means that more respondents believe the market is shrinking versus growing. Last quarter, we did see an uptick in the net rising index for planning (next 12 months), but that optimism seems to have fizzled. While still positive, few respondents are indicating the market is growing. The net rising index

Inventory levelsInventories at the manufacturer and dealer levels are an important market indicator. In Q2 2015, the survey shows the net rising index for inventories (units) inched up from -11.5% to -10.4% compared to the previous quarter. At the dealer level the net rising index for inventories increased to -12.8% from -30.8% the previous quarter.

While these numbers represent increases, they are still negative, indicating that more people believe inventories are decreasing vs. increasing. Compared to Q1 2015, it must be noted that a larger group of respondents indicated inventories were just right for both categories. Whether this trend will continue will remain to be seen, but for now this is showing that the shedding of inventories seems to be slowing, indicating that our members have adjusted to the 2015 market.

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Source, Market Intelligence – North American Ag Equipment Trends report.

These data and much more are available to AEM members participating in the Industry Conditions Survey. If you would like to

participate, please contact [email protected] for details. n

Quarterly North America Ag equipment industry trends report


CommoditiesMarket Intelligence

Grains: Following the surprising upward revisions for U.S. grain yield and stocks by USDA on August 12, Business Monitor International (BMI) believes grain prices will only display limited growth in the coming months. As such, they will be revising their 2016 grain price forecasts downward. BMI, as well as several other forecasters, was expecting the USDA to downwardly revise production forecast due to reduced yields and lower acreage stemming from wet weather. Additionally, they expected grain stocks to decline due to increased livestock production. At one point on August 12, both corn and soybean prices fell by the

The data on this page was compiled from the data provided by Business Monitor International. AEM has consumption, production and price data (historical and forecasted) for various commodities and countries worldwide. This information and additional analysis is for sale for members on a report by report basis. For more information, please email Benjamin Duyck at [email protected].

Commodity Unit Current Price

YTD (% Chg)

1 Year (% Chg)

2014 (avg)

YTD (avg)

2015f (avg)

2016f (avg)

Cocoa (London) GBP/tonne 2,055 3.8 0.1 1,923 2,040 2,000 1,950Coffee USc/lb 137 -18 -25 178 140 150 145Corn** USc/bushel 368 -7.2 1.6 415 379 405 430Cotton USc/lb 68 12.1 6.4 76.3 63.8 67 72Feeder Cattle USc/lb 215 -2.2 -1.6 205 214.5 na naLean Hogs USc/lb 66 -18.6 -30.5 106 92.3 na naLive Cattle USc/lb 147 -11.2 -2.9 152 148.2 na naClass III Milk (3rd-Month) USD/cwt 17 8.3 -20.2 20 16 18.5 19Palm Oil (3rd-Month) MYR/tonne 2,035 -10.2 -1.6 2,936 2210 2,350 2,425Rough Rice USD/cwt 12 3.1 -9.7 13.9 10.5 11 12.5Soybean** USc/bushel 914 -10.3 -18.4 1,242 982.2 1,000 1,025Sugar #11 USc/lb 11 -25.7 -30.3 16.3 12.9 12.5 14Wheat** USc/bushel 495 -16.1 -9.3 587 517.1 570 620

maximum amount allowed in one day by the CBOT exchange.

Over the coming months, the fundamentals suggest that grain prices are due for another rally, but external forces will probably prevent a significant increase. BMI continues to believe that USDA will ultimately revise 2015/16 US grain production downward in the coming months, which will cause grain prices to eventually head higher from spot levels. There has been discussion that the USDA has overestimated production, as soil conditions have deteriorated slightly in recent weeks (impacting yields).

Softs: Soft prices will remain weak over the coming quarters, pressured by bountiful supply. El Niño does pose an upside risk to sugar and palm oil prices, but ample supply will keep prices from rallying to the levels seen in 2010 and 2011.

Like other softs, Asia Pacific dairy prices will remain subdued over a six-month horizon, pressurized by abundant supply and lackluster global import demand for dairy products. However, a recovery in prices is in the cards for 2016 as low prices will start to dent production in New Zealand, while China’s import demand will recover from current low levels.

