Pride Ag Resources News letter

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MANAGER’S DESK

Jerald Kemmerer CEO/GM I would like to keep you informed about new exciting and additional growth within your cooperative. As of the first of July, Pride Ag Resources has purchased the TMC ACE Hardware Store in Maize, KS. The store is located just south of 96 Hwy and Maize Road. It is a very nice building that is 10 years old with about the same square footage as the store here in Dodge City. The previous owner Tom Inkelaar and his wife have been in the hardware business for 45 years. Carl Varner a long time employee at that location has been hired as the store location manager and will report to Jack Lane.

The purchase of this store not only will benefit our current ACE Hardware stores, but the diversification allows us to put profit to the bottom line with nonpatronage based business. The store is in a good growth area, but it is also reachable by several smaller communities plus several producers

THIRD QUARTER 2011

or small land owners that live close by. Pride Ag Resources has been handling hardware and farm supply since the 1940’s, and it has been one of our successful core business ever since. The purchase of this store was approved by the board of directors and we have been going through the due diligence for several months to make sure that everything is in order to make the purchase seamless.

There have been several employees working together on this project, and I really appreciate their efforts and additional work load in making this project successful.

We have been operating it for thirty days now, and it has been meeting our expectations so far. If you are in the Maize area, stop in and take a look at the new store.

At the annual meeting I also announced the opening of a new store in Meade, KS. We have worked with the due diligence with

ACE over the last few months in making sure the size and service this store will be adequate to operate profitably. Because it is an ACE Branded Hardware, we have had a lot of additional paperwork to be filled out to meet their requirements. This has caused a slower than expected opening. We have remodeled the old store, and it is ready to receive the inventory. I appreciate Randy Ackerman, GM of Meade Coop, and their board of directors in this cooperative effort to provide a service to their members and community. We are still anticipating a last half August opening.

We could beat the drought stories to death, but without better farming practices, wheat harvest could have been worse based on the lack of moisture. We received half of last year’s volume but it was 72% of our normal wheat crop.

Looking forward, we anticipate very few dry land bushels and limited irrigated bushels of fall

Inside This Issue 2 Safety - Ace Hardware 3 Grain 4 Feed - Agronomy 5 AV Energy 6 Seed 7 IT Department – Board of Directors

crops. A major concern is we are less than 60 days from planting our 2012 wheat crop and we have little or no topsoil or subsoil moisture.

The new Saddle Road facility is almost completed, and we are still looking for a September 1st completion day. With the dry weather, corn harvest is coming on quicker than anticipated but hope fully we can finish it even before that. I hope you have a safe and better than expected fall harvest.

Thank you for your business. It is always appreciated!

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Safety Division

Skyler Hayes Safety Director In the United States 700 people, on average, die from the heat each year. This makes hot weather one of the leading weather-related causes of death. The summer of this year will go down in the record books as one of the hottest on record. Following is useful information for those going outdoors during hot weather.

Keep exposure to the sun at a minimum. Overexposure to the sun is the leading cause of skin cancer and also causes premature wrinkling of the skin. If you must go outdoors, especially between the hours of 10:00 AM and 4:00 PM, protect yourself from over exposure to the sun. Wear clothing that will shield you from the sun, such as a long sleeve shirt and a wide brim hat and wear sunscreen with an SPF of at least 30. Remember that a cloudy sky will not protect you

from harmful UV rays. It is possible to get a sun burn during cloudy weather.

What is the difference between heat exhaustion and heat stroke?

Heat exhaustion is when the temperature inside the body rises above its normal temperature of 98.6 degrees. When the body temperature rises above normal, the levels of water and salt in the body begin to drop. When this happens, symptoms such as nausea, faintness and heavy sweating can occur.

Heat exhaustion, if left untreated can lead to heatstroke. Heatstroke happens when a person’s body temperature rises above 104 degrees F. When this happens cells inside the body begin to break down, and some organs of the body stop functioning properly.

