ISA 2017-18 IMPACT REPORT

ILLINOIS SOYBEAN ASSOCIATION

2

TAKE CHANGE BY THE HANDWinston Churchill said, “If you don’t take change by the hand, it will take you by the throat.”

Sage advice for soybean producers operating in a fast-paced, quickly evolving industry with the pressures of profitability and producing enough food, feed and fuel for growing global markets.

The Illinois Soybean Association (ISA) in the last year has embraced this philosophy. The ISA board of directors took strategic steps toward a new level of leadership with the intent of helping soybean producers be relevant in the current and future marketplace. 

Such steps are crucial to successfully navigating a path to profitability with all of the revolutions our industry, and other industries, are experiencing. Innovation is a necessary change to the way things used to be done if the Illinois soybean industry is to grow and prosper.

Soybean producers, next year and for the foreseeable future, will encounter challenges and opportunities. Some may be predictable, but many may not as they haven’t arisen. New disruptions, positive and negative, will occur in the world market and global geopolitical arena.

The ISA board of directors acknowledges this through funding relevant programs that not only provide practical on-farm advice, but that focus on new technology and innovation, move soybeans to market in unique ways and create new market opportunities. We are participating in global protein discussions for soybean use as food and feed, and we are taking a lead in looking at blockchain feasibility, health insurance and water quality and availability. 

People and organizations need to embrace and prepare for change with new innovations, new policies, new partners and with no fear of industry evolution. ISA and Illinois soybean producers will continue to lead and charge forward. 

FRESH, BOLD APPROACH TO PROFITABILITYThe Illinois Soybean Association (ISA) has always worked to advance the state’s industry with producer profitability top of mind. From early research that led to better yields, to development of innovative new uses like biodiesel, to meeting expanding global food and feed demand, ISA efforts are targeted at making Illinois soybean producers the most knowledgeable and profitable.

During the last year, the ISA board of directors shifted course on its strategic direction. Profitability is still the priority. But how we approach that has changed as the world around us changes. We are embracing bold ideas to set Illinois soybean producers apart. We are seeking partners that want to engage in creating the technology we need to provide for the future. And we are connecting with the innovators who can help us move the needle for Illinois producers.

Innovation and technology are both critical to helping us solve today’s problems as we anticipate tomorrow’s challenges. We are questioning the status quo and finding new opportunities for local communities and global consumers to have a better living, inspired by soy.

ISA also is championing improved infrastructure, dependable transportation and sustainable fuel to reliably get soybeans where they need to go. We are exploring water issues. As stewards, it is our responsibility to safeguard the limited fresh water supply for all people. We are supporting animal agriculture to power rural economies and provide high-quality protein to nourish others.

Soy provides food for people, feed for animals, fuel and more. ISA has long been a force of influence. Now, ISA is ready to grow and ready to lead, for life, for the future and for the world.

LYNN ROHRSCHEIBISA Chairwoman

CRAIG RATAJCZYKISA CEO

MARKETPLACE

2017-18 IMPACT REPORT

3

LEADING TUNA FEED RESEARCHThe second phase of research on a soy-based diet for ranched tuna generated broad industry interest during the year. ISA led a trip to observe research that brought together stakeholders, including soybean and industry members from feed development and aquaculture. Taste tests of the tuna explored the potential to manipulate characteristics for maximum value.

EXPORTING SOY PROTEIN AS MEAT AND POULTRYThe ISA checkoff program works with partners to promote U.S. meat and poultry products. In 2017-18, the U.S. Meat Export Federation (USMEF) reported strong pork exports. The ISA checkoff program funded pork promotion efforts in Central America and the Dominican Republic, where pork exports are surging and setting records. The U.S.A. Poultry and Egg Export Council (USAPEEC) reported the U.S. exported the highest volume of poultry during the first half of 2018, surpassing Brazil, as new markets like India and Morocco opened.

OPENING BARN DOORS FOR TOP CUSTOMERSThe ISA checkoff program supported nine open houses for new animal agriculture barns in 2017-18, participating in events and placing congratulatory ads in 34 local newspapers reaching nearly 243,000 neighbors. ISA also participated in The Equity’s Horace feed mill open house and created congratulations ads to show support for the direct use of soybean meal.

