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Promoting the business success of our customers and the rural community

Summer 2010




the bull, the bear and what they can tell us

to crop insurance in 2011 Economy and agriculture's new role

old techniques


new practices

in other parts of the “People world stand in admiration of American agriculture today �



Note Summer 2010 Published by:

GreenStone Farm Credit Services

2 Comments from CEO Dave Armstrong CEO Dave Armstrong's summer letter touches on 2010's earlier than usual crop planting, first quarter financial results and recent political maneuvers within Michigan's Ag landscape.

5 Market Outlook Ag Economist Bob Utterback provides insight into the 2010 commodities market and the delicate dance between the bull and the bear.

9 Directors' Perspective Hear three GreenStone Directors' thoughts on Michigan's changing economy and the role agriculture has to play in its evolution.

17 Guest Column Learn the tricks of good listening and how they can apply to your operations budget and management process.

It’s likely that many of you are asking a similar question about this time…what happened to the first half of 2010? It seems like just yesterday that we were entering the New Year and focused on shoveling snow and keeping out of the cold. Now, with summer in full swing, it’s time to get outside and enjoy the beauty that our region brings this time of year. The days are long, but they can also seem so short with so many activities being planned. During this busy time, we hope you can still find a few moments to enjoy the latest issue of Partners, which features information on new Crop Insurance changes, details of a national award for GreenStone’s marketing department, and a feature article on a local organization helping teach agricultural practices to other countries. Happy reading… and as always, your comments and ideas are welcomed.

11 Young, Beginning and Small Farmer Feature Richard Roosenberg of Tillers International, located in Scotts, Michigan shares its mission to preserve, study and exchange lowcapital technologies to increase sustainability and productivity of people in developing nations around the world.

15 Changes to Crop Insurance for 2011 Discover what the Risk Management Agency has in store for the new Common Crop Insurance Policy in 2011.

11 Summer Notes 3 News Update 8 Customer Appreciation 8 Candid Comments

This newsletter is published quarterly for the customers of GreenStone Farm Credit Services. Partners, P.O. Box 22067, Lansing, MI 48909 • 517-318-2290 •


From CEO Dave Armstrong

Off and Running– The 2010 crop year is off to an unusually early start with nearly all crops planted three to four weeks ahead of “normal.” Sugar beets, corn, and soybeans are all well ahead of plan with some corn and soybean acreage being held up, particularly in the southern portion of Michigan, due to rains in late spring. Frost nipped crops in some areas, but I have not heard of any reports of wide spread damage. The cherry and apple crops were also hurt, but it may be too soon to know the full extent of that damage. All in all, 2010 is off to a great start and has produced a great deal of optimism for the remainder of the year. Speaking of momentum, GreenStone’s first quarter results were significantly improved from the first quarter of 2009. Return on assets is significantly better than it was at this time last year. Part of this is a result of the Farm Credit System Insurance premium refunds we received due to the System reaching the secure base amount of insured debt to investors of system wide bonds, as loan growth slowed over the past 12 to 18 months. We have also been able to sell two acquired ethanol plants in which we held a participation interest for a gain on our investment that also helped bolster earnings. And, so far, our loan loss provisions have been more modest than the first quarter of 2009. Dairy and timber continue to struggle, while persistent unemployment continues to negatively impact many of our customers whose source of income is something other than farming. We continue to manage through these challenges and anticipate overall better earnings this year than last. As you may recall, my comments in the last issue of Partners addressed the need for all of us to be more engaged in the political process now more than ever given the number and impact many of today’s issues hold. An example of how focused efforts can get positive results was recently noted in the Michigan Senate. After a tremendous amount of work by a broad segment of agricultural industry members to heighten legislators’ awareness of the economic impact agriculture has on the state’s economy, the Michigan Senate took notice and recently passed the following items for the

Michigan Department of Agriculture that, in many cases, had either been cut or funded at substantially lower levels by the House and Governor in their proposed 2010-2011 budgets:

1. Added $300,000 in the General Fund to the Grain Inspection Program and rejected the proposed fee increase in the Dairy Inspection program.

2. Restored ALL General Fund money to the Migrant

Worker Housing Inspection Program even though the House had restored $400,000. The Governor had proposed increasing the inspection fee for this program.

3. Rejected the Governor’s proposal to move the

Michigan Agriculture Environmental Assurance Program to the Michigan State University Agricultural Experiment Station to save $586,500 and provided partial funding of $262,000, whereby the House only left a $100 placeholder.

