Farm Credit VIEW - Fall 2012
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Transcript of Farm Credit VIEW - Fall 2012
I N T H I S I S S U E
2 DiD You Know:Ryan Berg, Vice President, Field operations
3 CRoP insuRanCe news Drought Response
Gary Kopp, Regional sales Manager
4 news FRoM the FielD new employees, milestones, retirements
and upcoming events
5 CustoMeR sPotliGht From Dirt to Dessert
an interview with the Condill Family
in arthur, illinois
6 CRoP insuRanCe news Crop insurance 101 workshops
Continued from page 3
FARM CREDIT view
This year’s harvest
yields have delivered
a sobering dose of
reality. Daily tes-
timonies over the
past two months
from Farm Credit
customers remind us of the toll this summer’s
drought and record heat have taken on corn
yields throughout our service area. We knew
it could be ugly and indeed many farmers
with decades of experience have harvested
fields setting new record lows for yields. A
few have encountered corn fields averag-
ing single-digit yields. Fortunately, there are
also some pleasant surprises that surpassed
expectations with yields from near one-
hundred to the upper one-hundreds. But for
a year when input costs may have reached a
new high, there is no denying that production
agriculture will remember 2012 as a year of
disappointment.
We know poor yielding corn and soybean
fields take much of the fun out of farm-
ing – even if a crop insurance claim will be
supplementing some of the shortfall. We also
recognize the consequences of the drought
echo from the grain farmers to much of the
Illinois agricultural industry. Livestock growers
face reduced feed availability and higher feed
costs. Virtually everyone involved in produc-
ing, using, or handling grain is impacted.
It would seem intuitive that this year’s harvest
leaves farm families with a bitter taste.
However, in an amazing demonstration of
resiliency, many farmers chose to face this
year’s adversity with gratitude. They remain
thankful for what they have. They know they
don’t have to look too far to find someone
who faces a more difficult situation in life.
Sometimes it takes adversity to remind us
to open our eyes more fully and recognize
the many blessings we too often take for
granted. This challenging year in agriculture
is an appropriate time to inventory our most
important blessings and priorities. Faith, fam-
ily, friendships, and freedom usually are at the
top of the list. Of course, each of those gifts
has responsibilities and personal commit-
ments that go with maintaining them.
Farm Credit has an attitude of gratefulness
too. We are thankful for several consecutive
years of strong financial performance and we
are blessed to work with stockholders who
manage strong balance sheets and give our
Association’s loan portfolio a stellar credit
quality of 99.6%. We are well positioned to
manage through the financial impact of this
Grateful Attitudes Help Sweeten Bitter HarvestBy Dave Owens, C.E.O.
year’s severe drought.
In August, the Board of Directors and manage-
ment team established drought relief assistance
programs being offered to the cooperative’s
stockholders. Although we can’t make it rain or
restore a lost crop, Farm Credit is committed to al-
ways being there to support our customer owners. Please see Grateful Attitudes, page 2
“As a cooperative business, our overriding concern is for the financial viability of our
customer stockholders.”
FALL EDITION 2012 • news & hiGhliGhts FRoM FaRM CReDit seRViCes oF ill inois
2
Account Access: Check Out FC ConnectBy Ryan Berg, Vice President Field Operations
Last May, we launched a revised online banking
account access website, FC Connect.
• FC Connect allows you to view all of your
Farm Credit Services of Illinois lending
relationships in one place.
• If you have already enrolled, FC Connect
can be accessed by visiting fcsillinois.com
and clicking on Account Access at the top
of the screen. If you haven’t enrolled, click
on Resources>online tools>online BAnking
and begin the process of setting up an FC
Connect account.
• An interactive demo for our system is
located under ResouRces >online tools
>online BAnking so you can explore the
FC Connect environment. If you have
already enrolled, you
can access this demo
directly from the
welcome screen.
• You can access a
variety of documents
by selecting
Statements and Bills
from the menu at the
top of the screen or
from the “i would like
to” section. Copies of
statements, bills and
tax documents are available.