CALCULATING VARIETY FEED VALUEThe High Yield PLUS Quality (HY+Q) program is revealing the value of soybeans at the variety level to benefit soybean and livestock producers. Soyvalue.com provides feed value scores for soybean samples sent in by farmers and information about livestock feed values of the varieties. In 2017-18, ISA assembled an international nutritionist team to find a way to calculate feed value of more than 37,000 samples and to create a process to predict relative variety feed values.

STIRRING EXCITEMENT FOR HIGHER BIODIESEL BLENDSISA connected in 2017-18 with retailers, fleets and other fuel influencers to generate excitement about biodiesel and inspire sale and consumption of higher blends. A fuel sampling program with 459 Chicagoland fuel stations found 88 percent carry blends of B11 or higher in warm months. About 11 percent carry blends of B5 or less, showing opportunities for future growth.

HOSTING TRADE TEAMS IN CHICAGOThe Chicago office became a strategic place to meet with international leaders and soybean buyers to discuss trade this year. The ISA checkoff program hosted two receptions for consulate representatives based in Chicago, resulting in high-level delegations coming from Indonesia, Germany and Taiwan.

ORGANIZATIONAL EXCELLENCE

ILLINOIS SOYBEAN ASSOCIATION

4

FINDING INLAND WATERWAYS SOLUTIONSAn ISA-led summit convened stakeholders with attendees from eight states and Washington, D.C., to gain consensus about the future of the nation’s inland waterways. The group agreed that a funding model of majority federal, part-private, part-state is the most viable financial solution for inland waterway funding and maintenance.

Participants suggested next steps should include development of a coalition that creates funding change within federal government and exploring alternative investment and project delivery approaches and innovations.

TAKING INITIATIVE TO PINPOINT TRANSPORTATION CHALLENGESISA conducted a survey to pinpoint producer challenges and opportunities to move soybeans and initiated conversations with various transportation area leaders to support soybean profitability.

THINKING INSIDE THE BOXISA was successful in connecting two shippers to new freight

companies that resulted in shipping about 200 containers of

soybeans, or about 183,718 bushels, from Chicago. The increase

in business via ISA connections keeps more soybean movement

in Illinois and creates more trade flows. Trade facilitated by ISA

included buyers from Thailand, China, Taiwan and Indonesia for

soybeans and the Philippines and Myanmar for soybean meal.

FORGING A NEW STRATEGIC LEADERSHIP DIRECTIONISA initiated a bold, new strategic direction into FY20, working with groups and leaders in Chicago, downstate Illinois and nationally to help Illinois soybean producers be more profitable, resilient and relevant. ISA’s vision is to enable Illinois soybean producers to be the most knowledgeable, sustainable and profitable in the global marketplace, while the mission is to ensure Illinois soy is the highest quality, most dependable, sustainable and competitive in the global marketplace. Funding priority was placed on marketplace, farmer profitability, stakeholder value and organizational excellence.

TRAINING TOMORROW’S SOYBEAN LEADERSISA continued to place emphasis on recruiting new producer board members and providing opportunities for new leaders to learn and grow to best serve the state’s 43,000 soybean producers. Board members participated in a variety of short-term educational sessions, as well as engaged with innovative thought leaders to foster dialogue and action as ISA builds on Illinois’ position as the fourth-largest soybean producer in the world.

EFFICIENT PRODUCT DELIVERY

INFLUENCE AND REACH

2017-18 IMPACT REPORT

5

ISA tariff and trade interviews had the potential to garner more than 431.6 million media impressions worldwide.

SHARING ISA’S MESSAGE WITH THE WORLDAs soybeans took center stage in tariff and trade discussions, ISA leaders opened their farm gates to the world. Reporters from top-tier U.S. publications, China, Japan, France, the Netherlands and more visited ISA leaders on their farms. ISA spokespeople conducted more than 50 interviews, and provided statements or offered sources to more than 50 additional media outlets. Media requests have the potential to garner more than 431.6 million impressions worldwide, as ISA sources appeared in the Wall Street Journal, Chicago Tribune, Bloomberg and others.