Symptoms of heatstroke include mental confusion, hyperventilation and loss of consciousness.

Heatstroke is much more severe than heat exhaustion and is a medical emergency. If heatstroke is not treated properly it can cause organ failure, brain damage and death.

It is best to avoid heat exhaustion and heatstroke. When you are exposed to hot weather you can do several things to help prevent getting heat exhaustion or heatstroke. Drink plenty of water.

It is better to drink water than sugared drinks, coffee or alcoholic beverages. Take plenty of breaks to allow your body to cool itself. If at all possible avoid working or playing during the hottest time of the day. Keep in mind that, although heat exhaustion or heatstroke can affect anybody, it usually affects the elderly, small children (including babies) and those with certain medical conditions such as heart disease.

There are treatments for both heat exhaustion and heatstroke. If one shows the signs of heat exhaustion, move that person to a cool location, give him plenty of liquids to drink (once again avoiding caffeine or alcohol), cool

the skin with cool water and loosen unnecessary clothing. If the person with suspected heat exhaustion does not recover within 30 minutes, treat him as if he had heatstroke.

Treatment for heatstroke includes calling 911. While you are waiting on the ambulance you should do other things to help the victim such as moving the victim to a cool place, increasing the air supply with a fan or open window, giving water to the victim (if he is conscious), cooling the victim with cool water (above 60 degrees F.), gently massaging the skin to increase circulation, moving nearby objects if the victim is having seizures, and, if the victim is unconscious, turning him onto his side and clearing his airway.

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ACE HARDWARE

Jack Lane, Ace Manager The new Maize store is coming along nicely. The staff there has been busy cleaning and remerchandising the inventory. We will be doing the computer change over hopefully in a few weeks. If anyone is in the Wichita area they should stop in and visit the store and friendly staff. The address is 5204 N. Maize Road in Maize.

We are still working on the Meade location. Most of the improvements are finished at that location. We submitted an open stock order on Friday July the 29th.

We are working on getting the 2

shelving in place and waiting on some final networking to the system to tie Meade, Maize and the Dodge City Ace stores together.

The “post wheat” harvest and “pre fall harvest” era can be super exciting and is always an exciting time of the year to be around the Grain Department. Normally we are moving train after train or truck after truck to make space for the fall harvest. Things are a little different this year, sure makes us reflect how good we have had it over the past few years. There is no doubt this weather has us all in a tough spot. Producers are worried about filling contracts, end users worried about making it until corn comes out of the field. Elevators are all concerned about filling up their bins which leads to some impressive cash basis improvements.

was about 69% of a 5-year average.

Our average test weight was a shade over 60.5 lbs and the moisture of course was very dry.

This crop will store away nicely until spring. The world wheat situation at the current moment is all in Russia’s hands. They have been selling wheat like they plan on never running out. Russia had placed bans on exports since last August after a crop disaster, but it appears that the crop demise might have been overstate with a buildup of stocks now available. The worst problem is they are selling it cheap, very cheap, and so cheap that we have not gotten any wheat export business for some time now.

Recent sales to Egypt have Russian wheat priced nearly a $1/bushel below US wheat offers. The export business is much like the Kansas weather “give it a little time and the situation will change”. Harvest is progressing north and a decent pace. Nebraska is about done with harvest and S Dakota is about 75% done with harvest. There crop is running into some lower protein quality wheat, which will hopefully give our Kansas crop more demand to the mills. I’m hearing a lot of people getting very nervous about planting wheat. I can’t blame them, but we do have a few marketing ideas to minimize the production risk yet capture some of the pricing opportunities. Instead of guaranteeing bushels for delivery consider an option. I know they are “so expensive”; but when looking at them from % standpoint are they? Keep in mind, when you buy a Put you are protecting $8 futures.

For producers with “dry land” production out there that should be a dream come true. To lock in a higher than average futures price WITHOUT guaranteeing delivery!

Call you broker to find out more.

