AgCredit Leader, December 2022

Message from the President Webinars, conferences and podcasts highlight

a busy AgCredit calendar for 2023

BY BRIAN RICKER, PRESIDENT

If you’re like me, you begin to think and plan for what the new year will bring as the current year winds down. For AgCredit, we have several exciting, value-add events scheduled over the next several months that I’d like to share with you.

Webinars

The conference will feature a great mix of guest speakers, as well as our own AgCredit experts. One highlight will be a half-day bus tour to several local farms and ag businesses. A panel discussion with local farmers is also planned. Our YBS Committee has been hard at work planning this event, and we’re looking forward to sharing more details soon. Be on the lookout for registration information over the next few weeks!

Podcasts

BRIAN RICKER

One thing the pandemic showed us is that webinars are an efficient and effective way to get expert advice out to a wide audience. I’m delighted to report that AgCredit will host several webinars during the months of January and February. Here’s a snapshot of our event topics and speakers:

“Budget and Market Outlook,” Jan. 11 – Barry Ward

Barry is a leader for production business management and director of Ohio State University’s Income Tax School for the OSU Extension. He’ll share information on business tools and analysis that can help producers better manage their farms.

“Grain Marketing Outlook,” Jan. 18 – Bailey Elchinger

Bailey is a risk management consultant & regional director for StoneX Financial. She’ll provide a grain marketing outlook to help with planning and marketing of the 2023 crop.

“Weather Outlook,” Feb. 15 – Eric Snodgrass Nutrien’s principal atmospheric scientist will take a deep dive into weather patterns for 2023. Eric has a reputation of being able to explain weather in a way that makes the information both digestible and actionable.

Registration information for these online events can be found within this issue of the Leader. If you’re not able to attend our live webinars, we’ll also record them and post them on the AgCredit website.

YBS Conference

Another exciting event on the 2023 calendar is our first conference for Young, Beginning and Small (YBS) farmers. Topics to be covered during the March 17-18 event include understanding balance sheets, branding your farm and grain marketing. This is a great networking opportunity you won’t want to miss!

Last year we launched the “AgCredit Said It” podcast and, after producing 20 episodes, our team is back at it working on Season 2.

Our second season kicked off in October with a motivating conversation with Zippy Duvall, president of the American Farm Bureau Federation. Since then, we’ve also covered contract swine barns, the importance of meeting with your tax accountant and basics of credit.

New episodes of “AgCredit Said It” are released on the first and third Mondays of each month. If you’re new to podcasting, you can listen to the show using an app like Apple Podcasts or Spotify. Once you have the app, you can subscribe to receive notifications when we release new episodes. You can also visit our website to listen and read the notes from each episode.

Annual Meeting

Our Annual Meeting is set for March 29 at the Hancock County Fairgrounds in Findlay, Ohio. I hope you’ll join us for a great meal, entertainment, a short business meeting and financial reporting on the Association. The $3 ticket price is hard to beat!

We here at AgCredit are very grateful for all our borrowers and for the relationships that have been built through the years. We hope the opportunities I’ve mentioned will be beneficial for you and your operations in the coming year.

We’re looking forward to sharing details about our Association’s financial results in early 2023 and distributing another patronage return with our members. Until then, we wish everyone a safe and joyous holiday season!

PRESIDENT - Brian Ricker

BOARD OF DIRECTORS

Dustin Sonnenberg, Chairman

David Conrad, Vice Chairman

Gary Baldosser

Scott Chalfin

Kevin Flanagan

Fred Pond

Daniel Rengert

Scott Schroeder

David Stott, Ph.D. Michael Stump

Michael Thiel

EDITOR - Kayla Laubacher

Address changes, questions, comments or requests for copies of

financial reports should be directed to AgCredit, ACA by writing 610 W. Lytle Street, Fostoria, OH 44830, or calling 800-837-3678. Our financial reports can also be obtained on our website: www.agcredit.net