4. Where the House had originally supported the

Governor’s recommendation to cut the Commodity Inspection Program by $379,400, the Senate rejected the cut and added $250,000 to the program.

5. Finally, the Senate restored $150,000 that the

Governor and House cut from the Right to Farm Program.

Overall, the current proposed MDA budget is 6.6% below the current year. However, the question that begs asking is would the Senate have taken the actions it did if those among us had not worked so hard telling our industry’s story and getting involved? I think not! There is obviously more work to be done as the Senate’s recommendations will likely Continues on page 4...

Summer 2010



News update

News Update Summer 2010 Dunk GreenStone’s CEO to help the FFA

GreenStone Farm Credit Services Chief Executive Officer, Dave Armstrong will be in the hot seat on July 20 as he climbs into a dunk tank during Michigan's Ag Expo to benefit the FFA. Warm up your throwing arm and stop by the GreenStone exhibit booth at lot #120 on First Street for a chance to drop Dave into the water.

Several of GreenStone’s executives have also “volunteered” to assume the dunk tank position throughout the show to see just how many Ag Expo attendees can put them in the water. There is no charge for trying; but each person will be limited to five throws in order to keep the line moving. Each time an official receives a dunking, the Michigan FFA Foundation receives a

donation from GreenStone. Stop in and have some fun for a good cause. The FFA benefit dunk tank will be open from 10-11 a.m., and 1-2 p.m. on July 20 and 21, and 10 a.m.12 p.m. and 1-2 p.m. on July 22 during the show. Participants should check in at the GreenStone exhibit tent. You can also register for a chance to win a $500 Tractor Supply Company gift card.

“I’m hoping for a hot day, clean water, and some accurate arms so come on over to our booth and show me your stuff. The more I’m in the water the more money we raise for FFA. GreenStone has always been a big supporter of FFA and this is just one more way we can help the kids.”

Ag Expo: July 20-22 3

Partners Summer 2010

–Dave Armstrong, CEO

News update

Springport FFA Named Best FFA Chapter in Michigan for Second Consecutive Year For the students of Springport High School, FFA is about more than just farming. One out of every three students is involved in the school’s chapter for reasons such as building teamwork and leadership skills, being active in the community, and supporting agricultural education.

In the Winner’s Spotlight GreenStone and the Michigan FFA Foundation recently received a National Agri-Marketing Association (NAMA) Best of NAMA award. The duo were presented the award in late April during the Best of NAMA national awards ceremony in Kansas City, Missouri, for the unique

“License to Lead” promotional brochure used to help promote the Michigan Agricultural Heritage fundraising license plate.

relations agency. In total, over 460 entries competed nationally for top honors out of more than 1,165 regional entries.

The in-kind creative concept and design work GreenStone provided to the Michigan FFA Foundation directly competed against several national companies who were each supported by an advertising or public

GreenStone was also a national finalist for its outdoor billboard, “United We Stand,” which was seen throughout Michigan and northeast Wisconsin during the spring of 2009. The brochure and billboard advanced to the national level after receiving a first and merit award, respectfully, at the regional level. This was the first year GreenStone earned top honors at the national Best of NAMA awards competition.

Recently named the best chapter in Michigan for the second year in a row, Springport’s FFA has also been ranked second in the nation. The student’s degree of involvement is well demonstrated by the 22 plus events the chapter hosts each year. Springport’s level of commitment and membership volume are accomplishments that deserve recognition. ...CEO Comments continued be declined by the House and differences sent to conference committee to be worked out. The point of this is that “we” can make a difference, but it takes a focused and collective effort by all to even get a chance at success. This small “skirmish” is only the beginning of what will likely be a long drawn out “war” as we fight to create a state we can all be proud of. Issues like this and many, many others need to be addressed, which is why the 2010 elections are so critical. GreenStone continues to work with a number of agricultural organizations in Michigan along with the Cooperative Network and other Farm Credit Associations in Wisconsin to provide our members with another voice in the political process. In order to increase our effectiveness, we recently created a Political Action Committee (PAC) to help fund candidates who we believe are “friends of agriculture” in Michigan. We have always contributed to the national Farm Credit System’s PAC, but primarily because of our federal charter, have never been as involved in state politics. Times are changing and we believe your association needs to be

GreenStone's Executive 

Vice President Jack Kelly (left) and Vice President of Marketing Jim Nowak (right) receive an award from NAMA in April.

more active on both a state and national level. The Farm Credit associations serving Wisconsin have had a state PAC in place for several years and we intend to be a greater participant in that portion of our territory as well. Over the next few weeks, we will be asking for your support of our PAC efforts. I understand that many of you may already give to other industry PACs and that’s great, but if you don’t or want to increase your efforts feel free to join the GreenStone PAC. Even if you are unable to contribute financially, please at least invest some time to get familiar with the candidates from all parties and vote for those who you believe will best represent your interests as well as those of our industry. Remember, primary day is August 3!

