May/June 2016 - Farmway Coop

cooperative
advantage
the
F A R M W A Y C O - O P, I N C .
May/June
2016
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67 I
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olume
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H e l pin g O u r O wn e r s S u cc e e d
S h arin g P r o fi t s / S u cc e s s L e a d
D e v e l o p P r o f e s s i o na l P a s s i o na t e E m p l o y e e s I nn o va t iv e S o l u t i o n s
P r o vi d e G l o b a l M ar k e t
wi t h
acc e s s
“Before I had the corn planted in the ground, there were issues with my planter putting
me $5,000 in the hole, but thanks to TPP Warranty, I knew I could get it fixed fast and
have the repair cost covered,” said Brian Freeman, Republic County producer. “Sooner
or later they (tractors) all break down, no matter the color. So it’s smart to protect your
equipment.” Freeman utilizes the Cenex Total Protection Plan Warranty through Farmway and recently received $5,033 to cover the cost of a tractor repair. Pictured here is:
Brian Freeman and grandson, Kash Henderson, receiving a check from JD Bahret.
2MAY/JUNE 2016
contents
7
Introducing
Lee Parker
10
Employee
Spotlight
12
Scholarship
Winners
Announced
On the cover, Kids at Harvest Time: Jeff Bates of Beloit
photographs his children in a wheat field during the 2015
wheat harvest. This photo was entered in the 2015 Farmway
Kansas Agriculture Photo Contest. From left to right is Adam,
Luke, Brandon and Megan. Aaron is pictured in the tire.
5
Farmway Insights
News and views from the Farmway team
6
Farmway Receives ResponsibleAg Certificate
Clay Center Crop Production and Beloit Fertilizer Plant
8
Keeping Profits in Farmway Country
Local ownership, Local business
14 2015-2016 Farmway Co-op, Inc. Financials
THE COOPERATIVE ADVANTAGE
3
gr e e tin gs
T
he membership and stockholders of Farmway Co-op can
once again be congratulated for coming through another
challenging year on a number of fronts with positive results. I reported at the annual meeting earnings totaling $3.4
million on total sales of $389 million. The year did not necessarily
meet our expectations, but through our employee performance and
the members support, Farmway continues to enjoy strong financial
footing.
Sales were down from the prior year by 8% or $37 million on
decreases in commodity prices, fertilizer and petroleum price reductions, unit sales in energy, crop protection were up from the
previous year with fertilizer sales being lower as a consequence
of poor fall movement. Gross revenue increased about $4 million
with expenses increasing $5.7 million. As I stated at the annual
meeting, the expense increase is mainly due to a charge back from
AgMark for a put-through revenue we receive on grain we handle.
The charge back occurs when the grain is sold. This is new this
year, so compared to a year ago when it did not exist it looks like
a very large increase. Our grain revenue had $7.6 million more
revenue than last year due to the same put through income from
AgMark. Our annual grain handled for Farmway was right at 5
year averages. However, we only create income on the grain side
(other than put-through from AgMark) when the grain is marketed.
The timing of our year-end does not allow us to market the fall
crop by Jan. 31. So we carried in more grain into this fiscal year
than we ever have. Our philosophy is to market the grain when the
market wants it versus when it is convenient. We hope to be able to
market a lot of the grain we carried into this year as well as some
of this year’s crop. As of right now the future markets are telling us
to hold onto wheat so we will see where we end up by year’s end.
Space could become a luxury by fall if we have a normal fall crop.
Energy had a respectable year as our volumes of petroleum products has reached 20 million gallons sold annually. The gallons
have doubled in the last five years. In agronomy, the spring season
was above average for sales and movement of products. The after
wheat and fall movement of product did not materialize due to dry
weather from the first week in August to November. In November
we started to get moisture and we couldn’t get back in the field to
apply much fertilizer so we had excess inventory. The value of that
fertilizer inventory decreased by the end of January so we took
a write down on the value of the inventory. This affected overall
profitability in agronomy and the cooperative in general.
The Farmway Board of Directors is allocating $983 thousand in
patronage to members who are eligible. $560 thousand will be
paid in cash, which represents 100% of qualified patronage and
$423 thousand will be allocated to non-qualified patronage with
Farmway assuming the tax obligations on the non-qualified allocation. Farmway is also passing through to eligible members
$3.5 million in Section 199 Deduction representing 12.3 cents per
bushel sold to Farmway. The board of directors will be making
a determination on equity retirement in August. At this time the
plans are to entertain the decision to retire the year 1993 for both
Farmway Co-op Equity holders and the former Farmer’s Union
equity holders for a total of $407,500. The years of equity held by
the two pre-merger entities evened up a year ago with the equity
retirements paid out last fiscal year.
The financial condition of the cooperative remains in great shape.
