Posts

By Craig Rogan, Investors Community Bank

Craig Rogan, Investors Community BankAs the 2021 harvest season comes to an end, a new beginning is in the horizon. As we reflect on the second year of increased feed inventory throughout most of the state for dairy farmers, our producers may be facing a decision on how to best capitalize on excess feed inventory. The farmer, with the help of his team of advisors (nutritionist, agronomist, vet, consultant, banker), may consider the following options:

Should excess feed be sold as another revenue stream?

Does the farmer consider alternative crops such as oats to sell and harvest the straw to sell or keep for their own use?

Can the herd be expanded in existing facilities to increase milk production with more animals on feed?

If an expansion is looked at, be sure to consider whether it will affect a quota with the milk plant or if the milk plant will even take the additional milk.

Does the increase in feed inventory provide an opportunity to reduce cropping costs in 2022?

Feed and cropping expenses increased throughout 2021 and appear to be on an upward trend into 2022. Does the excess feed inventory provide opportunity to save on fertilizer cost, for example, knowing they can reduce spread on the field despite a potential negative effect on 2022 yield?

The importance of making a robust plan with the help of advisors will be a key to success for our farms in 2022. 

As bankers, we can help our customers navigate through making these decisions by providing financial analysis help in working through various scenarios and the impact each has on the client’s cost of production.

As feed and fertilizer cost increase heading into 2022, maximizing this excess feed inventory will be the key to 2022 cash profitability. One notable aspect that can be completed now to assist in mitigating continued rising costs is fall tillage. Future fuel costs are expected to be higher than today and it could be prudent to do tillage along with manure application in the fall. Optimum 2021 fall weather conditions are ideal for completing tillage. By completing fall tillage this will allow for less work, stress and timely planting in 2022. Not completing fall tillage will be a missed opportunity. Communication is the key in any relationship. Continue to work with your customers to be proactive in their planning for the upcoming year.

Craig Rogan is vice president, ag banking officer with Investors Community Bank in Stevens Point and serves on the WBA Agricultural Bankers Section Board of Directors.

The excitement of a new year and COVID-19, which affected the global supply chain during this pandemic, have awakened consumers to the importance of agriculture. We, as ag bankers, realize how important farmers are to this economy. We will start seeing more growers digitize their farms at a faster rate and use electronic platforms with their partners to conduct routine business. We also will see agricultural professionals increase their personal protective equipment for their staff and establish better social distancing to mitigate the risk of spreading the virus.

If the virus doesn’t get under control and the infection rate keeps increasing, we could see supply chain shortages and slowdowns from farm product deliveries as workers stay home due to illness or caring for a family member. These same concerns would affect processors. Slowdowns could also impact fertilizer, fuel, and other farm inputs.

Everyone has experienced a lot of stress this year dealing with the COVID-19 pandemic, which has caused turmoil in markets and loss of work and family illness. I hope that we all stand together to get through these hard times and put our people and country first.

Let’s all remember to thank all the farmers who work so hard to supply for the needs of this country.

Paul Curran is VP, commercial/ag lending with Ergo Bank in Fox Lake and serves on the WBA Agricultural Bankers Section Board of Directors.

25 bankers attended and completed the WBA Agricultural Lending School, held August 4-6 at the WBA office in Madison. In addition to the classroom instruction, case study work, and many discussions, the group also went on a farm tour of Sassy Cow Creamery in Columbus. The group met with third generation co-owner and operator James Baerwolf to discuss their farm operation, then enjoyed dinner and ice cream back at the creamery. A special thank you goes to Sassy Cow Creamery for hosting our bankers!
 
The school is instructed by BMO Harris Bank's Bradley Guse and UW-Platteville Professor Kevin Bernhardt.
 
Congratulations to these bankers for their successful completion of the 2021 school!
  • Allison Batton, Royal Bank, Cobb
  • Amber Bellows, Investors Community Bank, Oneida
  • Becky Bisek, Waumandee State Bank
  • Derek Blanchard, Investors Community Bank, Marshfield
  • Joseph Boilini, Town Bank, Burlington
  • Kari Bosse, Bank First, Watertown
  • Aaron Breuer, Peoples State Bank, Mount Hope
  • Ashley Connors, Royal Bank, Cazenovia
  • Hannah Delwiche, USDA – Farm Service Agency, Sturgeon Bay
  • Jacob Flannery, Wisconsin Bank and Trust, Monroe
  • Daniel Glass, Peoples State Bank, Lancaster
  • Tracy Gomoluch, Investors Community Bank, Green Bay
  • Tony Hein, Citizens State Bank of Loyal, Neillsville
  • Cody Kirschbaum, Peoples State Bank, Prairie du Chien
  • Josh Murray, Farmers & Merchants Bank of Kendall
  • Brooklynn Nagel, Royal Bank, Prairie du Chien
  • Kasie Nellis, Bank First, Waupaca
  • Aubrey Netzel, Investors Community Bank, New London
  • Nick Neubauer, River Bank, Holmen
  • Cole Paulson, CCFBank, Barron
  • Alison Prey, Investors Community Bank, Green Bay
  • Derek Sedlacek, Bank of Luxemburg
  • Joel Steber, Peshtigo National Bank, Green Bay
  • Amanda Suchla, Bank of Prairie du Sac
  • Julie Vomastic, Investors Community Bank, Cecil

By, Lori Kalscheuer

For decades now, one of the symbols of the American farmer is his/her iconic baseball cap, sometimes known as a seed corn cap. Caps not only have the physical functions of hair keeper, sun visor, and dust shield, but they also serve as an advertiser of the products and services used by a farmer or even sentiments held by the wearer. Beliefs and virtues such as hard work, persistence, and family traditions creep into the advertising slogans sported on farm caps offered by equipment dealers, seed corn companies, feed suppliers, and yes, even banks. Though they can only wear one cap at a time, farmers may own dozens of caps; some well-worn and sun-faded and others still collecting dust in a closet.