Dave Armstrong

Summer 2010



MArket outlook

Market Outlook

Summer 2010 By Bob Utterback

The corn, soybean, and wheat markets have been caught in a very tight trading band since February. This yo-yo activity between the bulls and bears is wearing on farm producers in regard to deciding what to do with their 2009 and upcoming 2010 crops. The following is a review of the primary fundamental factors affecting these markets; I hope it assists you with regard to how to move forward with the pricing of your production. The bull’s argument has merit longterm, but seasonally I believe there is a time limitation. Concern about how the European financial crisis (which has dominated the market for the last few months) will not be a long-term issue. The bulls are arguing that the crisis is over and it’s time to prepare for the economic rebound. China’s direct intervention to slow down their economy is only a temporary situation. The argument 5

Partners Summer 2010

goes since Europe’s problems are over and the U.S. economy is growing again, China’s growth will continue. Bottom Line: Essentially demand prospects, while short-term, are tempered; a “V” bottom is developing and good growth potential is shaping up for 2011 and beyond. Corn and Soybeans: The bulls also point to the weather. The argument goes something like this: The last two years have been really wet and

cool. Many are predicting the El Nino is weakening and the La Nina will intensify which is going to cause a midto late summer dry pattern for much of the southern and eastern Corn Belt. The bulls are arguing that corn yields could drop back to 157 and soybean yields to the 40 bushels/acre level. This would result in corn carryover closer to 1.1 billion and soybeans closer to 290 million, which is significantly below current trade estimates. Subsequently, the bull’s argument is hold firm since

MArket outlook

the white knight is coming and you will be rewarded for your patience as all the bears get blown out of the market. The bear argues the bull is living in fantasy land if he believes the European economic situation is over. While Greece is the current problem, the entire European Union has debt problems. Essentially, they are spending too much and there is little income growth. As they try to tax to pay for programs, their economy contracts further. In the end, massive cuts in spending will occur and higher taxes will send their economy into a protracted slow growth period. Just like throwing stones in a pond, the ripple effect will slow down the Chinese economy which is a big seller to Europe. At the same time the bear will suggest the U.S. economy is not contracting, but neither is it expanding rapidly. Granted, the U.S. government continues to spend more on services to help the unemployed; but it is only transferring income, not creating job growth opportunities. The current administration’s attitude of taxing the rich to give to the poor does not promote tax base growth. We need to create more tax revenue; instead it appears the current strategy could create conditions for a stagnant economic situation for much longer than the bull is prepared. Bottom Line: The bear doesn’t disagree; we have the global population base for increased demand, that’s not the issue. His issue is who has the money to pay for it? The supply bear also takes direct offense to the bull’s argument about weather. The corn crop is off to one of its best starts in years and the wheat crop looks to be equally strong domestically and globally. As the market heats up in June and July with the good genetics, we have in place the potential to see 165 or better if the dry weather holds off to late August to early September. The bear will admit the soybeans have the greater risk since

> Once the crop is in the ground, the market does not care about what it costs producers to put it in the field, it’s only worried about what the market wants to pay for the product.

August is critical for pod filling. So the potential to exceed a 43 bushel per acre crop is most likely not going to be seen. The final big supply bearish argument for corn and wheat lies in what is on the farm. The wheat market is currently offering commercial interest in excess of $1.12 a bushel to store wheat from this July to next July. Many producers have elected to hold [unpriced] a big part of their 2009 corn crop. The reason cited is the high cost around $4.00 forced them to go for a higher price that was never seen. This supports my belief that, once the crop is in the ground, the market does not care about what it costs producers to put it in the field, it’s only worried about what the market wants to pay for the product. So which of these fundamental outlooks are correct? CORN- Since February the corn market has been stuck between $3.96 on the upside and $3.70 on the downside. Both arguments are powerful, which has not allowed either the bull or bear

to dominate. Seasonally, from Memorial Day to the 4th of July, you have to give the edge to the bull for a weather related bounce. However, if he cannot get something going, I believe the cash markets are going to crash under the weight of big corn supplies that must be dumped. What can be done? I have to suggest the clock is ticking. I believe December corn should be sold between $3.90 and $4. If it moves above $4.05, defend half of the positions; if it moves above $4.15, defend 100 percent of the positions. SOYBEANS- The horse is well out of the barn, in my opinion. We are nearing major support levels. If they don’t hold, I believe the downside risk is easily $8.25. Equally, a July to early August dry weather event would really hurt soybean yields. Therefore, I believe producers need to be more cautious in their selling. I like getting a floor below the market if it crashes, but no margin call exposure if it rallies. The strategy I’m recommending to my Summer 2010