Given the spring/summer weather, we can’t be too disappointed in the wheat crop we had this year. Going into harvest I was nervous about what to expect with the lack of moisture this winter and spring. However it turned out to be a middle-of-the-road crop, it

It’s amazing how things can change from one year to the next.

Last year at this time we were settling in a monster wheat crop and getting ready for a healthy fall crop. Space was tight, basis was cheap, and we only had a hand full of days above 100 degrees. Now

I would like to thank everyone for their patience as we go through this transition. As always we thank you for your patronage.

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GRAIN DIVISION

Troy Presley Grain Merchandiser

there is more space available than we have had in over 4 years. Corn basis is at historic levels, and trying to climb higher. We have had so many 100 degree + days I have lost count. So what does that mean for the SW Kansas farmer? Well with extra space available you should see a push in the basis. I would expect basis levels to remain firm through fall harvest. To capture the strong basis in the corn market you might decided to sell some cash bushels, don’t neglect the Call spreads as a valuable option to protect against additional futures risk. Many people are only expecting 40% of a normal crop. If that holds true I would expect to see corn shuttles coming back in to SW Kansas from other corn producing states. With plenty of space, good demand for corn, and a tight supply. That has firm basis written all over it! As for the futures price, well that will probably be as unpredictable as ever. We continue to see the outside markets and “investment money” shove this corn market around. Open interest had declined in corn, potentially reflecting a certain cautious behavior from funds given the current economic outlook. There are too many tribulations with US debt and other world financials right now for investment firms to be spending big money in the AG sector. However if you look at how tight our supply of corn will be next year it can make a person get bullish very quickly given the current condition of corn. To many unknowns to make an erudite guess I think. If anybody tells you they know “how high” corn will get, that’s more smoke and mirrors than Congress gives us. Truth is, we need to think about harnessing this volatility, and things are too grim out here to be guaranteeing delivery on crops.

There is too much risk NOT to have a floor in place on our crops as well. I would like to see everybody have a floor in place on their bushels but yet put themselves in position to take advantage of any unforeseen rallies. It is very 3

possible; call Patrice Howely or Troy Presley to find out how.

I would like to thank everybody for their business with wheat harvest and we look forward to seeing you this fall. Hopefully the fall harvest will be as pleasantly surprising as the wheat harvest was.

If you have any questions about your contracts or our policies, please call the main office and talk to the Grain Department. Please continue to pray for moisture!

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FEED DIVISION

Galen Frick, Livestock Advisor

Early-weaning factors to consider With the hot, dry summer currently being experienced in many parts of Kansas and other states, traditional weaning plans may need to be significantly altered. Cows are out of grass in many areas, and grass is extremely short in others. Early weaning calves should be strongly considered, says Larry Hollis, DVM, MS, Kansas State University.

Hollis says to consider these factors when early weaning: ·

Water: Freshly weaned calves need plenty of fresh, clean water, especially if weaned during the heat of summer. Hopefully they have had access to water alongside their mothers, but if their mothers are drinking from an elevated tank or

tub that calves cannot reach, they may need to be provided with a readily-available, closer-to-theground water source so that they are trained to drink from it prior to actual weaning time.

Weaning method: Research has shown that “soft” weaning methods such as fence line weaning or nose clip weaning result in better maintenance of existing calf weights or subsequent calf performance than traditional “hard” weaning methods (abruptly separating cows and calves and placing calves in a dry lot or unfamiliar pasture situation). When calves are weaned with either soft method, calves have the benefit of knowing their way around the pasture, including where shade, water and feed are located. If facilities permit (calf-proof fences between 2 adjoining pastures), fence line weaning is preferable over nose clip weaning because it does not require running calves through the chute twice to install and remove the nose clips. Hard weaning methods always result in greater calf weight losses than soft methods. Also, hard weaning, especially when calves are weaned in dry, dusty pens, almost always results in more respiratory health problems.