FUELING A CONNECTIONISA found a unique way to educate influencers about the soybean industry and its benefits to the state. Caffeinated soy lattes were given out in the Capitol so legislators could taste a soy-based product, shake a producer’s hand, share a photo on social media, and walk away with a story to tell. More than 60 public officials and 300 staff members engaged with ISA.

MEMBERSHIPILLINOIS SOYBEAN GROWERS ADVOCACYFACILITATING CUBA INCLUSION IN THE FARM BILLThe 2018 farm bill contains the first Cuba legislation in more than 18 years. Illinois Soybean Growers (ISG) was active in getting Market Access Program and Foreign Market Development funding for Cuba as part of the bill. The Cuba amendment would not have become reality without the hard work of Illinois soybean producers, as ISG focuses on opening the market.

RESPONDING TO INDUSTRY ISSUESThe Voice for Soy (VFS) legislative action network allows producers and industry stakeholders to quickly and easily take action on issues important to them. VFS’ value was demonstrated when the network saw its highest comment response on an action alert. EPA’s consideration to cut proposed 2018 and 2019 advanced biofuel volume requirements under the Renewable Fuel Standard generated a record-high 6.7 percent response rate.

FARMER PROFITABILITY

ILLINOIS SOYBEAN ASSOCIATION

6

EXTENDING CCA SOY ENVOY KNOWLEDGEA unique partnership between ISA and the state’s Certified Crop Advisers (CCAs) positions both as trusted resources to help farmers improve yields and profitability through better on-farm management and sustainable practices. Six CCA Soy Envoys brought agronomic expertise to the ILSoyAdvisor blog, ISA-hosted events and monthly podcast interviews.

GROWING A PROFITABILITY COMMUNICATIONS HUBISA’s first-of-a-kind soybean management blog has grown into a robust resource. ILSoyAdvisor shares information needed to grow better beans with strategies rooted in sustainability, best management practices and innovation. The site has more than 45,000 unique visitors annually, averages 20 new articles per month and has a continuing education webinar series.

TARGETING THE RIGHT RESEARCHThrough the North Central Soybean Research Program, ISA funded work regarding soybean management, fertility, weeds, diseases and insect pests. ISA also focused on Illinois research into the potential for cover crops to aid in the battle against soybean cyst nematode (SCN).

At the 2018 Commodity Classic, ISA sponsored University of Illinois professor Fred Below’s “Six Secrets of Soybean Success” session for producing high-yield soybeans. ISA also supported the Resilient Farmer Roadshow featuring key habits of the most financially successful farmers as identified through studies led by University of Illinois ag economist Gary Schnitkey.

HONING IN ON LOCAL SOYBEAN ADVICEISA collaborated with the CCA Soy Envoy program and their respective organizations to bring the 2018 Better Bean Series events to five locations across the state: Polo, Mendota, Jacksonville, Altamont and Fairview Heights. The half-day events featured expert agronomic advice and resources to help producers achieve profitable yields. More than 450 Illinois soybean producers, CCAs and industry representatives attended.

FEATURING SOY IN THE CITY TECH + FOODThe ISA checkoff program brought partners to the table in August to talk about technology’s role in food as part of its Soy in the City initiative. While guests came from different supply chain sectors, they all had something in common: technology impacts and influences their everyday work. ISA educated guests on food industry tech while fostering conversations about the future. Four hosts covered blockchain, CRISPR and drones with 23 influencers. Four restaurants prepared soy-inspired dishes. All guests said they would recommend the event to a colleague.

PARTNERING PRODUCERS WITH COMMUNITY STEWARDSHIPAn innovative partnership joined producers and conservationists to impact a Chicago community together. ISA worked with Audubon Great Lakes, The Wetlands Initiative, Chicago Park District and local volunteers to revitalize the Indian Ridge Marsh in south Chicago. Strategic relationships were forged to position ISA as a trusted source on production agriculture. About 90 volunteers planted 4,000-plus native seedlings while learning about environmental stewardship.

STAKEHOLDERS

2017-18 IMPACT REPORT

7

VIEWING DOWNSTREAM CHALLENGES FIRSTHANDA two-day tour of the lower Mississippi River watershed exposed ISA directors to the area’s unique challenges and opportunities and how sustainable farming affects water quality. In addition to an aerial tour of the hypoxic zone in the Gulf of Mexico, stops included the Coastal Protection and Restoration Authority, Port of Southern Louisiana and a local sugar cane farm.