IMPORTANT DISCLOSURE

FIELD NOTES

Six Tips for Young, Beginning and Starting Farmers from

Zippy Duvall, American Farm Bureau President

BY KAYLA LAUBACHER, MARKETING COORDINATOR

As president of the American Farm Bureau Federation, Zippy Duvall has helped shape a new farm bill, defeated misguided regulations, shepherded new trade agreements, and ensured farmers and ranchers are supported through natural disasters and the ongoing impacts of the COVID 19 pandemic. Podcast hosts, Libby Wixtead and Phil Young had the opportunity to interview President Duvall to kick off season 2 of AgCredit Said It

In the episode, President Duvall shared his background in agriculture, from growing up on a dairy farm to his career path leading to American Farm Bureau where he plays an important role in advocating for and promoting American agriculture. Along with sharing some of the top issues facing agriculture right now, President Duvall also gives some of his top advice for young farmers. Here are the six tips President Duvall shared:

1. Diversify

“My first decade farming was during the eighties,” says Duvall. “Back then, the secret to me staying in business was being able to be diverse.”

Duvall says diversification still holds true for today’s young farmers. Thinking outside of the box can take your business to the next level.

As creatures of habit, Duvall explains that it’s easy for young farmers to want to do what their fathers and grandfathers did. “We can’t do that anymore and survive,” says Duvall.

2. Own a piece of equipment with another farmer

As a first-generation farmer, availability of land is one challenge, and if you’re just starting out, availability of credit is another.

Borrowing money to purchase equipment may not be an option, but partnering with a neighbor to own a piece of equipment together is one of the ways Duvall says young farmers can combat the challenges that they face when beginning to farm.

3. Get involved

President Duvall also stresses the importance of budgeting some time to be involved in a membership organization, such as commodity groups and local farm bureaus.

“We need current policy [in Washington, D.C.],” says Duvall.

Without young farmer involvement, Duvall explains that their voice wouldn’t be heard when it comes to important agriculture topics they want to advocate for.

4. Take care of yourself

Young farmers are busy on and off the farm and we’ve seen growing concern for mental health in agriculture across the country.

“Stay focused, take care of your family, take care of yourself,” says Duvall.

5. Find a mentor

“Go find someone that’s already tried that, that’s got a little experience, and pick his brain,” says Duvall.

Building a relationship with an experienced farmer is a valuable asset to have to continue to learn and grow.

6. Bring added value back to the farm

Many young people are coming back to the farm after college and they can bring added value with them.

In order to make a career out of coming back to the farm, Duvall says to “find something in their education that they could bring back to the farm so that farm could afford to have them there.”

Listen to the full interview with President Duvall on the AgCredit Said It podcast.

Undue influence claims can threaten the

family farm

BY RYAN CONKLIN, ATTORNEY, WRIGHT & MOORE LAW CO., LPA

The passing of a loved can be heart-wrenching for family members, and strong emotional responses can be compounded when someone is unhappy with an estate plan. Farm estate plans are ripe for these concerns since they often favor farming heirs.

Frequent visits to a lawyer, sudden changes to a plan, spending too much time with a loved one and other activities can raise alarms within a family. In some instances, these issues evolve into a formal legal dispute, and the primary argument is undue influence.

At first glance, these seem like provable points. A son or daughter took care of a parent for years, took the parent to all legal appointments and the estate plan was changed in his or her favor. It sure sounds like undue influence to me!

Unfortunately, proving these points in a lawsuit is very difficult. For example, if the will-maker retains capacity, showing they were susceptible to undue influence becomes a challenge. Furthermore, gathering evidence that a person attempted or exerted undue influence after a party has passed away can be tough. To build a strong case, collecting evidence as it becomes available is the preferred path.

RYAN CONKLIN

An undue influence action is filed if an individual believes that the free will of a person executing an estate plan was compromised. The complaining party needs evidence to show that a third party influenced a person to draft a will in a particular manner.

To prevail in an undue influence case, complainants must prove:

• That the will-maker was susceptible to undue influence.

• That the influencer had opportunity to exert undue influence.

• That improper influence was exerted or attempted.

• The effect of the undue influence.

The remedies a party can seek are another key part of the analysis. If an undue influence action is successful, it would invalidate the instrument that contained compromised decisions. With a will or trust invalidated, the new estate plan for the deceased is their last will or trust. Depending on prior documents, setting aside a will or trust may change very little in the decedent’s plan.