Vaccination program: If some of the better calves need to be held for replacements, or calves are typically marketed through a valueadded preconditioning program or marketing system, they will benefit from the same preconditioning and vaccination program that would be utilized if they were held until normal fall weaning time. Feeding programs following weaning need to be adjusted to meet the needs of these lighter calves. When processing calves during the hot summer, be careful to make sure that vaccines are handled properly, because heat can spoil vaccines rapidly if they are not kept refrigerated during transit and chute side while working calves. If modified live virus vaccines are used, it is imperative that they also

be protected from sunlight. Over 60% of viral particles in the bottle or syringe will be inactivated by only 1 hour of exposure to sunlight.

Keeping the vaccine bottles and syringes in a cooler except when animals are actually being injected will help protect the product from both heat and sunlight.

Working cattle: Try to gather cattle into loose grass traps or large pens near the working facility where they have plenty of space prior to being worked. If possible, this should be done the evening before working the cattle. Try to have all work completed by 10:00 in the morning. Also, fresh water needs to be available both before and soon after working through the chute.

Date

Wheat Corn Milo Soybean

4/5/11

8.45

7.13

6.72 12.63

5/3/11

8.03

6.67

6.25 12.62

5/18/11

8.48

6.95

6.51 12.78

6/23/11

7.20

6.48

5.92 12.33

Last Year –AUG., 2010 AVG.

5.79

3.74

3.42 9.81

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AGRONOMY

David Seymore Sales/Agronomist

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Weed control in Drought Stressed Conditions Weed control is important during drought. Low soil moisture increases the competition for water between the weed and the crop.

Therefore, weed control is even more important when water is scarce. Drought tolerant weeds, such as Kochia, Russian thistle, and field bindweed develop extensive root systems early and take advantage of limited water, making them more competitive and difficult to control than when soil moisture is adequate.

Herbicide performance will also change under dry conditions.

Efficacy of postemergence or foliage applied herbicides, particularly those that are translocated within the target weeds, is highly dependent upon active plant growth. Postemergence herbicides are less effective when weeds are stressed. Drought stressed plants produce thicker leaf cuticles (waxy covering), resulting in less herbicide absorption into the plant. Drought-stress affects many plant processes and growth, resulting in less movement of herbicide once it is in the plant, and less herbicide delivered to target sites, such as enzyme systems or growing points. Do not skimp on herbicide rates when treating waterstressed weeds. Generally, more herbicide is needed to control drought-stressed weeds. Also, certain herbicide formulations may be more effective on droughtstressed weeds. For example, ester formulations of 2,4-D generally perform better on stressed weeds than amine formulations. The addition of the proper adjuvant can improve control of drought-stressed weeds by improving herbicide coverage, retention, and uptake.

Herbicide adjuvants help overcome the weed leaf's resistance to herbicide penetration. The selection of the proper adjuvant can improve weed control under drought stress conditions. Individual herbicides may require different adjuvants for

best performance. Choose tank mixes that have compatible adjuvants under drought conditions.

A cultivation of row crops remains an option for weed control during dry conditions. Benefits would be minimal where weed control is satisfactory and the soil surface is not crusted. A shallow cultivation can effectively control small weeds and loosen crusted soil.

Separating grass and broadleaf herbicides will help prevent loss of grass control due to herbicide antagonism. Reduced herbicide rates are less likely to perform well under conditions of weed stress.

Dry soils after herbicide application can increase the chance of carryover. Soil moisture is essential for microbial and chemical breakdown of herbicides.

A period of dry soil conditions can reduce herbicide breakdown and cause injury to the following crop.

Weed control during drought conditions requires additional management and flexibility on the part of the producer. Herbicide programs and cultivation may need to be modified to provide acceptable weed control. Always read and follow herbicide label directions to maximize weed control and minimize injury to the current or following crop.