FOCUSING ON SOIL HEALTH AND WATERISA encourages farmers to adopt best management practices (BMPs) to enhance soil health and water quality with an eye on profitability. Through various education tools, ISA offers actionable information related to conservation practices. In addition, ISA works with other groups to build relationships, leverage resources and amplify a unified conservation voice so farmers understand and make best use of on-farm practices to improve soil health and water quality.

CONNECTING INNOVATION AND SUSTAINABILITYISA committed to leading collaborative efforts that bring innovative solutions to improving the social, economic and environmental well-being of producers, communities and the world. ISA is addressing many of the United Nation’s Sustainable Development Goals, including those that address poverty, hunger, energy, water and climate action.

SUSTAINABILITY

Illinois leads the nation in production of soybeans, an important protein source for animals and humans around the world. ISA believes that by working together through shared commitments to United Nations Sustainable Development Goals, we can increase value for soy customers and partners. Our collaborative efforts bring innovative solutions to improve the social, economic and environmental well-being of our farmers, our communities and our world.

BOARD OF DIRECTORS

ILLINOIS SOYBEAN ASSOCIATION

8

EXECUTIVE> ADM

PRINCIPAL> Cargill Inc. > Monsanto/Asgrow

CORE> DowDuPont> FMC Corporation

ASSOCIATE> Syngenta> Valent U.S.A.

AFFILIATE > Big River Resources> The Andersons> Ursa Farmers Co-op> BASF> Beck’s Hybrids> Farmers Business Network> FLM Harvest> GROWMARK Inc.> Informa Economics Inc.> MorganMyers> Osborn Barr> U.S. Borax Inc.

OTHER SUPPORTERS> Farm Progress> Grain & FeedAssociation of Illinois> HighQuest> Mercaris> Midwest Shippers Association

CORPORATE SPONSORS

DISTRICT 1Paul RasmussenGenoa, IL

DISTRICT 10Elliott UphoffShelbyville, IL

DISTRICT 5Stan BornLovington, IL

DISTRICT 14Brad DaughertyWest Union, IL

AT LARGEAustin RinckerMoweaqua, IL

DISTRICT 3John LongleyAledo, IL

DISTRICT 12Roberta Simpson-DolbeareNebo, IL

DISTRICT 7Thomas KentnerDanville, IL

DISTRICT 16Brian Atteberry Carmi, IL

AT LARGE Scott Gaffner Greenville, IL

DISTRICT 2Steve PitstickMaple Park, IL

DISTRICT 11Doug SchroederMahomet, IL

DISTRICT 6James Martin Pontiac, IL

DISTRICT 15Daryl CatesColumbia, IL

AT LARGE Jenny MennengaLeRoy, IL

DISTRICT 4Sharon CovertTiskilwa, IL

DISTRICT 13Ed MurphyFarmersville, IL

DISTRICT 8Dale AsherSutter, IL

DISTRICT 17 Nick HarreNashville, IL

AT LARGE Lynn RohrscheibFairmount, IL

DISTRICT 9Carrie WinkelmannTallula, IL

DISTRICT 18Rick RubenackerMcLeansboro, IL

AT LARGE David WesselChandlerville, IL

AT LARGE Jeff LynnOakford, IL

2017-18 IMPACT REPORT

9

FINANCIALS

7102 8102 STESSA

CURRENT ASSETS 884,273 $ 440,932 $ stnelaviuqe hsac dna hsaC 882,504,31 368,511,31 stnemtsevni mret-trohS

Accounts receivable 413,92 506,02 ytrap detaleR 800,611 088,58 rehtO 868 478,1 elbaviecer tseretni deurccA 427,34 933,21 sesnepxe diaperP

096,769,31$ 506,574,31 $ stessa tnerruc latoT

PROPERTY & EQUIPMENT 510,932 $ 510,932 $ dnaL 321,05 955,811 tnempiuqe dna erutinruf ogacihC 555,713,1 555,713,1 stnemevorpmi gnidliub dna gnidliuB 281,541,1 852,231,1 selcihev dna tnempiuqe ,erutinruf eciffO