A recent report by the global Agrievolution Alliance indicated that while the global business climate is expected to improve in the next 6 months, the current situation indicates a clear decline in global turnover in Q1 2015. Overall, Asian markets have a more dynamic development with a positive climate in China, India and Turkey. Other established markets such as the U.S., Europe and Japan are still negative.

While exports have decreased, the U.S. domestic market is moving in different directions. Small equipment used for landscaping services, hobby farmers and livestock continues to grow, while sales of larger tractors and combines, used in production ag, continue to decline.

Lower crop prices caused an uneven market in Europe, while in Asia, the

declines mostly focused on China. In South America, the Brazilian market, which remains highly subsidized, experienced not only lower commodity prices, but also a delay in the government’s financing program. Overall, conditions for the U.S. remained more positive as it was supported by smaller equipment sales and an improved livestock/dairy sector. n

continued from page 7

U.S. Ag equipment export trends and analysis


Global Business

Latin America agricultural machinery exports down

Total U.S export sales of agricultural equipment and parts to Latin America

have decreased overall in 2Q15 compared to last year for the same period. Central America experienced a 4% increase, while South America suffered a 37% decrease. The latest figures marked a quarter total decrease of 17% accounting for both Central and South America from 2Q14 to 2Q15.

Certain Latin American regions continue to solicit our products in spite of the current economic slowdown in some countries. Exports to both Mexico and Chile have increased from Q2 of 2014. The numbers show a 13% increase in exports to both countries. In addition, exports to Bolivia were up 4%. This demonstrates continued demand despite economic hardships.

In terms of total export sales to the region, USD 457,178,578 worth of agricultural machinery was shipped during 2Q15 compared to USD 550,262,832 for 2Q14. See the chart below for a comparison of

total export sales to the region for Q2 year over year. For more detailed information in terms of dollar value for individual countries and/or regions, see pages 21-23 of the Latin American Agriculture Advisor at aem.org/Global/IntlMarketInfo/LatinAmericaAdvisors.

The top five exported products include: tractors and parts, sprayers, irrigation equipment, harvesting machinery and components, and combines.

For further information on U.S. agriculture machinery exports to Latin America or anywhere in the world, please see the AEM Agriculture Global Markets Report at aem.org/MarketInfo/MarketIntel/GlobalMarkets. n

La Boca, Buenos Aires

Region Q2 2014 Value (USD) Q2 2015 Value (USD)

Central America $ 270,205,545 $ 280,507,951

South America $ 280,057,287 $ 176,670,627

Total $ 550,262,832 $ 457,178,578

www.aem.org/global/intlmarketinfo/latinamericaadvisors


I didn’t deliberately seek out a career in agriculture, but how I grew up made me

feel comfortable there,” says Tommy Jones, President and CEO of Krone, NA. It all began in Arkansas, where Tommy spent his childhood summers working beef cattle operations owned by his grandparents, aunts and uncles. They worked as one big family; he claims he “got a spanking from every aunt and uncle growing up”. Deciding after his freshman year of college that school wasn’t for him, Tommy landed a job at a small bank. While he enjoyed the work, unfortunately his boss there taught him “everything you should not do” as a manager. So he gladly took the opportunity when he was recruited by a colleague at Deere.

While at Deere, Tommy went on to complete his college education along with an MBA from Drake University. His deep-rooted understanding of farming complemented his interest and education in finance leading to a successful 28-year career at Deere, often working on the credit side and including the start-up of a credit operation in Australia. In 2013, Tommy became President & CEO of Krone, NA.

How was your transition at Krone, with Rusty Fowler having run the company for 26 years and you having spent about the same number of years at Deere?

I cannot imagine how it could have been any better. And I give full credit for that to Rusty. He decided that for the first six months he would maintain day-to-day operational responsibilities. I had no direct reports or responsibilities. I travelled non-stop, meeting with dealers, customers, staff, attending farm shows. Being new and neutral, folks shared with me what they thought was good or bad, what should change. After six months (what German leadership now calls my “sabbatical”), I presented a strategic plan based on all I’d learned. It was approved by Germany with full support. Rusty stayed on for another six months as an advisor. It was brilliant.