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AV Energy

propane needs. AV Energy will be sending out contracts shortly and for some reason if you don’t receive one, please give our office a call. The big question on all the propane users’ minds is what will the contract price be this year? I’m not sure the exact price, but I can tell you it will be higher than last year. The reason for the higher price is the propane inventory levels in the United States are not building to the numbers we need to see this time of year. One of the major reasons the inventory is not building is because the United States has the cheapest propane in the world, so we are exporting much more propane then we have in the past. I would recommend to you that once you receive your contract in the mail you fill it out and get it back to AV Energy. We only have a certain number of gallons of propane set aside for the contracts and once the gallons are gone contracting will be over.

Did you know the Propane Education & Research Council (PERC) is seeking a limited number of agricultural producers to help the propane industry demonstrate propane equipment in geographically diverse regions of the country? The goal of the Propane FEED (Farm Equipment Efficiency Demonstration) program is to introduce new propane-fueled equipment to the agricultural industry while collecting valuable feedback on the performance of that equipment in real-world settings.

PERC will provide a financial incentive to a limited number of producers who partner with PERC and purchase a new piece of propane equipment. The incentive will be paid directly to agricultural producers after they have purchased and taken possession of the equipment.

Chris Klein AV Energy It’s hard to believe but it is time to start thinking about your winter

Eligible Equipment includes: Propane Irrigation Engines

$1500-4 cylinders $2000-6 cylinders 5

$2500-8 to 10 cylinders Propane Mower

$2500 To find out more about this program go to www.agpropane.com/feed or call 888-235-4332.

Thank you for your time and for more information about AV Energy check out our web site www.avenergy.com, or call our office at 620-225-4994.

SEED DIVISION

Jim Halling jhalling@prideag.com 620-338-5506 Sales Aronomist In tough conditions it’s always harder to plan ahead to the next season. We are getting to the time of year to be looking at seed wheat and pre-plant fertilizer options. As with the rest of the area, our seed wheat production was down compared to years past.

Currently we have limited amounts of Armour, Tam 111, Everest and Endurance in bulk, and can bring in more varieties on request. This year seed is tight across the area so it will be good to place your orders early.

With hot dry conditions throughout the area, it is going to be very challenging to establish stands this fall. Be careful to watch planting depth and populations

when you start drilling. Take care to watch planting dates and be aware of Hessian fly issues. At our Howell location we have the option to treat the bulk seed leaving the facility in order to apply insecticide and or fungicide to eliminate insect and disease problems that may show up this fall. At Pride Ag we appreciate your business and wish you a successful fall in order to get a good start on next season.

United States Environmental Protection Agency Regulations Concerning Pesticide Shuttles Effective August 16, 2011 new Environmental Protection Agency regulations take affect concerning pesticide shuttles. The new regulations seek to provide sound stewardship practices and national consistency for pesticide labeling, container integrity, repackaging, and storage. The regulation also seeks to reduce the risk of cross contamination during the refill/repack process. All shuttles must meet DOT design, construction, and marking requirements. They must have oneway valves and or tamper-evident devices, seals, on all openings (other than vents). All shuttles will have to be inspected for cracks, warpage, corrosion, dents or other structural damage. They will have to be triple rinsed and pressure checked before they can be returned to service. No shuttles can be used that have not gone through this process. After the approved shuttles have been filled they will have seals attached to the appropriate locations. A refundable deposit of $700.00 will charged for each shuttle as it is picked up.

When the shuttle is returned with all seals intact the deposit will be credited. If a shuttle is not returned in a timely basis an additional charge could apply to cover the cost of the pump, meter and plumbing.

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EMPLOYEE CHANGES Steve Magette has retired at the end of July from our Dodge City location as Elevator and Feed Mill Manager. I appreciate the years of service and experience Steve brought to our company, plus 32 total years to the cooperative system. I wish the best for Steve and Melody as they start a new chapter in their life. With the retirement of Steve, this gave us the opportunity to place Bryan Brauer as the manager of the Dodge City Elevator and Feed Mill, and eventually being responsible for the Seed Department for Pride Ag Resources. Bryan is a graduate from K-State with a BS degree in Animal Science; has worked in local cooperative feed millselevators; worked six years with Farmland Industries as Animal Health Specialist; and has been in the industry for 26 years. He has worked in our Agronomy/Seed Department for the last 6 years.