578,157,2 $ 783,708,2 $ 453,473,1 856,384,1 noitaicerped detalumucca sseL

$ 1,323,729 $ 1,377,521

$ 14,799,334 $15,345,211

ILLINOIS SOYBEAN BOARD

STATEMENTS OF FINANCIAL POSITION

August 31, 2018

10

ILLINOIS SOYBEAN ASSOCIATION

FINANCIALS

7102 8102 STESSA TEN DNA SEITILIBAIL

CURRENT LIABILITIES 994,451,2 $ 626,245,1 $ elbayap gnidnuF 806,650,1 679,267,1 elbayap dna deurcca sesnepxE 647,821 002,441 draoB naebyoS detinU ot euD - 000,524 noitanimret noisnep denifeD

,591 stifeneb tnemeriter-tsop deurccA 626 -

358,933,3 $ 824,070,4 $ seitilibail tnerruc latoT

LONG-TERM LIABILITIES 000,524 $ - $ noitanimret noisnep denifeD

Accrued post-retirement benef 000,591 - sti

000,026 $ - $ seitilibail mret-gnol latoT

NET ASSETS 089,356,8 $ 092,599,7 $ detangisednu – detcirtsernU 000,005,2 000,005,2 evreser detangised draob – detcirtsernU 873,132 616,332 sdnuf craps-erp – detcirtsernU

853,583,11$ 609,827,01 $ stessa ten latoT

$ 14,799,334 $15,345,211

ILLINOIS SOYBEAN BOARD

STATEMENTS OF FINANCIAL POSITION (CONTINUED)

August 31, 2018

11

2017-18 IMPACT REPORT

See Notes to Financial Statements.

tegduB ecnereffiD )detiduanU( lautcA

CHANGES IN UNRESTRICTED NET ASSETS Operating revenue and other support:

Checkoff receipts from first purchasers $ 29,228,613 $ 20,200,000 $ 9,028,613 Checkoff receipts from other soybean boards 2,860,934 1,300,000 1,560,934 Less: National checkoff to United Soybean Board (15,027,549) (9,450,000) (5,577,549) Checkoff to other soybean boards (2,009,430) (1,300,000) (709,430)

865,203,4 $ 000,057,01 $ 865,250,51 $ stpiecer ffokcehc latoT

)223,8( )000,05( )223,85( sesnepxe noitcelloc sseL

642,492,4 $ 000,007,01 $ 642,499,41 $ stpiecer ffokcehc teN

578,99 $ 000,05 $ 578,941 $ nruter tnemtsevnI )188,4( - )188,4( stessa dexif fo lasopsid no ssoL

Sponsorships and miscellaneous income 41,001 - 41,001 )783,294,4( 783,294,4 - gnidnuf latnemelppuS

)293,653,4( $ 783,245,4 $ 599,581 $ eunever rehto latoT

Total unrestricted operating ,51 $ troppus rehto dna eunever 180,241 $ 15,242,387 $ (62,146)

Operating expenses: 920,455 $ 534,043,7 $ 464,498,7 $ gnidnuf noitcudorP )543,622( 462,671,7 919,949,6 gnidnuf gnitekraM

015,704 241,604 256,318 gnidnuf evitucexEManagement and administrative expenses 253,259 319,546 (66,287)

Prior year project (write-offs) expenses (74,601) - (74,601)

96,638,51 $ sesnepxe latoT 3 $ 15,242,387 $ 594,306

)254,656( $ - $ )254,656( $ stessa ten ni esaerceD

- 853,583,11 853,583,11 raey fo gninnigeb ta stessa teN

)254,656( $ 853,583,11 $ 609,827,01 $ raey fo dne ta stessa teN

ILLINOIS SOYBEAN BOARD

STATEMENTS OF ACTIVITIESFor the Year Ended August 31, 2018

VISIONEnable Illinois soybean producers to be the most knowledgeable, sustainable and profitable in the global marketplace.

MISSIONEnsure Illinois soy is the highest quality, most dependable, sustainable and competitive in the global marketplace.

1605 Commerce Parkway • Bloomington, IL 61704(309) 663-7692 phone

(309) 663-6981 fax

190 S. LaSalle Street Suite 1715 • Chicago, IL 60603312-260-3782

www.ilsoy.org