MArket outlook

subscribers is selling one at-the-money put and buying four out-of the-money puts. If you want more details, call me at 800-832-1488. WHEAT- If you have storage, the market is desperately trying to urge you to store as long as you can. I suggest placing hedges in deferred positions. Remember, if you are planning to store, don’t put it in the bin unpriced! Bottom Line Unless we have a major weather event or a major demand event, I believe there is real downside price pressure ahead for us. The problem is, with last year’s high costs, selling corn and soybeans for remaining old crop corn and soybeans is a losing situation. In regard to new crop, the loss of profit incentive since early December has frozen producers into action. Our fear now is producers are not going

to do anything until the last moment. They will put it in the bin and hope for a white knight to save them. Unfortunately, many times this only happens in the movies; this is real life. Financial risk is now a fact we have to live with. Before trading, one should be aware that with potential profits there is also potential for losses, which may be very large. You should read the “risk disclosure statement” and “option disclosure statement” and should understand the risks before trading. Commodity trading may not be suitable for recipients of this publication. Those acting on this information are responsible for their own actions. Although every reasonable attempt has been made to ensure the accuracy of the information provided, Utterback Marketing Services Inc. assumes no responsibility for any errors or omissions. Any republication

or other use of this information and thoughts expressed herein without the written permission of Utterback Marketing Services Inc. is strictly prohibited. Price quotes obtained from DTN. Copyright Utterback Marketing Services Inc. 2010. ABOUT THE AUTHOR Bob Utterback is the Economist for Farm Journal magazine and President/CEO of Utterback Marketing Services, Inc., located in New Richmond, Indiana. He has over 27 years of experience analyzing ag commodity markets, with special emphasis on the corn and soybean markets. Contact him by phone 765-339-7704 or by email  he opinions stated herein are not necessarily T those of GreenStone FCS.

Where do you find  answers for your farm? Environmental regulation, farm policy, building consumer trust...Get answers on these and other topics vital to your operations success at Agricultures Conference on the Environment.

January 27, 2011


Partners Summer 2010

News update

GreenStone Customer Appreciation! Listed below are just a few upcoming GreenStone customer appreciation events. Invites will be arriving in customer mailboxes throughout the summer and easy online registration makes signing up a snap! Join your branch this season for a special celebration in your honor. Charlotte Friday, July 16 NE Wisconsin Friday, July 23 Allegan Thursday, August 5 Hastings Thursday, August 5 Mason Friday, August 6 St. Johns Friday, August 6 Howell Friday, August 6 Lakeview Friday, August 6 Schoolcraft Thursday, August 19 Corunna Friday, August 27

join us at our

er oiatm st cu apprec ion


Candid Comments... I purchased my first vacant parcel "up north" with GreenStone's help in 2005, and y'all came through for me again just yesterday, when I closed on the purchase of another vacant parcel...right next to my house! Most recently I worked primarily with the GreenStone office in Howell, Michigan; but I also spoke with helpful representatives from your Ann Arbor office. The property I was able to purchase with GreenStone's help has become an incredibly important part of my life. I have enjoyed countless trips to my wooded property up north and can now enjoy having a little more land right here

at home, too. I truly feel that I couldn't have done it without you. Thanks for being so easy to work with— everyone has been friendly, understanding and responsive - no unpleasant surprises. You make it easy! Dan Reynolds Howell Branch Customer Thank you for the scholarship this year to Farm Women’s Symposium at Bay City. FCS has been a supporter of our symposium for years and I know I really appreciate the scholarship I was given. Symposium is great fun, a chance to meet new friends and get

reacquainted with each other year after year. Thank you again for your part in doing this for so many of us farm women. Shirley Carson Hart Branch Customer Thank you for supporting the Farm Women’s Symposium with scholarships. I received a scholarship for which I am very thankful. It means a lot to get away for a few days. It was educational and I learned a lot. It is great to be able to get together with other farm women.