Bryan is excited about the opportunity and is looking forward to his new position as part of the Pride Ag Resources team.

Retiring in July at Ensign are Diane Figger after 23 years of service and Rod Figger who worked 39 years. We held an open house on July 21st for them and wish them the best as they move to Florida. Julie Dirks who has been with us for 5 years and has moved from Mr. Tire to Ensign to cover the position that will be left from Diane Figger’s retirement.

In replacing Julie’s position at the Car Care Center, it was filled by moving Norma Fugit who has been with the coop for 11 years from the Fuel Center. We have also moved the bulk propane tank to the east side of Mr. Tire so propane bottles can still be filled.

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Jose Trevino has been hired as our new ACE Hardware Store manager in at Meade Kansas. Jose will report to Jack Lane and will be responsible for the daily activities at that store. He has already started working part time at the Dodge City store until the Meade store gets up and running. Also hired to help Jose is Pat Vest, a former employee of the store. We are looking forward to working with both new employees.

Saddle Road facility will be supervised by Ronnie Keeton, who has been with us for 14 years, and with the help from the rest of the team of employees from Ford. We will also be asking other employees from other Pride Ag Resources locations to also help as it will take a couple of years to figure out the logistics and the effect it will have on the coop.

In making this change, Todd Lawhon who has been with us for 6 years will now be branch manager of Kingsdown and will report to myself. I appreciate both gentlemen in stepping up and helping take on their new responsibilities in make sure Pride Ag Resources runs efficiently.

Patty Crouch, who has been with us for 3 years, was promoted to supervisor of the warehouse and will report to Ken Tompkins.

Ken Tompkins, 30 year veteran with the coop, will oversee and manage the Warehouse, Fuel Center, and Mr. Tire. I would also like to thank Patty and Ken for stepping up and taking on new responsibilities within the company.

IT Department

Richard Broz rbroz@prideag.com

Pride Ag Resources IT Manager

Pride Ag Resources would like to invite you to browse our website www.prideag.com.

This site is updated daily with local and national news. We try to inform you what is happing at our local branch locations.

The website will provide you information on our departments, coop news, employment opportunities. Use it to look at your local Grain and Overnight cash bids. (These prices reflect a 10 minute delay).

Our feature this month will be Patron Access.

Features: • Access your accounts 24/7, with the ability to view multiple accounts.

• Summary and detail information and the ability to print copies of A/R tickets.

• Grain tickets available when YOU have time (after daily Updates are complete).

Sign up to receive daily cash bids by emails and text messages.

Welcome to Patron Access!

As patrons of Pride Ag Resources, you will now be able to access your accounts receivable balances as well as individual invoices, grain receiving accounts, grain contracts, prepaid and booking balances, And equity balances. You will also be able to pull volume statements for the year.

Patron Access is located in the navigation bar on the left side of our Web site (www.prideag.com). If you are new to Patron Access, please choose “New Account Request.” When the information is completed and sent, an e-mail will be forwarded to the main office. We will set up the

accounts you requested and advise via e-mail when this is complete. After that, you simply sign on using your own username and password that you created. Only you have access to your accounts.

BOARD OF DIRECTORS Scott Mac Nair ........................ Chairman Tony Bleumer... .............. Vice-Chairman Larry D Scott .......... Secretary-Treasurer Steve Riegel .............................. Director Jeremy Derstein ........................ Director Butch Irsik ................................. Director Clint Hamilton ............................ Director Josh Koehn.…...........Associate Director Jeff Reinert…….…….Associate Director Jerald Kemmerer………………CEO/GM Debby Kennedy….......Newsletter Editor

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Pride Ag Resources

Published quarterly by the

PRSRT STD U.S. POSTAGE

Dodge City Cooperative Exchange

PAID

3rd Quarter 2011

710 West Trail, Dodge City, KS 67801

DODGE CITY, KS PERMIT #399

(620) 225-4193

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