Lawsuits involving an estate plan can carry tremendous risk. A will or trust containing a contest clause can result in a forfeited inheritance if a lawsuit is filed. Before filing such a suit, gathering extremely strong evidence is strongly recommended to avoid losing all possible inheritance.

Counsel from an attorney familiar with undue influence cases is strongly recommended. Such cases are extremely difficult to win, and investing resources in a fruitless endeavor is ill-advised. More importantly, the fractured relationships that can result from these actions are usually tragic. Maintaining family bonds is almost always a preferred outcome.

USDA announces details for the 2022 Census of Agriculture

BY DAVID WHITE, FINANCIAL SERVICES AND GOVERNMENT RELATIONS ACCOUNT MANAGER

Farmers and ranchers throughout Northern Ohio will soon have the opportunity to be represented in the nation’s only comprehensive and impartial agriculture data for every state, county and territory. The U.S. Department of Agriculture (USDA) will mail the 2022 Census of Agriculture to millions of producers across the 50 states and Puerto Rico at the end of this year.

about agricultural research, beginning farmer programs, conservation programs, new agricultural technology, production practices, rural economic development, telecommunications connectivity, transportation, marketing locations and more.

The census gives farmers and ranchers a voice. Completing and submitting the census is an opportunity for every producer to tell how American agriculture provides food, fuel, feed and fiber to the world. Participating is also a way to influence decisions that will shape the future of operations, communities and ag-related industries. All voices will count — from the smallest producer to the very largest.

DAVID WHITE

Conducted every five years by the USDA’s National Agricultural Statistics Service (NASS), the Census of Agriculture tells the story of U.S. agriculture by highlighting land use and ownership, producer characteristics, production practices, income and expenditures, and a range of other topics. This year’s census includes new questions about the use of precision agriculture, hemp production and hair sheep. There are also updated questions regarding internet access.

Farm operations of all sizes that produced and sold $1,000 or more of agricultural product in 2022 are eligible to participate. This year’s survey period begins in November, when respondents are invited to participate online. A paper questionnaire will be mailed in December. The deadline to complete the survey is Feb. 6. The NASS expects to release results in the spring or summer of 2024.

Census responses provide valuable information for agricultural planning and decision-making at all levels of government. The information is used to develop short- and long-term improvements, strategies and safeguards for farmers and ranchers. Results also play a role in determining future public policy decisions

To learn more about the Census of Agriculture and to view previous years’ census data, visit www.nass.usda.gov/AgCensus

USDA expands insurance coverage for double cropping in 2023

BY CALEB DOUCE, DOUCE AGENCY, LLC

The U.S. Department of Agriculture (USDA) is reducing the economic risk of raising two crops on the same land in one year, making it easier for farmers to grow food, increase the food supply and lower food costs in response to global shortages related to the invasion of Ukraine.

What counties are included?

There are three zones indicated on the map.

Gray: Counties that don’t have coverage for double cropping.

Blue: Counties that already have double cropping insurability.

CALEB DOUCE

What is the double cropping initiative? To reduce the risk of raising two crops on the same land in one year — a practice known as double cropping — the USDA’s Risk Management Agency (RMA) has expanded double crop insurance opportunities in more than 1,500 counties across the nation. The goal of the initiative is to increase food production by increasing the number of counties where soybeans and grain sorghum planted for harvest following another crop in the same crop year is an insurable practice. While this practice is already insurable in some areas, this initiative will expand insurability by reducing history requirements, offering blanket written agreements and offering these agreements in new areas. Double cropping — as well as first and second crop provisions — still apply, but the initiative makes insuring the second crop easier.

What is a written agreement?

A written agreement is an individually underwritten insurance policy that can be requested through your crop insurance agent and is issued through the RMA. Keep in mind that written agreements cannot provide coverage for separate enterprise units by cropping practice, Trend Adjusted APH, Supplemental Coverage Option or Enhanced Coverage Option.

What are the basic requirements to qualify?

This initiative requires proof of three years’ experience in double cropping to qualify for a written practice agreement. Under the initiative, this requirement may be reduced in counties with adequate moisture, growing degree days and double crop experience.