Thank you more than I can express for your support of the Farm Women’s Symposium. With your support we are able to reach out and be supportive of women in agriculture all over the state of Michigan. Your support has made a wonderful difference. Thank you. Debbie Rosmussen Farm Women’s Symposium Committee Member The Farm Women Symposium comments seen here represent a sampling of numerous notes received from participants.

Thank you again. Lillian Auttman Mother of Bay City Branch Customer

Summer 2010




Directors' Perspective:

Agriculture and the Economy We are all aware of the struggling economy those of us in Michigan continue to experience. What is much less known within the general public is that despite this downturn, agriculture has continued to be a shining light and one of the few growing sectors in our state. As our second-leading industry, agriculture contributes more than $71 billion annually in economic activity and employs more than one million residents, yet there are times when it seems there is more negative publicity for agriculture than positive. From your perspective, can agriculture actually be a catalyst for turning around our state’s economic troubles, and if so, who become the key players in making it happen?

Lyn Uphaus, Region III Director Yes, I believe that agriculture can be a major player in helping to turn the state's economic woes around. Agriculture has already created new jobs with five new ethanol plants up and running in the state. There were many construction jobs created during the development phase and now there are several new permanent jobs now that the plants are up and running. Besides the employees at the plant, there are several job opportunities in transporting the ethanol and feed by-products that the plants produce. These plants also use outside firms for maintenance and updating of the plant's equipment. Ethanol production in the state has encouraged corn growers to increase their acreage, which in turn has created more jobs with increased demand for inputs, transportation and storage. Other agricultural industries such as dairy, fruits and vegetables have


Partners Summer 2010

also added processing capacity which has created jobs. There is also demand for employees for machinery manufacturers and dealers, especially employees with technology skills due to the increase in high tech equipment being developed. One reason agriculture does not get a lot of credit for creating jobs is because most of these employers are small businesses who do not hire large numbers of employees. The press tends to overlook these smaller employers; therefore, the general public is not aware of the jobs being created by agriculture. Commodity groups, Michigan Farm Bureau, GreenStone, MABA, and others will have to come together to promote agriculture's importance to the Michigan economy. Our political influence is small compared to other industries. So, we will need to work together to create a much larger voice advocating agriculture.


Frank Engler, Region V Director The opportunity for agriculture to expand in the state is possible and most likely will occur. With the diversity of commodities produced in Michigan the need for processing to add value remains high. In order for these farms and agri-businesses to thrive, some fundamental changes need to happen. Some of the changes I would like to see would be streamlining the permit process. Not only are permits expensive, but the time required to process the permits is extremely burdensome to a new or expanding business or farm. Michigan needs to encourage entrepreneurs to start businesses in the state and not overwhelm them with regulation. The tax structure in the state also needs to be reformed. All taxes should be applied fairly and equitably. The property tax is a good example of an out-dated tax that unfairly affects farmers. As farmers are many of the largest property owners in the state, even small increases in property taxes will have an extremely negative effect on farmers, increasing their cost of doing business. Another problem with this tax is it does not take into consideration whether or not the farm makes a profit. If the farmer has a

down year, the property taxes still must be paid. P.A.116 helps alleviate some of the pain, but the act comes with strings attached and doesn't address the fairness issue. A better source of funding must be found. The Michigan Business Tax surcharge is another tax that is hurting the business climate in the state. The idea that placing a 22 percent surcharge on businesses would have anything but a negative effect on growth is absurd. One of the many problems with the MBT is that it has been administered on an extremely variable basis. While one business is taxed at one rate, another is taxed at a different rate. Again a more equitable tax is needed. GreenStone and other agricultural groups must continue to promote our issues, but the key players are the individual farmers getting involved in all segments of government. Many farmers serve on school, township and county boards, but we are often underrepresented on other boards. Local Chambers of Commerce and Economic Development Committees are a couple of examples where agriculture could greatly benefit if we all get more involved.

Dave McConnachie, Region II Director From my perspective, agriculture is already the catalyst turning our state economy around. Agriculture has been a steady economic contributor for decades, and is an economic force that creates and maintains economic activity and jobs. Farmers and agribusinesses are entrepreneurs and small businesses that have pride and passion for their livelihood, and everything that touches that livelihood including their families, communities and our state. There are so many various and diversified businesses that are created by the entrepreneurial farmer that a lot of other types of jobs and economic opportunity are created in the ripple effect all the way to the consumer. GreenStone and other organizations, by working together, have an opportunity to bring agriculture related businesses together so that all our individual voices can be heard as one. Farmers have been content to let others do the leading while living our own independent lives‌now it's time through one voice – to be the catalyst to help all of Michigan.