Family owned for over a hundred years, Germany-based Krone is a global industry leader in hay and forage equipment. What are some of the things that struck you as a newcomer to the organization? What sets Krone apart?

Being family run, they are able to make decisions – like approving the strategic plan – incredibly quickly. Also, having their name on the equipment makes it very personal. Dr. Krone, now semi-retired, has actually told customers, “if you don’t like my machine, you bring it back. I’ll give you your money back”. And he would do it. That attitude is simply inherent throughout the organization - even with no “customer focus” staff training. It seems to be innate and is an integral part of the Krone family and business.

What is the best piece of career advice anyone ever gave you?

That you have to learn to say no. As a manager, you want to help, you want to say yes. But sometimes saying yes is not the right thing, and you have to be able to say no. I learned that from Jim Isreal, who recently retired as President of John Deere Financial.

Krone has been an AEM member for 28 years and utilizes our stats programs, technical groups and surveys. You serve on the Ag Sector Board and several committees including the Specialized Ag Equipment Leadership Group, which you Chair. Can you speak to the specific benefits to Krone from those programs and to yourself through your engagement?

As a smaller manufacturer, being involved in AEM keeps us abreast of what’s going on in the industry from a competitive, regulatory and legislative perspective. On our own, we would not be able to access the kinds of information that we get through AEM. We can see the trends and get to know our competitors on a personal basis.

From gigging frogs (for us northerners, boating a bayou or canal at night shining a light to spot the glowing underbelly of frogs, then catching them for frog legs) to dining in the company of Queen Ann at a black tie dinner in London, Tommy definitely lives up to his comment that he is “the most culturally diverse person he knows”. He enjoys hunting, fishing and cooking. He and his wife spend free time visiting their grown son and daughter in Houston, and recently bought a farm in Iowa where they like to go to “work around the farm and relax”. n

You have to learn to say noLeadership

“ You have to learn to say no. As a manager, you want to help, you want to say yes. But sometimes saying yes is not the right thing, and you have to be able to say no.”

“

http://www.krone-northamerica.com/


Standards

Exhibit space is going fast!2015: 4,300 growers averaging 2,989 acres 2016: AEM joins Commodity Classic

n March 3-5, New Orleans

n Extended trade show hours

n Customer preview & event opportunities

n What’s New sessions showcase your innovations (October 19 RFP deadline)

n Media exclusive preview time

n Connect with innovators, leaders, early adopters

Email [email protected] or call 636-922-5551 to reserve your exhibit space.

www.commodityclassic.com/exhibitors/why-exhibit

For standards information, contact Scott Cedarquist at [email protected].

A listing of ASABE standards projects may be found at http://www.asabe.org/projects.

The American Society of Agricultural and Biological Engineers (ASABE)

announces the completion of ANSI/ASAE S343.4, Terminology for Combines and Grain Harvesting. The revision aligns terminology with currently used practices. The standard contains terminology pertinent to grain combine design and performance, improves communication among engineers and researchers and provides a basis for comparative listing of machine specifications.

ASABE has begun a project to adopt with deviations an international standard, ISO 5675:2008, for hydraulic couplers on tractors. The proposed standard, ANSI/ASABE AD5675:2008,

Agricultural tractors and machinery — General purpose quick-action hydraulic couplers, will replace ASAE S366.2, Dimensions for cylindrical hydraulic couplers for agricultural tractors.

ASABE would like input from twine producers, large square baler manufacturers, and users of agricultural baler twine on its project to revise ANSI/ASAE S315.4, Agricultural Baling Twine for Automatic Balers. The standard provides uniform polyolefin and sisal agricultural baler twine specifications to ensure satisfactory performance in round and square balers as well as adequate durability in normal storage and handling of baled forage and biomass materials. It is being revised

to add a larger packaging size category for large square baler twine to provide an alternative for greater twine-carrying capability and re-wording of the description for knotters on a large square baler. Anyone interested in providing input on this revision is asked to contact Scott Cedarquist, [email protected]. n


EPA star rating impact on sprayer manufacturersThe Environmental Protection Agency

(EPA) has launched a star rating system as part of their Drift Reduction Technology (DRT) Program. Participating sprayers and components will receive a 1-4 star rating based on their drift reduction capabilities. This rating has the potential to strongly impact product marketing in the future, as farmers who use higher rated equipment will have fewer work restrictions (such as reduced buffer strips) to contend with.