Green: Counties where double cropping coverage is available via written agreement but a history of double cropping is waived.

For more information, visit https://www.rma.usda.gov/News-Room/Frequently-Asked-Questions/DoubleCropping---Expanded-Insurance-Coverage. If you have questions about your area, requirements or the initiative in general, please reach out to your crop insurance agent.

How much house can you really afford?

A good budget will provide the answer

BY MANDY STACY, RESIDENTIAL LENDING BRANCH MANAGER

Throughout my 17-year career working with residential borrowers, the first question I’m usually asked during our initial meeting is, “How much house can I afford?”

While residential loans have a simple repayment ratio and credit score analysis that’s proven to be effective, the variable that can’t easily be factored into the equation is a borrower’s day-to-day living costs.

The reason for this is simple: While I could approve you for a certain loan amount, that doesn’t necessarily mean you can afford the monthly payment. If you don’t have a budget to track your household and personal expenses, you really have no idea what it costs to live. If you don’t have a budget, how are you managing the dollars you work so hard to earn? Business success depends on operating within a budget, so it only makes sense that households should operate in the same fashion. For this reason, I recommend that households create and stick to a realistic budget at the beginning of each year that includes a built-in savings and investment line item.

An in-depth budget should include how much money is allocated for entertainment, gifts, restaurants, clothing and travel. Budget tools can range from simple Excel spreadsheets to mobile apps you can use on your phone that help you track and categorize each expense. The key is to find the tool you’re most likely to use on a consistent basis.

The next step is ensuring that everyone in your household is onboard with sticking to a budget and committed to working toward a common goal — one that has tangible benefits. If you haven’t created a household budget before, I suggest you brace yourself for some eye-opening surprises. As we review consumer credit

reports in loan analysis and see large amounts of credit card and consumer debt, the tough budget conversations far outweigh the results of living without a budget.

One question you may be asking is this: How much of my monthly budget should be allocated to a mortgage payment? We at AgCredit recommend that your monthly housing principal and interest payment, real estate taxes and homeowner’s insurance should not exceed 28% of your gross income.*

Your next question may be: How much total debt can I have and still be eligible for a home loan? This is a much tougher question to answer because total payments ratio guidelines can vary from one loan product to another. In general, however, we recommend that your total payments ratio, which includes your housing P&I payment, real estate taxes, homeowner’s insurance and any additional installment debt and credit card debt, should not exceed 36% to 39% of your gross income. Again, it’s important to note that these are guidelines. Only you know how much money you spend on non-installment-debt for things like cell phones, gas, entertainment, utilities, food, health insurance and medical costs.

As you review your personal finances, you may realize that your housing or total payments ratio is out of line. If that’s the case, look for opportunities to begin making informed budget decisions so you can contribute more dollars to installment debt or your mortgage payment to reduce those ratios.

My overall advice is this: Have those difficult conversations, make the tough decisions and take control of your money! You won’t regret it. As the financial guru Dave Ramsey says, “You’ve got to tell your money what to do or it will leave.” The advantage of working with one of AgCredit’s specialized residential loan originators is that we’re happy to discuss repayment ratios and finding terms that will best fit your needs. We’re invested in helping you achieve your long-term goals and success!

* The ratio calculation mentioned above using gross earnings is for W-2 earnings only. Self-employment income is based on a two-year average of net income plus depreciation and interest for each scheduled income tax form (ex. Schedule C – business, Schedule F – farm, Schedule E – rental).

Additional factors taken into consideration on a residential loan approval: Employment history, credit bureau score/repayment history and assets.

MANDY STACY

Year-end loan payment and tax pointers

BY JANICE KOHLS, LOAN OPERATIONS MANAGER AND DAN LUCKE, CONTROLLER

As the holiday season approaches, year-end is just around the corner. With each year-end comes the task of deciding in which year to make loan payments for tax planning. Following are tips to keep in mind to help you as you plan.

Form 1098 – Mortgage Interest Statements

Shows interest paid for any loan secured by real property and made to a person (an entity using a Social Security number). Any interest refinanced or paid with funds from another loan is not reported.