Summer 2010



Young, beginning and small farmer feature

Learning from the past to teach for the future By Laura Moser

Dissecting the way an 1800’s fodder cutter was designed and used, Howard Cain imagines how farmers in Africa or Haiti may use it to chop the native grasses in their area of the world. Matching equipment and farming practices from early American agriculture with developing nations around the world is the work of Tillers International, located in Scotts, Michigan. Tucked off a rural road 15 miles southeast of Kalamazoo, few passersby would realize the international reach of what to an American’s eyes looks like a small hobby or Amish farm. Yet, the work done at the 430-acre farm lays the foundation for new farming operations all over the world.

Young, beginning and small farmer feature

The idea for a place like Tillers International came from its director, Richard Roosenberg. After serving in the Peace Corps in Africa in the 1970s, Richard was motivated to help less developed countries find ways to be self-sustaining. After running the Tillers program at a historic farmstead at the Kalamazoo Nature Center for eight years, the Abbey family invited them to share their farm in 1989. In 2003 Tillers moved to its current site near Scotts. GreenStone Farm Credit Services provided financial assistance to obtain the current site. Since 2003, Tillers has built a learning environment building-by-building: a blacksmith shop, a wood shop, a museum, and four barns. Two barns were disassembled from the prior Abbey farm and reassembled. One barn, the 1870 Springhill Barn, was given by the Edison,Tatroe, Mawby family from Walker. When re-built at Tillers by Rob Burdick, Steve Stier, and volunteers, it received a Barn of the Year award from the Michigan Barn Preservation Network. The buildings are an old style that complements the draft animal farming that occurs around them. All the while, Tillers has been pursuing its mission to preserve, study and exchange low-capital technologies that

“What looks like an archaic piece of farm equipment or practice is a dream come true to a farmer holding the handle of a hoe in another part of the world.” increase sustainability and productivity of people in rural communities. “What is hard for Americans to understand is that what looks like an archaic piece of farm equipment or practice is a dream come true to a farmer holding the handle of a hoe in another part of the world,” Richard says. Roosenberg and the others at Tillers International take a multi-directional approach in their educational efforts. Workers at Tillers dissect the process of low-capital, sustainable farming practices in order to teach others. Students can come to the farm for internships where they

Tillers board member and draft horse instructor Duane Westrate guides a historic grain reaper binder behind Tillers' Belgians.

Summer 2010



Young, beginning and small farmer feature

Tillers International Director Richard Roosenberg (right) was motivated to help less developed countries find ways to be self-sustaining. Tillers’ Ugandan trainees learn to plow with two ox teams hitched two-up, using a dynamometer to measure the force of draft on the plow.

learn farm practices that can be adopted to their areas of the world. Other times, Tillers sends people to the regions to evaluate the resources and skills available and then takes that knowledge back to the Michigan farm to begin re-inventing equipment that could be used in that particular area. “We don’t come into an area and tell people how they should do things, or bring our tools or practices in,” Richard says. “Rather, we help them come up with solutions using local natural resources and local people. We have backed away from delivering a ‘recipe for success’ and have evolved to a point where we are helping people become more experimental in their own farming systems.” In 2009, Tillers opened a learning center in Mozambique led by Brian Webb of West Branch, giving them a permanent presence in that area of the world.

Oxen Power One of the cornerstone practices at Tillers is the use of oxen in farming practices. Historically, Oxen and draft horses were essential to farmers to work the land and provide power to a variety of practices. The use of animals in farming has essentially died off in this country, but in other parts of the world, they are just now being introduced to the advantages of oxen and draft horses in farming. “At Tillers we work to keep alive the spirit and modern efficiencies of farming with horses,” Richard says. “ We also work to preserve and advance the skills of working cattle.” Because oxen are more economical and readily available in other parts of the world than horses, Tillers focuses on training the cattle and the farmers to properly use oxen 13

Partners Summer 2010

in agriculture production. Roosenberg and Dulcy Perkins, Tillers’ farm manager, have developed positive, calming, training techniques for the oxen that produce more calm and relaxed cattle. “We use animal training behaviors that are heavy on positive reinforcement,” Richard says. “The animals are quick to respond and we find that animals will work longer and have better control when they are not nervous or scared.” When international visitors come to the Tillers farm, they are taught Tillers’ training skills and how to use the implements powered by oxen. Once the students complete their training, they return to their home and train others. Along with the international scope of the oxen, Tillers also works with those in this country to keep alive the spirits and efficiencies of farming with horses and cattle. “We are seeing a rise in the interest of draft animal smallscale farming in this country,” Richard says. “This type of

Young, beginning and small farmer feature

“People in other parts of the world stand in admiration of American agriculture today... Historians say that American agriculture made the most progress when farmers asked, ‘what can we do that is new’ rather than doing what their parents did. That is what we are attempting to do with our rural development program, helping people look at old problems with new solutions.” farming promotes a more closed energy and input cycle than do modern industrial agricultural techniques.”