The net worth of the company continues to grow reaching $62.7
million. Total assets at the end of the year were $240 million and
liabilities totaled $176 million. Since 2007 the networth of the
company has increased by $42 million. The overall networth and
strength this represents gives us the ability to handle some volatile
times and look forward to continuing to grow our business.
Continued on Page 5
Board Chairman
Tim Porter, Glen Elder, District 1
Vice Chairman
Alan Aufdemberge, Lincoln, District 2
Secretary
Jacob Porter, Mankato, District 1
Directors
Darrell Schroeder, Tipton, District 1
Eric Eilert, Beloit, District 1
Mike Jordan, Beloit, District 1
Steve Errebo, Sylvan Grove, District 2
Ken Keil, Concordia, District 3
Nolan Sandell, Republic, District 3
Ron Benson, Clay Center, District 4
Darren Hofmann, Leonardville, District 4
Raymond Larson, Green, District 4
Associate Directors
Matthew File, Beloit
Luke Shamburg, Beloit
4MAY/JUNE 2016
The Cooperative Advantage is published quarterly for the
members and affiliates of Farmway Co-op, Inc.
All editorial and advertisements are screened along rigid standards, but the publisher assumes no responsibility for accuracy or validity of claims, nor guarantees the absence of errors
or omissions; all rights reserved. Farmway has the right to
accept or deny any submissions.
Mail editorial contributions or advertisement requests to:
Farmway Co-op, Inc.
Attn: Mallory Wittstruck
204 E Court Street
Beloit KS 67420
Phone: (785) 738-2241
Email: [email protected]
President & CEO
Art Duerksen
Chief Financial Officer
Monte Broeckelman
Vice President Human Resources
Julie Harrison
Executive Vice President Grain
Wes O’Bannon
Vice President Communications & Member
Services
Mallory Wittstruck
Vice President Petroleum
Lee Parker
Vice President Agronomy
Jeff Jensby
Read this newsletter online at www.farmwaycoop.com.
Follow us on Facebook at www.facebook.com/farmwaycoop and on Twitter at @farmwaycoop.
Farmway continues to reinvest in the cooperative to
increase value for all stakeholders
E
very year when I
write the spring article for the “Cooperative Advantage”
it seems that I am worried about the wheat crop.
This year is no different.
We sowed the crop in very
dry conditions, but a late
wet and warm fall got the
wheat crop caught back up
and looking good.
By Wes O’Bannon, Executive VP Grain
bushels. We are also looking at upgrading a couple
legs this summer. We will
be installing a new leg at
the Courtland West facility
and will be upgrading the
west leg at Leonardville, to
increase dumping capacity. We anticipate today
that both of these projects
would be complete for fall
harvest.
The grain market has been
We are currently planning
a challenge, and unless
for wheat crop of 100% of
there is a major weather
last year’s handle. Wheat
event somewhere across
acres are down, in some
the globe I do not see imareas significantly, but
provements anytime soon.
crop conditions look better
With these conditions there
than last year. Demand for
is opportunity to capture
wheat from domestic end
some carries in the futures
users and export remains
market. Farmway Co-op
pretty dismal. With this,
has shares available in
we will be planning on carMember Owned Storage
rying a lot of wheat into
LLC #1 that can be purthe fall harvest. (As we did
chased today. With ownin 2015.) We are looking
ership, you would be able
into possibly adding sevto capture additional reveral potential bunker sites
enue to add to your grain
to insure we have enough
sales. If you have quesspace for fall harvest. The
tions on purchasing Memlast several years China
ber Owned Storage, please
has wanted all the milo we
contact Monte Brockelman
could get shipped as soon
(785) 738-0751 or myself
as we received it. This has,
at (785) 738-0785. If you
at least for the time being,
have questions on how to
changed so we will need to
capture additional revenue
hold most milo this fall at
utilizing Member Owned
harvest. We will monitor
wheat harvest bushels, and The construction crew breaks ground at the Clay Center 5th Street expansion Storage, please contact
AgMark at 1 (888) 848fall crop conditions to fine project on Friday, May 20.
tune the needs this summer. We are going to install another grain 9979. I want to close by saying “Thank You!” We appreciate your
bin at our Clay Center 5th street location. It will be a 360,000 bush- business and want to continue earning your business by helping
el steel tank that we hope to have ready for fall harvest. This will you succeed!
increase the storage capacity at Clay Center to almost 4 million
I congratulate Darrell Schroeder, Jacob Porter and Steve Errebo
for being re-elected to the Board of Directors. I also congratulate
Nolan Sandell and Darren Hofmann for being newly elected to the
board. My thanks to Rick Chaffee and Chase Larson for the years
they served on the board. It was a pleasure serving with them. In
the reorganizational meeting by the board following the annual
meeting, Tim Porter was reelected Chairman of the Board, Allen
Aufdemberge was reelected Vice-Chair and Jacob Porter was reelected Secretary of the Board.