To learn more about the program and to provide feedback to EPA, AEM’s Sprayer Leadership Group invited officials from EPA’s Office of Pesticide Programs (OPP) to their recent meeting hosted by AGCO at the Farm Progress Show. Almost 40 meeting participants shared in open dialogue with the OPP officials. They learned about the registration process, testing required, EPA labelling and more.

Manufacturers also educated the officials as to the complexity of their products and the number and variety of factors and potential solutions involved in mitigating drift. EPA acknowledged that seeing the spraying equipment the previous day did give them a much better understanding. The officials were given a tour of AEM Sprayer Leadership Group member booths at the show. Staff from each of the member companies were able to talk one-on-one with EPA and illustrate to them the innovations made and technologies employed on their equipment towards improving product placement.

For more on AEM’s Sprayer Leadership Group, contact Director of Agriculture Product Management Anita Sennett at [email protected]. For details on the EPA DRT program, contact Director of Public Affairs Nick Tindall at [email protected]. n

Manufacturer Alert

EPA provides details of the DRT Registry program to AEM members

Officials from EPA’s Office of Pesticide Programs talk with Dale Szuminski, President & CEO of Hardi NA and Chair of the AEM Sprayer Leadership Group, and other Hardi staff before checking out the sprayer.


AEF ISOBUS database use increasing

The Ag Industry Electronics Foundation (AEF) ISOBUS database helps dealers

and farmers with troubleshooting and identifying product compatibility. Use of the tool among farmers and dealers, primarily in Europe, has been steadily increasing since its launch in February. AEF would like to see the U.S. also enjoy the benefit of this valuable database. AEF Chairman Peter van der Vlugt recently presented a report to the AEM Board on the status of foundation projects and activities, including the recently launched database. AEM is a founding member of AEF along with German sister association VDMA and eight

ag equipment manufacturing companies.Component certification with the AEF Conformance test helps OEMs provide ISOBUS compliant components for use in their products. The unique Plugfest events organized by AEF in the U. S. and Europe have provided an exclusive opportunity for OEMs and other equipment manufacturers to test their systems for compatibility. Peter noted that AEF is a prime example of manufacturers cooperating for the benefit of all of our customers and the industry.

Organized by project teams made up of hundreds of member company engineers

and marketing experts, two of the most recently added include Wireless Infield Communications and High Speed ISOBUS. These are part of the group’s new five-year strategy called Route 2020, providing a clear mission and vision for AEF’s future. The group has grown from about 40 member companies at its start in 2008 to more than 180 spanning 21 countries today. For more information or to become a member of AEF, go to www.aef-online.org or contact AEF Technical Director Mark Benishek at [email protected]. n

AEM is deeply committed to the agriculture sector and has assembled a dedicated team with a passion for agriculture and backgrounds firmly rooted in the industry. Our agriculture specialists are devoted to serving you, our agriculture sector members.

John Rozum, Director, Ag Events

John Rozum grew up on a beef and poultry farm in Wisconsin. He graduated from UW Madison with a major in Ag Journalism and Poultry Science. Rozum then worked in Ag radio with Pam Jahnke at what is now

called the Wisconsin Farm Report. He later led trade show operations at World Dairy Expo for 14 years. John Rozum joined AEM in 2013 as Attendee Acquisition Manager for AEM’s lineup of trade shows. Since

then he has transitioned to his current role, allowing him to focus on his areas of expertise. John serves as president of the Badger NAMA Chapter and is on the board of the National Agri-Marketing Association.

Technical Innovations

www.aef-online.org


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Register for AEM’s Annual ConferenceJoin us for the 2015 AEM Annual Conference, and our experts will prepare you to navigate the changing tides in industry, politics and the economy. For more information and to register online now, go to aem.org/Education/Conferences/Annual. Book your hotel room at 800-542-8680 and mention “AEM Annual Conference” to receive the group rate, valid through October 19 or until the block is full.

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