• If you would like to transfer money either
to or from another financial institution,
contact your local Farm Credit office. Once
you receive access, you will see a “mAke A
pAyment” or “mAke A disBuRsement” link under
the “i would like to” section. You can also
transfer funds between your Farm Credit
loan accounts.
• You can view all of your current principal
and interest balances as well as any
balances in Funds Held. You can also
view your interest rates and the amount of
interest you have paid and earned for the
current year and prior year.
• If you have sight drafts tied to your
operating loan, you can view copies of
cleared drafts by clicking on the blue draft
number on the Account Transaction screen.
• FC Connect allows you to view your
Funds Held activity separate from your
loan activity. This feature is only available
through FC Connect.
Our staff is prepared to assist stockholders
facing unexpected cash flow challenges as a
result of the drought by restructuring existing
loans to defer current payments and ease
immediate cash flow shortages. Additionally,
Farm Credit invites individual borrowers to
consider the current opportunity of locking
in historically low long-term interest rates
to help manage future interest rate risk.
Finally, all borrowers who have an existing
operating loan are receiving an interest-free
period – for up to $100,000 of the loan
balance on existing operating loans – during
the traditional harvest months of September,
October, and November. This program is
automatically applied to eligible operating
loans as of September 1; all interest charges
on loan balances up to $100,000 through
November 30, 2012, will be credited back to
the account balance.
As a cooperative business, our overriding
concern is for the financial viability of our
customer stockholders. Farm Credit is com-
mitted to standing with our stockholders
through both the prosperous as well as the
challenging times in agriculture. We fully
recognize both the economic and emotional
struggle farm families face from this year’s
harvest.
For many, it was a bitter harvest. But we can
all still choose an attitude of gratitude for our
most important blessings that will sweeten
the bitterness of this year’s adversity.
Continued from page 1Grateful Attitudes
3
2012 DROuGhT REsPONsE
Should I do anything
different with crop
insurance next year? Due to the drought of
2012, this growing season will go down in
the history books. Many producers question
whether they should make changes to their
crop insurance coverage for 2013. Illinois
corn ranged from 0-70% of normal yields
while drought stricken soybeans recovered
after late rains in mid August. Despite higher
commodity prices, 2012 grain revenue will be
down with more than half of most producers’
cash incomes coming from corn. What is
filling the gap? In most cases crop insurance
is filling the revenue gap.
Many producers believe they had the correct
level of coverage this year. A USDA report
indicated 8.8 million of Illinois’ insured corn
acres were at or above the 75% coverage
level. The same report showed 79% soybean
acres insured at or above the 75% coverage
level. Depending upon your budget and
risk management objectives, these could be
considered adequate policies. However, when
20% of Illinois corn and soybean acres have
either a lower level of insurance or none at
all, there is room for improvement in 2013.
Producers pay one way or another. If you
choose to adequately insure your crops, you
pay the premium each year. If you make
the decision to leave your crops uninsured
or select a lower level of coverage and you
experience a significant drought like we
did this year, how many years of premium
savings on a lower plan (or no plan) does
it take to recover lost income?
Something to consider.
LOOkING AhEAD
First, make sure you understand what
is available through the standard MPCI
program. With 95% of policies based on
a producer’s APH or average yields, make
sure your policy includes two important
options – YA (Yield Adjustment) and TA
(Trend Adjustment). These will give you the
best insurance yield, recognizing higher trend
yields with better farming practices (TA), and
replacing very low yields (as in 2012 or prior
years) with at least 60% of a county yield (YA).
Next, your policy should protect against both
yield loss and price change, choose either RP
(Revenue Protection) or GRIP HRO (Group
Risk Income Protection with Harvest Revenue
Option). Yield only policies – YP (Yield
Protection) or GRP (Group Risk Plan) are still
good plans. But avoid revenue-only plans
- RP-HPE (Revenue Protection with Harvest
Price Exclusion) and regular GRIP, which in
2012 may have disappointed producers.