Farm Tool Museum Tillers International houses a collection of farm machinery artifacts, gathered by a local farmer, Carroll Abbey. When Abbey passed away in 1998, Tillers took possession of the extensive collection of farm implements in a partnership with the Kalamazoo Community Foundation. Using the historic farm tools as a template, Tillers staff and volunteers “re-invent” them to fit needs of farmers in other parts of the world. Howard Cain, a retired accountant, and others have volunteered hundreds of hours to catalog and record the 4,000 pieces in the museum. “The museum collections are instrumental to our international rural development mission,” Richard says. “They serve as models of innovations for our international projects.” Tillers, which is a working farm, attempts to use the same practices as those they work with. At a recent barn raising, workers used hand-made tools, hand-planed beams and several workers to erect a new granary. By using the same practices as those they help, the volunteers are better able to find applicable solutions to local challenges. The barn raising was the final class project for a timber framing and raising class offered in the spring.

American Farming Heritage “People in other parts of the world stand in admiration of American agriculture today,” Richard says. “Historians say that American agriculture made the most progress when farmers asked, ‘what can we do that is new’ rather than doing what their parents did. That is what we are attempting to do with our rural development program, helping people look at old problems with new solutions.”

In addition to helping those in other countries, Tillers also offers a range of classes for local people looking to learn how to incorporate low-input sustainable farming practices into today’s modern world. Keeping alive traditional farming skills like blacksmithing, stone masonry, woodworking, cheese making and other practices is important to the folks at Tillers.

Financial and Administrative Support While not everyone can travel to Africa or Central America to help foster the work of Tillers International, several people donate time and resources. The list of names on the board of directors reflects the far-reaching appeal of the work done at Tillers. Board members represent two universities and several organizations in the state. “We are proud to be associated with the work of Tillers International,” says Bert Sheridan, GreenStone Farm Credit Services West Regional Vice President. “We see the good things they are doing here and around the world and are glad we have been able to help in their endeavors.” Tillers operates as a 501(c) non-profit organization. Income through classes, books and tours along with the help of generous sponsors, is used to further its mission and keep alive the rural heritage of this country. Both active and retired farmers, in particular, appreciate Tillers’ mission and have become an increasingly important part of its financial and volunteer support base. To learn more about Tillers International visit its web page at Or call 800-498-2700 to arrange a visit, schedule a tour group, take a class, volunteer to help, or contribute. A visit to Tillers takes you both back in time and mentally out into the world beyond America’s borders.

Summer 2010



Crop Insurance

GRIP and GRP policies will continue to be available with no major changes.

Crop Insurance Changes for 2011 Look Positive As producers finish up 2010 crop planting and get their acreage reports in for the spring crops, the crop insurance companies are busy preparing for 2011 policy changes. The Risk Management Agency (RMA) has released many details for the new Common Crop Insurance Policy for the 2011 crop year. This new policy will be referenced by many as the “Combo Policy”. Agents will be trained on the new policy changes in July and August.

The Common Crop Insurance Policy will replace Crop Revenue Coverage (CRC) and Revenue Assurance (RA) policies and will be combined with Actual Production History (APH) for corn, soybeans, wheat, barley, grain sorghum, rice, and cotton. You will have a choice of Revenue Protection or Yield Protection. Revenue Protection protects against loss of revenue due to production loss, price decline or increase, or a combination of both. You will also have the choice to exclude the Harvest Price option which protects for price increases. Projected prices and harvest prices 15

Partners Summer 2010

will continue to be established using the Chicago Board of Trade prices. Yield Protection protects against yield loss at the projected price. For crops under the Common Crop Insurance Policy, the prices used for yield protection will be the same as the projected price for revenue protection. Other common crops insured in the GreenStone market area such as sugar beets, dry beans, forage, oats, onions, potatoes, tomatoes, etc., will still use an established price and use a yield protection policy.