This past year had its own unique set of challenges and I am sure
that the current fiscal year will once again have us face a completely new set of opportunities. I am confident with the strength of the
financial condition of Farmway, a talented employee group and the
diligence of the Board of Directors we will once again emerge at
fiscal year-end with positive results. Thank you for your business.
Your support is greatly appreciated.
Stay safe. Your family, friends
and cooperative need you.
THE COOPERATIVE ADVANTAGE
5
Safeguard Your Equipment the Easy Way
You invest in only the best high-performance diesel
equipment for your business. So doesn’t it make sense
to also invest in the highest quality fuel available for
your equipment?
You can help protect your investment and avoid devastating downtime by using Cenex® Premium Diesel
Fuels. The complete additive package and quality base
fuel in Cenex Premium Diesel Fuels work together
to optimize performance – delivering improved fuel
economy, more power and superior engine protection.
In fact, Cenex Premium Diesel Fuels contain a superior lubricity enhancer to deliver 10-15% better lubricity
than standard fuel—which means less wear and tear on
your fuel system, lower maintenance costs and reduced
downtime.
Recently Cenex Premium Diesel Fuels were enhanced
with a special additive designed for new diesel engines. This advanced additive helps prevent common
problems associated with using standard #2 diesel
fuel, including injector failure, clogged filters, reduced
efficiency, power loss, poor starting, costly repairs and
even engine failures.
Cenex Premium Diesel Fuels are continually tested in
the lab, in the field and over the road, and they consistently outperform standard #2 diesel fuel.
6MAY/JUNE 2016
In fact, they are proven to:
•
Improve fuel economy by as much as 5%
•
Improve fuel lubricity by 10-15%
•
Improve power by as much as 4.5%
•
Have a typical cetane number of 48
•
Extend the life of injectors and injector pumps
•
Reduce maintenance costs
•
Operate better in modernized diesel engines.
•
Promote quicker, more fuel-efficient starts
•
Reduce smoke and emissions for cleaner air
Plus, Cenex Ruby Fieldmaster is backed by the Total
Protection Plan® Warranty, which covers qualified agricultural equipment for up to 10 years or 10,000 hours
when you use Cenex lubricants and Ruby Fieldmaster.
That’s even more proof that Cenex Premium Fuels are
worth the investment. (Visit cenex.com/tpp for more
information or to enroll.)
“For 10 years where are you going to get that type
of warranty? It’s a no brainer,” said Brian Freeman,
Republic County producer. “With $3 corn, you don’t
want an unexpected $40,000 repair bill on equipment.”
Freeman recently received $5,033 through the TPP
Warranty. (Picture on page 2.)
At Farmway Co-op, we’re ready to help protect your
business and diesel equipment with dependable Cenex
Premium Diesel Fuels. For more information about
Ruby Fieldmaster or any of our quality lubricants and
energy products, contact JD Bahret at (785) 534-9831.
Introducing.... Lee Parker
By Lee Parker, VP Petroleum
H
ello from your Farmway Energy department. I am excited
to introduce myself as the new leader of your energy team.
Although Vice President of Petroleum is a title I represent,
the value of our team lies in the employees that make up our
department. More about them in a bit, but first, let me tell you a bit
about myself. I was raised in a little town in Kansas that some of
you may be familiar with called Westmoreland. I attended a small
school there, but spent my summers on family farms located in
Manhattan and Smith Center. After high school, I attended Kansas State University, and continue to support their academic and
athletic programs. My first ‘paying’ job was at the cooperative in
Westmoreland, and my career has been related to Energy in both
cooperatives and independents, located in several different states
for the past twenty-seven years, and continues here at Farmway.
Enough about me, let’s spend some time reviewing my first few
days being involved with your Farmway staff and energy department. In the process of being hired, as well as the process of
meeting and getting to know the people that make up the group of
Farmway employees, it was easy to see that this crew is very talented, well driven, and focused on the needs of the customers and
members of the cooperative. This makes my transition very easy
in getting involved in the goals of the cooperative, as well as helping support the items and challenges of our energy department.
ships that we currently have with our members, customers, and
suppliers, as well as start and develop profitable relationships with
new customers and our team. As much as energy products have
become treated and transformed into a commodity, I am sure that
we have much more to offer than the ‘product’ that we deliver.
Our people will be available to offer you information and solutions
that you can utilize to eliminate any worry that you may have with
how fuel, lubricants, propane, or related items affect your business
or home.
As you and I move forward, please utilize our staff to make sure
that your energy needs are being met in the best possible way. I
hope that you have found our offerings to be beneficial to you in
the past, and hope to only increase how we take care of your needs,
sometimes before you know the need even exists. I look forward
to communicating with our patrons over the next several months as
I get settled in to North Central Kansas, to make sure that the path
we take benefits both you and the business I represent. Until next
time, be safe and enjoy your Spring.