These revenue-only plans cover less yield
as Harvest Prices increase (corn up 32%,
soybean price up 23%), so the protected
yield decreases by the same percentage. Your
Farm Credit crop insurance specialist can
explain further.
2012 GRIP or GRP county plans may pay out
extremely well given the low yields on corn
and possibly soybeans in 2012. They are
designed to pay well in years like 2012, but
in most years loss payments on GRIP and
GRP are well under the expensive premiums.
If you were on this roller coaster in 2012, you
probably will be thrilled and ready to ride
again. But the cost each year, plus the lack of
protection for your individual operation, may
keep most people away from these plans.
Due to legislation, GRIP coverage may be cut
back in 2014.
Producers with land in High Risk (flood
prone) areas will have a new option in
2013 called HR-ACE – High Risk Alternate
Coverage Endorsement, which allows
separate buy up coverage on HR acres. Your
2013 choices:
1. With HR ACE, your HR acres in the
policy could have 65% RP coverage
while your other land has 75% RP
coverage. HR ACE acres must be on
basic or optional units but you can have
any unit choice, including Enterprise, on
the regular acres.
2. You can still insure high risk acres
with your other land—all at same %
level—and pay the higher premium on
HR acres.
3. Or you can simply not insure the HR
acres at all with a High Risk Land
Exclusion HRLE.
4. Or finally with the HRLE, you can
exclude the HR acres and cover these
with a CAT policy (50% of yield, 55% of
price). Remember CAT has only a $300
fee per crop, and no premium due.
Crop Insurance News & UpdatesBy Gary kopp, Training Coordinator of Related services
Crop Insurance News
4
Field News
Important Dates
kim DeterdingRed Bud
Farm Credit Team MilestonesA special salute to employees reaching years of service milestones.
5 YearsRuss DetersEffingham
Mark Your Calendar
15 Yearsshari Edwards
sherman
15 YearsJudi NeeseJerseyville
Welcome AboardMeet the newest staff members in our regional offices.
Amy Deibertsherman
Dana AdamsDecatur
15 YearsMargie Meyer
Effingham
5 YearsPenni hart
Jacksonville
sharon WaldhoffEffingham
Craig koorsharrisburg
Joe horabikJacksonville
5 Yearshollie NixonJerseyville
5 YearsJill hunt
Lawrenceville
5 YearsErrol MaulMahomet
5 YearsCheri Lange
Red Bud
5 YearsLee WatersMahomet
• November 16 Decatur Ladies Bus Trip - Michigan Avenue, Chicago, IL Jacksonville Ladies Bus Trip - Chesterfield Mall, Chesterfield, MO Lincoln Ladies Bus Trip - St. Louis Galleria Mall, St. Louis, MO Mahomet Ladies Bus Trip - Woodfield Mall, Schaumburg, IL Mt. Vernon Ladies Bus Trip - South County Mall, St. Louis, MO Springfield Ladies Bus Trip - Chesterfield Mall, Chesterfield, MO Taylorville Ladies Bus Trip - West County Shopping Center, Des Peres, MO
• November 22- 23 Closed - Thanksgiving Holiday Observed
• November 28 Farm Credit College - Farm Financial Analysis - Kellers Convention Center, Effingham, IL
• November 29-30 Lincoln and Springfield move to Sherman, IL
• December 6 Farm Credit College - Beyond Fundamentals: Managing Crop Price Risks - Crowne Plaza, Springfield, IL
• December 7 Harrisburg Ladies Bus Trip - Opryville Mall, Nashville, TN
• December 13 Farm Credit College - A Focus on Farm Family Succession & Success - Hamilton’s, Jacksonville, IL
• December 24-25 Closed: Christmas Holiday Observed
• For all upcoming events, go to our website: www.fcsillinois.com
5
Customer Spotlight
From Dirt to Dessert“The 200 Acres” Provides Family Fun on the Farm
The entire Condill family is passionate
about produce –cucurbits in particular, a
technical term for pumpkins, squash and
gourds. Nestled in the heart of Illinois
Amish country, locals know the Condill
farming business as The Great Pumpkin
Patch. But that’s just one of three
businesses under the banner of The 200
Acres – The Great Pumpkin Patch, The
Homestead Bakery added in 2006, and
then Homestead Seeds was introduced in
2009. Mac refers to the seed business as
their “newest pumpkin on the vine”.