There will be some minor changes in the fruit and specialty crop policies. Agents will have the details for these changes as we get closer to the fruit sales closing date of November 20. How do these changes benefit you, the producer? They simplify the CRC, RA, and APH policies and the choices available. In the past, Michigan growers have chosen between CRC and RA (RA was not available in Wisconsin). In one year, CRC could be less expensive than RA in some counties, and the next year it might be more expensive. CRC and RA used a different price risk factor in the premium calculation. For some crops, there was a different time for when the harvest price was determined. In the past, the established price for APH was almost always different than the CRC or RA prices. Going forward the same price will be used; it will simply be Revenue Protection or Yield Protection. You may be asking “Will I have to re-sign a new application?” RMA is making this as easy as possible for you. Your crop insurance policy is a continuous policy and it will convert to the new policy as either a revenue or yield policy based on what you had in 2010. You will not have to sign a new application, but it is recommended that you visit with your agent to get a clear understanding of what policy type you have and its features and benefits. You will be receiving some mailings and new Common Crop Insurance Policy provisions from your crop insurance company either by regular mail or electronic copy. These changes are good for you. You should find them beneficial as they simplify your crop insurance decision process. We hope you have a great 2010 crop.

oUr money


For the country. When it comes to rural financing, no lender can match GreenStone in experience or service. Call your local GreenStone branch and learn more about our “countryfied” line-up of products and services. Financing for: • Personalized Construction • Distinctive Home Sites • Rural Home Mortgages • Scenic Recreational Land

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Summer 2010



Guest column

“Listening” to Your Budget?

John Williams, MBA, Business Consultant, Lookout Ridge Consulting


Partners Summer 2010

Recently I heard a speaker discuss listening to people in 3-D. He said 3-D listening starts with the words a person says, but also includes the context around the words and what is missing from the words as you observe the speaker’s body language. There are a bunch of 3-D movies out this summer—they promise a more vibrant, lively experience than regular, flat movie-going. Applying the 3-D concepts of great listening can similarly transform your simple, “flat” actual-to-budget review into much deeper understanding of your business. How can you begin “listening” to your budget?

Try to remain open minded and objective during an initial pass through an actual-to-budget review. Emotional responses affect interpretation of the messages heard and raise barriers to problem solving.

guest column





Share your findings with those that can help solve the problems you have uncovered. Set timelines to accomplish what needs to be done.

Focus on content in the production, financial and marketing dimensions In listening lingo, the words are the financial information and the variance from budget, the context is the production and marketing environment, and what may be missing is how the three did not respond as you thought they would when you first drafted your budget. Spending time on this third dimension of why your budget was off is the most overlooked and most valuable part of the actual-to-budget review process. Keep emotions in check When you don’t like what you see during the review, it is easy to become emotionally involved. An emotional listener often hears what they want to hear; NOT what is being said. Try to remain open minded and objective during an initial pass through the actual-to-budget review. Emotional responses affect interpretation of the messages heard and raise barriers to problem solving.

Avoid distracted listening Give the review the timely attention it deserves. Find some quiet space (it might not be in your office or at your kitchen table) to perform the review. Try not to let your mind turn to the work you are delaying. Catching and correcting issues as a result of your review is probably some of the most valuable work you can do. Treat what you “heard” as a challenge The data is there. Find the issues and identify if they're ones you can manage. Communicate what you have learned One fundamental skill of great listening is to “mirror back” what you have heard to the speaker. Share your findings with those that can help solve the problems you have uncovered. Set timelines to accomplish what needs to be done. Follow up to make sure people understood what needed to be done.

Great listening ability may be one of the most important skills a strong manager possesses. How well you listen can have a major impact on your effectiveness and on the quality of your relationships with others. By tuning in to the context and to what’s missing, you can take the routine process of actual-to-budget review to a dynamic new place. ABOUT THE AUTHOR John Williams provides financial consulting, business valuation and mergers and acquisition expertise to family-owned agricultural businesses. Prior to his work at Lookout Ridge Consulting, John was the CFO at Country Fresh, a Grand Rapids dairy processor. John can be reached at, or at 269-382-0539. The opinions stated herein are not necessarily those of GreenStone FCS.


Summer 2010



1760 Abbey Road East Lansing, MI 48823

Prosperous Future. GreenStone’s array of products and services are designed to meet the agricultural needs of you and your business. • Equipment Loans • Real Estate Loans • Operating Loans

• Leasing Services • Crop Insurance • Life Insurance

• Tax Preparation • Accounting Services • Appraisal Services

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Supporting your

Partners - Summer 2010  

GreenStone's quarterly agricultural member publication providing association news, guest columns on timely topics, and feature stories on va...

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