I assume that as you read this, you will feel a sense of pride in
being a customer of our business, and allowing us to assist you
with your energy needs. The reason I feel this way is that it is
very obvious to me that my employees take a great pride in the
relationship they have at the homes, farms, and businesses of the
people we supply with goods and services. If you have not yet
experienced the opportunity of allowing us to assist you, I encourage you to discover what it is that we have to offer. From sales
expertise, safety, innovative solutions, and delivery performance,
we hope to provide you with the comfort that your needs are being
met in a manner that makes you realize that there is no better solution than Farmway Co-op to constantly take things to a level that
exceeds your needs.
Our first and primary goal as I get more acclimated to your energy
department will be simple. We plan to expand upon the relation-
Lee Parker awards Ernest France a $100 Farmway Fuel Gift Card
at the Farmway Abilene Fueling Site Grand Opening, May 19.
THE COOPERATIVE ADVANTAGE
7
Steve Lilley, Clay Center Crop Production Location Manager, accepts the ResponsibleAg Certificate from Larry Clemons.
By Larry Clemons, Regulatory/Risk Management Coordinator
F
armway Co-op is pleased to announce that the company’s
Clay Center Crop and Beloit Fertilizer locations have recently completed their first audit and resulting corrective actions under a new initiative from Responsible Ag, joining
over 165 other agronomy businesses across the country in receiving their certification from ResponsibleAg. ResponsibleAg is a
newly formed non-profit company created to assist the agronomy
industry to meet federal environmental, health, safety and security
compliance standards for safe storage and handling practices of
fertilizer. ResponsibleAg implemented their program as a result
of industry incidents raising attention to the industry, and with
encouragement from government officials asking the agriculture
industry to self-regulate, and hold itself accountable as experts in
their field of business. Participating businesses, such as Farmway,
are provided a federal regulated compliance audit relating to safe
storage and handling of fertilizers with recommendations for corrective actions where needed, and a suite of resources to assist in
the process. ResponsibleAg strives to support compliance with
federal regulations, demonstrate accountability and transparency
to provide safety of employees, customers and communities and
continue to serve the vital need of the agriculture community for
crop nutrients.
and grounds. Following the audit a corrective action is assigned to
the facility based on timing estimated to make corrections needed
to comply with the associated federal standard. Upon completion
of the corrective actions the facility is presented its certification.
Following certification the facility will repeat the auditing process
every three years as a means of on-going compliancy verification.
Farmway continues to be pleased in joining other agronomy industry business in this initiative to ensure its accountability and
transparency to its employees, customers and its community. In
receiving the certification Farmway continues its goal to ensure
the communities we live and work in trust we have taken the
required steps to ensure not only our employees safety, but our
communities as well. I am continuing to work with all Farmway
Agronomy locations assisting them to achieve certification with
ResponsibleAg.
Farmway is one of more than 2,000 locations that have registered
in the program so far. These businesses have the option of hiring
a third party auditor, or selecting an internal auditor to be trained
and certified by Responsible Ag. Training is achieved utilizing a
converted Ag retail site that has been set up as a training site with
office for classroom training, and grounds that provide hands on
auditing experience in all areas of the retail agronomy industry
including fertilizer, chemical, seed and fuel handling practices.
The audit consist of a 320 question checklist of federal regulatory
requirements, designed to assess 17 types of facility areas including dry fertilizer, liquid fertilizer, anhydrous ammonia, shop office
8MAY/JUNE 2016
Clay Henningsen, Beloit Fertilizer Manager, receives the ResponsibleAg Certificate from Larry Clemons,
Keeping Profits Right Here In
FARMWAY COUNTRY
By Jeff Jensby, VP Agronomy
W
here does your money go? Or rather, where do you focus
your purchasing power?
Keep that thought for a moment. It is spring here in north
central Kansas. The rain has finally come. The grass is green.
Seeds are going in the ground. A wheat crop is developing. What
one might call “Real Wealth” is being created everywhere... baby
calves hitting the ground, bushels of grain filling trucks and semis,
bales of alfalfa moved out of the fields. I am not talking services or
white collar activity. I am talking real wealth, real things, coming
from the God-given resources we have in our home area of north
central Kansas. Upon this real wealth all other economic activity
is built. Banking, health care, education, transportation, insurance,
construction... all these businesses are important to our communities and are built upon the real wealth created by our farmers and
ranchers and manufacturers.
What are we blessed with here in this part of Kansas? Good productive soils, adequate rainfall to grow crops, good quantities of
crop residue for animal feed, livestock, smart and hardworking
farmers and business people... all these resources one can put together to create “Real Wealth.”