Along with his two brothers, Mac Condill
is a fifth generation farmer. “We’ve been
in business as a family since 1989,” said
Mac, “but the farm was homesteaded
in 1859 by the McDonald family on my
mother’s side.” A large part of the mission
of The 200 Acres is to provide a true
farm experience for visitors. “If we can
open our place up to let people experience
a farm and nature and what it is to be
connected to the land –
then we’ve succeeded,”
said Mac. But don’t
let his signature floppy
hat and easy-going
manner fool you. He
is extremely bright,
ambitious and has a
highly honed business
sense. He has definitely
put The 200 Acres
on the map with
appearances on the
Martha Stewart Show,
displays at the White
House, and a display at
the national Heirloom
Exposition in California.
Mac Condill has coined the term ‘dirt to
dessert’ for what they do at The 200
Acres. “We grow it, we care for it, we
produce it, we sell it,” said Mac. “We have
so much diversity here: diversity in plant
offerings, cultural diversity with the Amish
community and diversity in our cucurbit.”
They currently grow 400 varieties of the
vegetable. That diversity becomes obvious
when you drive around and see the
displays and unique
presentations of this
amazing vegetable
family. And visiting
children are delighted
with the animals on
site: Tom Turkey, the
three Billy Goats Gruff,
a llama, an Alpaca,
pot-bellied pigs, and
unique breeds of
roosters and chickens.
This year’s favorite animal is Thomas, the
little baby lamb who is bottle fed daily and
follows Mac around like a puppy.
Where does Farm Credit come into all
of this? “As the business was growing
naturally,” said Mac, “we were buying
and selling baked goods from a third party
vendor. So I thought this may be something
we could produce ourselves and turn into
a full-fledged, year-round business.” That’s
when Mac and one of his brothers and
their wives seized the opportunity to buy
an existing Amish bakery. They turned to
Farm Credit for the capital. According to
Mac, “we chose to work with Farm Credit
because of their flexibility. Plus our dad
had been working with them for years.
We’re ag-based and roll the dice year-
to-year with the weather like every other
farmer. Not everybody gets that. But Farm
Credit does. They understand this is a
journey and they’re partnering with us for
the long-term.”
The Great Pumpkin Patch’s official season
is September 15 through October 31. The
Homestead Bakery and Homestead Seeds
are open year round. To learn more, visit
their website: the200acres.com
Mac Condill holding a Native American Douglas heirloom squash
1100 Farm Credit Drive
Mahomet, IL 61853
www.fcsillinois.com
Crop Insurance EventsCrop Insurance 101 and Winter Meetings
Five informative workshops began in
November to provide a comprehensive
discussion (2-3 hours) of crop insurance risk
management options.
If you are interested
in attending, please
call the Mt. Vernon or
Harrisburg office to
make a reservation
for these workshops.
There is no cost
to attend.
• November 12, 2012 9:00 AM - Noon Windsor Oaks, Grayville, IL
• November 13, 2012 9:00 AM - Noon John A Logan College, Carterville, IL
• November 27, 2012 2:30 PM - 5:30 PM Shawnee Community College, Ulin, IL
• November 28, 2012 6:00 PM - 9:00 PM Farm Credit Office, Mt. Vernon, IL
Please plan to attend our annual area
meetings beginning in December for a review
of the changes in crop insurance and to find
out how it will impact your 2013 coverage.
A full listing of meeting dates and locations
will be coming soon. Contact your nearest
regional office for details.
Crop insurance with Farm Credit. It’s a “good fit.”
Crop Insurance 101Back to the Basics