Form 1099-INT – Interest Income

Shows interest of $10 or more earned on funds in escrow (funds held) and/or Voluntary Advanced Conditional Payment Account (VACP or Reserve Account).

Form 1099-DIV – Dividends and Distributions

JANICE KOHLS DAN LUCKE

Loan Payments

• AgCredit branches will close 2022 business at 12:00 p.m. on Friday, Dec. 30.

» Payments received after this time will be credited in 2023.

» We encourage you to make payments before Dec. 30 and specify how you would like them applied.

» Please consider mail time. Payments are effective when they are received and not by the check or postmark date.

• AccountAccess payments prior to the daily cutoff time will post to your account the next business day.

» The cutoff time is generally 2:30 p.m., but it may be earlier. AccountAccess provides the actual cutoff time.

• You can pay all or a portion of your accrued interest in 2022 and get credit for 2022.

» The staff at your local AgCredit branch can help you to determine the amount.

• You can pay your Jan. 1 mortgage loan payment before the close of business in 2022 and get credit for the interest in 2022.

» You cannot use escrow (funds held) interest credit to pay a portion of the payment and get credit in 2022.

• Interest paid during 2022 on your loans secured by real estate will appear on IRS Form 1098, Mortgage Interest Statement or your annual statement.

• Consult with your tax preparer on interest deduction tax reporting.

Reviewing 2022 Payments Through AccountAccess

You can help ensure the accuracy of your loan transactions for 2022 through AccountAccess. Doing this before Dec. 30 will give you time to notify the office and allows time to make the changes in 2022. This will help ensure that your tax and other annual statements are correct.

IRS Informational Returns

We report informational returns under the person or entity listed as the primary borrower for the borrowing entity. Statements are available on AccountAccess in mid-January. Paper forms, along with your Member Summary Statement, will be mailed in late January.

Shows dividends of $10 or more earned on Class A Preferred stock.

Form 1099 PATR – Taxable Distributions Received from Cooperatives

Shows the amount of taxable patronage you received by either check or notice. Any patronage refund and disbursement of allocated equities is at the discretion of the Board of Directors. The taxable patronage for 2022 is your 2021 cash patronage that was distributed in late March or early April.

Member Summary Statements

AgCredit mails summary statements to each borrowing entity at the end of January, but they are available on AccountAccess in mid-January. These statements are informational in nature and are not sent to the IRS.

Your member summary statement shows beginning and ending loan balances, interest paid, fees paid, stock and allocated equity balances.

AccountAccess

You can conveniently manage your account information anytime from anywhere with AccountAccess.

• Free, 24/7 access to your account.

• Quicker availability of IRS tax forms and the member summary statement.

• Request draws on your line of credit and make loan payments.

• See loan balances, activity, interest paid, billing statements and more.

• Avoid late fees. Your payment is posted as soon as the next business day.

• Link up to three checking or savings accounts to make your payment.

Download our free mobile banking app to your smart phone from the Apple App store or the Google Play store. Search for AgCredit Mobile.

If you’d like to sign up for AccountAccess or if you’ve forgotten your password, please call 1-844-275-9534 or email AASupport@farmcredit.net

Finally, as we approach the end of the year, remember to jot down your inventories and other information to complete a balance sheet and income statement in preparation for the financial analysis of your business. If you need help with this process, contact your AgCredit team.

Thank you for choosing to do business with us! All of us at AgCredit wish you a joyous holiday season.

Allis Chalmers by Katie Snyder

Miss Reba by Samantha Walker

NW Ohio Wheat Harvest by Caleb Stoller

Happy Easter by Brittany Mantey

Beauty and the Bee by Anna Gest

Cow Kisses by Calista Altenburger

Born in the USA by Samantha Walker

Harvest Sunsets by Alek Bowersock

Feeding Time Friends by Tyler Rice

Loading the Planter by Callie Long

Whatcha Looking at by Keri Brown

Beautiful Barn View by Rhonda Cooper

MIKE KLEINKNECHT SUSIE MILLER

KAREN FREDERICK

Karen Frederick, Residential Lending Loan Specialist retired at the end of June after 41 years of service at AgCredit. Congratulations, Karen!