A college student recently asked what our Farmway Co-op really did and why does it matter. My answer was we search for
and provide the best inputs, management ideas and technologies
from across the world for our owners. We provide these to our
farmers, ranchers and business people who create real things, real
wealth, from the resources in our area and then build infrastructure
to sell and transport this newly created wealth across the world.
And one more very important thing... we pay back or invest the
profits earned in those input and output transactions to the very
people who create the real wealth in the first place. The profits stay
here. They don’t disappear into the hands of some multinational
company who could care less about our life and communities here.
When one dumps a bushel of wheat at one of our many Farmway
elevators during harvest, you are really delivering food across the
planet. Someone far away is paying for your “real wealth” created
right here. China may export box store goods to us, but their people need our food. Dollars move from overseas back to you. Your
Farmway is what helps make that happen... and any profits from all
those transactions get delivered right back to you too!
When we live in a rural area the “where” we direct our purchasing
dollars really does matter. We can fall prey to buying some cheap
item or service from a place far away that will never ever pay taxes
to support our schools, never employ families to keep our communities vibrant and alive... simply moving our financial assets to
places like China, Canada or California. Gone forever might be the
best way to describe it.
As you participate in your Farmway Co-op you help reverse that.
You help build assets, employ people, and keep your communities
vibrant and alive.
We appreciate your business and look forward to helping you create more “Real Wealth” this growing season!
Split Fertilizer Application Helps Optimize Nutrient Management
By Jerry Brown, Fertilizer Procurement Manager
S
plit nitrogen fertilizer applications can play an important
role in a nutrient management strategy that is productive,
profitable, and environmentally friendly. Dividing total nitrogen application into two or more treatments can help you
enhance nutrient efficiency, promote optimum yields and mitigate
the loss of nutrients. More specifically synchronizing nitrogen
supply with a plant's ability to utilize nutrients, split application
can be an important component of 4R Nutrient Stewardship - right
source, right rate, right time and right place.
Depending on soil type, climate, agronomic practices and other
factors, nitrogen fertilizer can be vulnerable to loss. Denitrification, leaching and volatilization impose costs that include lost pro-
ductivity and negative environmental impact. Split-applying nitrogen fertilizer is one way to minimize these challenges. When a
crop's total nitrogen requirement is supplied with a single pre-plant
or at-planting application, most of the N must "wait" for the target
crop's future needs and that means the window for potential loss
remains open longer. Postponing a portion of the N treatment until
the crop is better able to utilize the nutrient, plants take up the nitrogen more quickly and efficiently. That means you get more from
your fertilizer investment and minimize nitrogen loss. When you
split your N application and put a portion on later, almost all of that
second application will be taken up by the plant. Plant roots are
more developed and better able to access the N and the plant’s nitrogen requirement is increasing so uptake is much more efficient.
THE COOPERATIVE ADVANTAGE
9
EMPLOYEE
SPOTLIGHT
A
Diverse and Passionate Team. Although we may have
different personal interests and come from different parts
of the agricultural industry, it’s evident that we all share
a common bond of being passionate advocates for Kansas
agriculture. We asked Barb Grove what makes her an asset to the
cooperative team and about her experience working for Farmway.
Where are you from and what location do you work from?
I grew up in Manning, Iowa, on a grain and livestock farm. I “immigrated” to Kansas about six years ago to begin work as the
Farmway Quality Systems Manager. My office is at the Beloit
Administrative Office.
What does your typical day look like?
That is one of the things I like about my job: every day brings
something different! Our department coordinates many different things, so we get to work with Grain, Agronomy, Energy, and
Safety, as well as whatever other project might come up. Most of
my days are spent in the Beloit office, though many are out at locations working with employees. Often I’m doing research into situations for efficiency and/or correction. I utilize my great networking skills in finding the people, products, and companies that can
help Farmway get the job done right. I am very excited with my
recently expanded duties as Assistant Grain Operations Manager;
this will allow me to “get out in the country” and be more involved
in the day-to-day operations.
Can you describe a time where you felt that you made a positive difference for a customer or team member? I feel like I
make the most difference in the team atmosphere with Project
Management and Safety. We bounce ideas and problems off of
each other to find what best suits the situation. I believe all our
departments benefit greatly from the teamwork.
Barb Grove
Quality Systems Manager/Assistant
Grain Operations Manager
What have you enjoyed about working with a cooperative and
Farmway specifically? What I like about working for a cooperative is that I have the opportunity to work in the field I loved so
much growing up! I was active in 4-H and FFA, as well as coowning a livestock operation after high school. I thank God every
day that I grew up on a farm and had the experiences that I did.
About 15 years after I graduated from high school I ran into my
old FFA director. When he asked me what I was doing and I told
him, “Working for a Co-op”, he stated, “Well, I’ll be! I actually
taught you something!” Working for Farmway has given me the
ability to expand my knowledge and delve into new opportunities.
