December 2019 Newsletter
Dec 01, 2019
A Message From President/CEO, Allan Zumpfe
The last quarter of 2018 and 2019 was a challenging time period for central U.S. agriculture and in many ways, one for the record books. From bomb cyclones to flooding, mother nature tested the Midwest producers’ resolve frequently. Your cooperative worked hard to serve our members and assist you to make the best of the year.
I am pleased to report your company performed very well financially this year despite the many obstacles that were faced. Total sales for the year were $750.8 million, generating gross revenue of $106.6 million and local savings of $13.2 million. $7.09 million was received from investments in our regional cooperatives and a loss of
$2.66 million was recorded from our partnerships, making savings before income taxes of $17.6 million. Income tax of $1.4 million was expensed, bringing the net savings for fiscal year end 2018/2019 at $16,234,381. Complete details of the fiscal year results will be presented at the annual meetings on January 14th in Crete and January 15th in DeWitt.
I would like to thank you for your continued support of Farmers Cooperative. We appreciate your business and the relationships we have with you, our member owners.
Going forward, we will continue to look for ways to add value to your operations and to better serve you. In other words, we plan to continue to “Invest In Our Owners’ Success!” Over the years your company has built a very strong balance sheet that allows us to stay current on age 65 equity redemptions and estates, as well as aggressively revolving the new equity that has been allocated since 2002 as all patronage earned through 2009 has been paid out. The goal of your company will continue under my leadership: to provide assets and people to serve you in the most efficient manner possible. We have plans to add more storage, purchase new rolling stock and invest in new technologies to assist you in any way we can.
I ask you to join me in thanking the employees of Farmers Cooperative for their hard work and dedication. They worked many long hours to make this the year it was for the company and for you. Without them, Farmers Cooperative would not be the company it is today!
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Fiscal year 21/22 proved to be one for the record books for your company. Record volumes of grain were handled as a result of the largest harvest handle to date during the fall of 2021. Along with extreme volatility for all commodities, this provided many opportunities for your company. Record prices for both grain and inputs were also experienced in 2022 as the Russia/Ukraine war shifted demand around the world for grains and fertilizers. As the war progressed and sanctions were put on by both sides, Euro Gas jumped to nearly $100/MMBtu, forcing nitrogen manufacturing facilities in Europe to shut down, allowing U.S. nitrogen producers to export to Europe keeping domestic prices in the U.S. firm. Thankfully Europe has had a mild winter this year with only five days having recorded temperatures below freezing so far, bringing gas prices back down, thus causing fertilizer prices to soften as most European nitrogen manufacturers are again producing products.