CAROL BRICKNER AMY BUSLER

HALLE MILLER

Halle Miller of Erie County is a sophomore at The Ohio State University studying Agribusiness & Applied Economics.

ETHAN STALEY

Ethan Staley of Richland County is a freshman at Northeast College (Wyoming) studying Ag Business & Marketing.

LILLIAN WAGNER

Lillian Wagner of Marion County is a sophomore at The Ohio State University Agricultural Technical Institue studying Agriscience Education.

Congratulations to our 2022-2023 Joe Leiser Memorial Scholarship recipients. Each student was awarded $3,000 to use towards their agricultural education.

BEC DIEMER

STEVE WEIHL

JEFF RICKENBACHER

LISA SHUMAKER

TOM HAGEMAN

RANAE SHERMAN

MELVA ROOF

2022 Mission Fund Recipients

Congratulations to our 2022 Mission Fund Recipients. This was the fifth year to distribute grants through the Mission Fund and we had a record number of applicants. We look forward to seeing the positive impact these projects will have on our local communities. Recipients were selected based on their proposals to meet criteria in one or more of four key areas: Education, environment, technology and quality of rural life.

Organizations may apply for Mission Fund grants of up to $15,000 per year. The 2023 application process will begin in March, and funds will be distributed by Dec. 31. For more information about the Mission Fund, visit AgCredit.net

Cardington Community Food Pantry, $5,000, Morrow County

Cardington Volunteer Fire Department, $5,000, Morrow County

Crawford County Agricultural Society, $9,000, Crawford County

Erie County 4-H Camp, $8,000, Erie County

Feichtner Memorial Swine Committee, $9,000, Huron County

Fort Jennings Volunteer Fire Department, $5,000, Putnam County

Hancock County Dairy Beef Youth Boosters, $4,000, Hancock County

Hancock Soil and Water Conservation District, $2,000, Hancock County

Kalida Volunteer Fire Department, $5,000, Putnam County

Lorain County Fair, $9,000, Lorain County

Mid-County Ambulance District, $3,000, Wood County

Mt. Gilead Fire Department, $5,000, Morrow County

New Riegel Volunteer Firemen, $5,000, Seneca County

Old Trinity Episcopal Church, $5,000, Seneca County

Ottawa County 4-H Advisory Committee, $3,000, Ottawa County

Parkway FFA, $5,000, Mercer County

Seneca County Junior Fair Goat and Sheep Department, $9,000, Seneca County

Seneca East Middle School Science, $1,500, Seneca County

Upper Sandusky FFA, $5,000, Wyandot County

Van Wert County Ag Society, $9,000, Van Wert County

Van Wert Soil and Water Conservation District, $1,000, Van Wert County

Wyandot County Advisory Council, $3,500, Wyandot County

Wyandot County Agricultural Society, $5,000, Wyandot County

Crawford County Ag Society

Lorain County Fair

610 W. Lytle Street Fostoria, OH 44830

2023 Outlook Webinars

Join us for our annual Winter Webinar Series in early 2023 to help move your business forward in the New Year. Pre-registration is required and webinars can be viewed from any computer, tablet or smart phone with internet access.

Budget and Market Outlook

Jan. 11, 2023, 7:00pm

Speaker: Barry Ward

Barry is a leader for production business management and director of Ohio State University’s Income Tax School for the OSU Extension. He’ll share information on business tools and analysis that can help producers better manage their farms.

Grain Marketing Outlook

Jan. 18, 2023, 7:00pm

Speaker: Bailey Elchinger

Bailey is a Risk Management Consultant & Regional Director for StoneX Financial. She’ll provide a grain marketing outlook to help with planning and marketing of the 2023 crop.

Weather Outlook

Feb. 15, 2023, 7:00pm

Speaker: Eric Snodgrass

Eric is Nutrien’s Principal Atmospheric Scientist and will take a deep dive into weather patterns for 2023. Eric has a reputation of being able to explain weather in a way that makes the information both digestible and actionable.

To register for the webinars, scan this QR code or visit www.AgCredit.net/webinar.