I was able to earn my Credential in Grain Operations Management
(CGOM)and my Specialty Credential in Grain Quality(CGQ)
through K-State/GEAPS with the support of Art and Wes; this has
enabled me to be better at what I do. I work with a great bunch of
people and laughter is a part of each day! This makes those moments that are a little on the stressful side all worth it!
What are your personal interests or hobbies?
I love music, reading, sports, and gardening. I sing and play piano
with the church Praise Team occasionally, sing and play for family and friends’ weddings, and sing and play for myself at home.
I’ve had the privilege of playing trumpet in the Beloit Community
Band in the Memorial Day weekend parade the last few years.
I love to read just about any type of book. Although I haven’t
been involved in playing sports much since moving to Kansas, I
stay involved with my son’s football games and coordinating Beloit’s Rotary Girls Softball. I like to plant, re-plant, and re-arrange
my flower beds; walking through them every night to see what’s
blooming is a great way to end the day! I also love spending time
with my kids and grandkids. While we live in three different states
and don’t get to see each other as often as we’d like, we chat with
each other regularly over FaceTime!
Thank you Barb for all that you do for Farmway!
Barb Grove assists at a Grain Elevatorand Processing Society
(GEAPS) Exchange.
10MAY/JUNE 2016
PRODUCER
SPOTLIGHT
A
Diverse and Passionate Team. Although we may have
different personal interests and come from different parts
of the agricultural industry, it’s evident that we all share
a common bond of being passionate advocates for Kansas
agriculture. A conversation with Lincoln County producer, Alan
Aufdemberge of Aufdemberge Farms...
How did you start farming?
I always had the aspiration to do farming. I went to NCK Technical
College and studied Production Agriculture with plans to go back
to the farm. I started in partnership with my dad in 1978. I tried to
get going on my own, which was hard to do, but my dad helped
me by sharing equipment and that kind of thing until we officially
formed a partnership to bring everything together.
What does your farm look like today?
At the start, we had wheat, milo, and some soybeans, alfalfa and
raised cattle. We were mostly tillage, but we started experimenting
with no-till in the 80s. We changed to no-till because we believed
it was the future of farming. Now, no livestock and we grow a lot
more corn and soybeans because of markets and how the farming practices have changed. After graduating Fort Hays with an
agribusiness degree, my son Derrick is farming on his own as well
as working for Aufdemberge Farms, similar to how my dad and I
started.
What is the biggest change in the industry that you’ve appreciated
or wouldn’t want to give up? Overall, the biggest change for me is
no-till. The precision part of ag is awfully important to farm, too.
Not necessarily meaning I have it on my farm, but having access to
it through the co-op like grid sampling that tells us what nutrients
to apply and where they need to be at in the field. Sometimes the
answers are expensive to find, but the efforts done to remedy it are
worth it in the long run.
JD Bahret, Farmway Energy Specialist, presents Alan Aufdemberge with a check received through the TPP Warranty Program.
Alan Aufdemberge
Aufdemberge Farms, Lincoln
What do you see is the biggest value of the cooperative?
The people and the knowledge that they provide. I think Farmway
is a very professional company and hire some of the best talent. If
you give them a chance, to get to know them or to help you out,
they really do have your best interest at heart for the customer.
It’s like the John Deere brand. It’s always there. And it seems that
Farmway has always been there. Suppliers come and go, but Farmway has always been there.
You’re part of Farmway’s Board of Directors, tell us more
about that. In 1980, I was asked to be an associate board member,
but then stepped down after two years. In 2004, I was asked again
to be an associate board member with plans to replace a retiring
board member the following year. Being a board member is really
important for the cooperative as that is what runs the cooperative.
Just being exposed to the big picture of the world through attending conferences, visiting with other board members from around
the nation is really eye-opening. There is more out there than what
is just around us.
What is your favorite part of farming?
Not having a boss. Farming is always what I wanted to do so I
enjoy it.
Recently, Alan received a TPP Warranty Check. What is that?
Total Protection Plan Warranty is for farm equipment up to 10
years or 10,000 hours. I’ve been in the program quite a bit on a lot
of equipment, but this is the first time I’ve received money from
the program. Other suppliers will tell you they have a warranty on
their oils and fuels, but I think they are a little misleading because
it has to be proven that their oil or fuel caused the problem. Whereas this TPP Warranty doesn’t require proving what is at fault.
The Aufdemberge Family
Alan’s wife, Vicki, is the USD 240 Data Coordinator and has two
children, Allison and Derrick. Allison is married and lives in Lincoln working as a Speech Pathologist for hospital and skilled nursing facilities in north central Kansas. Derrick is married and lives
in Westfall, farming on his own as well as working for Aufdemberge Farms. Thank you Alan for sharing about your farm and
family!
THE COOPERATIVE ADVANTAGE
11
2016 Far mway Scholarship
W inners Announced
By Mallory Wittstruck, VP Communications & Member Services
A
s part of the Farmway commitment to its communities, •
Farmway has awarded more than $100,000 in scholarships
throughout north central Kansas since the program’s inception in 1972. It is with great honor that Farmway announces
this year’s scholarships to such outstanding individuals.
•
Receiving an award for the Producer-Member scholarship of
$1,000 each, this year’s scholarship recipients are as follows:
• Mackenzie McPeak graduated from Beloit High School and
will pursue a degree in Marketing from Kansas State University. Her parents are Barry and Darcel McPeak, of Glen Elder.
• Tanner Kubick graduated from Sylvan Grove High School and
will pursue a degree in Wildlife Biology from Fort Hays State
University. His parents are Jerret and Tara Kubick, of Sylvan
Grove.
• Katelyn Bohnenblust graduated from Clay Center Community
High School and will pursue a degree in Agricultural Education and Animal Science from Kansas State University. Her
parents are Jay and Brenda Bohnenblust, of Clay Center.
• Tristen Winkel graduated from Lakeside High School and will
pursue a degree in Agribusiness or Agronomy. His parents are
Chris and Michelle Winkel, of Glen Elder.
Brenton Edwards, son of David (and Judy) Edwards from the
Farmway administrative office. Brenton graduated from Concordia High School and will pursue a degree in Biotechnology
from Kansas State University.
Luke Hesting, son of Janet (and Marty) Hesting from the
Farmway administrative office. Luke graduated from Beloit
High School and will pursue a degree in marketing.
Recipients were selected from a pool of applicants based on: cumulative grade point average, leadership, scholastic achievement,
extracurricular activities, academic and career goals, and essay. All
members of Farmway Co-op and their graduating high school seniors planning for postsecondary education were eligible to apply
for the Producer-Member awards. All Kansas students pursuing an
agricultural career were eligible for the Ag Career award. Students
of Farmway employees were eligible to apply for the Employee
scholarship.
“
These scholarship recipients exemplify the heart and
work ethic of rural Kansans we are proud to work with every day. Farmway’s annual scholarship program is one of the
many ways our cooperative supports future leaders, innovators, and spokespeople of agriculture.
”
Farmway Producer-Member Scholarship applicants each wrote an
essay titled “Agriculture: The Cooperative Difference,” elaborat- The 2017 Farmway Scholarship Program will be released Deceming on the role of the cooperative business model in today’s ag- ber 2016 and distributed to schools within the Farmway trade terririculture industry, why it’s important and how it can continue to tory and available on the Farmway website.
benefit farmer member-owners.
Ronal d & Phyl l i s Fi l e M em ori al S chol arsh i p
Receiving an award for the Ag Career scholarship of $1,000 is MiThe family of Ronald File of Beloit formed the Ronald File Mechaella Meyer Wahl. Michaella will pursue a degree in Pre-Veterimorial Scholarship in the fall of 2013 to commemorate the life of
nary Animal Science from Kansas State University. Her parents are
Ronald File and to continue his legacy of excellence and generRoss and Melissa Wahl, of Riley.
osity posthumously. He was a strong supporter of the agriculture
industry and saw the importance of assisting youth pursuing an agFarmway Ag Career Scholarship applicants each wrote an essay tiricultural career. Graduating high school seniors from Beloit High
tled “Agriculture: Sustaining Future Generations.” The theme preSchool pursuing an agricultural degree were eligible to apply.
sented an opportunity for students to address how the agriculture
industry is rising to the challenge of feeding a growing population.
With the assistance of Farmway hosting the scholarship, the family
Entrants wrote an essay focused on how today’s growers are overof Ronald and Phyllis File announce Haley Waddell as the 2016
coming challenges to provide a safe, stable food supply and sustain
Ronald & Phyllis File Memorial Scholarship recipient. Haley was
the significant role agriculture plays in everyday life.
awarded a $500 scholarship at the Beloit FFA Banquet.
Receiving an award for the Farmway Employee-Student scholarship of $250 each, this year’s scholarship recipients are as follows:
Congratulations again to all scholarship recipients! Farmway board
• Parker Gates, son of Brian (and Julie) Gates from the Farmmembers and employees all wish you the best.
way administrative office. Parker graduated from St. John’s
Catholic High School and will pursue a degree in Marketing Tristen Winkel’s scholarship presentation photo wasn’t available before publication
from Kansas State University.
went to print.
12MAY/JUNE 2016
Michaella Wahl receives the Farmway Ag Career Scholarship
from Art Duerksen.
Mallory Wittstruck presents MacKenzie McPeak with a Farmway
Producer-Member Scholarship.
Cody Hauschel presents Tanner Kubick with a Farmway Producer-Member Scholarship.
Art Duerksen presents Brenton Edwards, son of David Edwards, a
Farmway Employee Scholarship.
Parker Gates, son of Brian Gates, is awarded the Farmway Employee Scholarship by Art Duerksen.
Ryan Diederich and Steven Lilley awards Katelyn Bohnenblust the
Farmway Producer-Member Scholarship.
Mallory Wittstruck presents Haley Waddell with the Ronald &
Phyllis File Memorial Scholarship.
Luke Hesting, son of Janet Hesting, received the Farmway Employee Scholarship.
THE COOPERATIVE ADVANTAGE
13
Consolidated Balance Sheets as of January 31, 2016 and 2015
Assets 2016
Current Assets
Cash
Marketable Equity Securities
Accounts Receivable - Trade
Margin Account
Inventories
Prepaids
Deferred Income Tax Benefit
$
Total Current Assets
Total Investments
604,047
25,327
15,156,571
2,886,867
132,826,344
8,714,700
52,716
$
2015
737,337
19,521
18,498,512
----
125,891,422
5,563,976
49,236
160,266,572
30,519,530
150,760,004
23,523,490
Fixed Assets
Buildings and Equipment, net of
Accumulated Depreciation
Total Other Assets
47,458,307
1,812,538
47,877,959
2,068,047
Total Assets
$
$
224,229,500
2016
2015
Liabilities and Members’ Equity
Current Liabilities
Current Maturities of Long Term Debt
Notes Payable - Seasonal
Payables
Accrued Expenses
Patronage Dividends Payable
$
Total Current Liabilities
Total Long-Term Liabilities
Deferred Income Taxes
240,056,947
10,110,886
78,199,363
56,939,542
935,226
560,000
$
8,950,788
59,125,950
68,159,469
910,271
1,500,000
146,745,017
138,646,478
30,560,095
26,208,185
----
----
1,426,900
14,844,858
13,960,509
12,983
26,070,018
6,436,567
1,248,390
15,413,536
13,679,239
7,176
23,614,989
5,411,507
62,751,835
59,374,837
Members’ Equity
Memberships
Revolving Funds
Non-Qualified
Accumulated Other Comprehensive Income
Retained Savings
Minority Interest
Total Members’ Equity
Total Liabilities and Members’ Equity $
240,056,947
$
224,229,500
Board Chairman Tim Porter presents plaques to retiring board members Rick Chaffee of Clay Center and Chase Larson of Belleville at
the 105th Annual Meeting in Beloit, May 5.
14MAY/JUNE 2016
Statements of Operations Years Ending January 31, 2016 and 2015
2016
Sales
Gross Sales
Cost of Sales
$
389,021,882
355,113,608
2015
$
33,908,274
Gross Margins on Sales
Other Operating Income
426,417,183
396,309,830
30,107,353
13,110,977
2,633,313
994,263
201,648
5,567,601
2,805,725
1,077,692
211,272
2,592,553
1,319,976
7,726,318
2,825,449
20,852,730
54,761,004
20,214,057
50,321,410
15,274,353
10,796,246
18,365,076
15,190,812
11,145,674
12,398,603
44,435,675
10,325,329
38,735,089
11,586,321
2,400,711
55,506
----
2,414,707
307,835
(43,752)
Total Other Earnings
2,456,217
2,678,790
Earnings Before Income Taxes
12,781,546
619,959
(9,960,145)
14,265,111
(397,095)
(6,675,725)
Grain Income
Crop Production Service Income
Trucking Income
Finance Charges and Interest
Gain on Concordia Terminal LLC, and
Ag Solutions IT LLC Contribution
Other Income
Total Other Operating Income
Gross Income from Local Operations
Operating Expenses
Personnel Expenses
Fixed Expenses
Other Operating Expenses
Total Operating Expenses
Earnings from Local Operations
Other Earnings
Patronage Dividend Income
Investment Income -LLC’s & Other
Gain (loss) on Sale of Marketable Securities
Income Taxes
Minority Interest
Net Earnings
$
3,441,360
$
7,192,291
The amounts were derived from the January 31, 2016 audit report, which is on file
at the administrative office. These statements do not contain all of the disclosures
considered necessary to be in accordance with U.S. Generally Accepted Accounting
Principles. A short form audit containing all of the necessary disclosures is on file at
the administrative office. The 105th Annual Report can be found online.
293 Members and guests attend the 105th Annual Meeting at St.
John’s High School in Beloit, May 5th.
Farmway CEO Art Duerksen presents the cooperative’s financials
and 2015-2016 activities at the Annual Meeting.
THE COOPERATIVE ADVANTAGE
15
PO Box 568
Beloit KS 67420
There’s a time when
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Lee Parker
Farmway Co-op, Inc.
Vice President of Petroleum
Contact your local agronomist at Farmway Co-op
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www.farmwaycoop.com | 785.738.2241
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