Like the variety held in their farm cap collections, farmers wear many ‘hats’ or caps in their daily roles on the farm. There are numerous skills and competencies in which a farmer must manage and master in order to be successful. As the saying goes, “Do more of what you do well and delegate or hire out the rest.”  Understandably, the scope and scale of a farm may drive which competencies or tasks can be affordably delegated or hired. Here are some of the caps in which a farmer must wear to help ensure best success:  

  • Business Strategy – forecast and assess business model performance, enterprise mix, expansion and diversification opportunities, and resource management (time, talent, capital).
  • Livestock & Milk Production – deliver nutrition, healthcare, sanitation, breeding, growth and development programs for animals in all life and production phases.
  • Crops & Land Production – implement agronomic best practices for growing quantity and quality crops and feed, averting diseases and pests, improving soil health, and evolving conservation practices.
  • Equipment & Facilities – selection, maintenance, and repair of large equipment, vehicles, structures, and systems needed for the production, handling, and distribution of crops, manure, feed, and milk and meat products.
  • Financial & Marketing – manage budgets for the purchase of inputs and capital expenditures, delegation of labor, human resource relations, operating cost containment, and price discovery for the sale of outputs.
  • Risk Mitigation – negotiate legal contracts, insurance coverages, human and animal health and safety practices, government programs related to production, pricing and land management, environmental standards, market trends, and weather.
  • Public Relations & Communications – interact with the general public (99% are not familiar with modern farming practices), municipalities, neighbors, politicians, producer groups, consumer groups, and others who want to better understand how food, fuel, and fiber is produced and distributed locally and globally.   

In some farm businesses, one or two people wear most or all of these caps. Yet in others, these caps are worn by fellow family members, neighbors, employees, or outside experts to deploy specialized functions and best practices. As agricultural lenders, it is our job to understand our clients’ favorite caps- the ones in which they are the most skilled and to recognize which caps are being worn by chosen delegates in order to accomplish the farm’s operational and financial goals. Thus, lenders have a few hats of our own to wear each day too, and it’s perhaps one of the most enjoyable components of our role. It’s a great day to be an Ag Lender!  

Amber Keller is the current vice chair of the WBA Agricultural Bankers Section Board of Directors and is the senior vice president, director of ag banking with Town Bank in Clinton.

By, Lori Kalscheuer

June 1 marked the start of a new fiscal year at WBA, meaning the start of a new membership year as well for the WBA Agricultural Banker Section, which also means some changes for our WBA Agricultural Bankers Section Board.

Our new Section Board Chair is Chris Schneider, vice president of agricultural banking with Investors Community Bank in Manitowoc. Let's meet Chris! 

Chris grew up on larger dairy in Hilbert, Wisconsin where his grandfather started in late 1940’s. The farm grew to 700-800 cows by 1995, where his father and 4 uncles farmed together. Chris grew up on the farm, so as he shared, "it was the center of my life." After coming back from school at UW-River Falls in 1988, Chris was the assistant herdsperson until 1997. He then left the farm and worked for a local John Deere dealer as sales rep and service manager.

In 2005, Chris was asked to join Investors Community Bank as a loan officer, and he has been at the bank ever since. In his position, he works mostly with dairy farms and some cash grain farms. "The most enjoyable part is working with farm families and watching them succeed" shared Schneider.

Chris currently resides in Kaukauna with his wife and 4 boys ranging from 11 to 25 years old. He enjoy spending much of his time with family and attending the boys' sporting events. 

Chris is "honored to be part of WBA Ag section and work with the dedicated people who serve the Ag community."

Learn more about the WBA Agricultural Bankers Section Board and our 2021-21 board members by clicking here.

 

 

By, Lori Kalscheuer

If there is any lesson I’ve learned coming out of 2020, it is that we shouldn’t be surprised anymore, really, by anything.

In the agricultural world, we’ve witnessed milk being dumped because schools closed down. Would you have ever imagined that? We saw packing plants send employees home and turn cattle away because people got sick. We saw fuel prices go negative for the first time in history because no one was driving. We saw whipsawing commodity prices going from a period of 5-7 years of doldrums to some of the best prices in a decade. Lines and shortages in stores of literally everything.  Forgivable government loans. High unemployment yet job shortages. Just-in-time supply chains that are never on time anymore.  

All the while watching our own government printing money at a pace that would have shocked anyone from any political persuasion just years before. It’s as if public debt no longer matters.  

Was it weather that caused all of this? Was it population growth? A natural disaster.

No, not this time. 

All of the economists' models that predict trends broke this time. This time, it was unforeseeable events – and more importantly, human behavior that caused much of this.  

The proverbial “black swan” and then the feedback loop of human behavior reacting and re-reacting to it.

We’ve seen how human behavior and emotion can really change almost everything when something unpredictable happens.

Even in the workplace, the events of the past year really drove behaviors in people that were not predictable, and in some cases, truly surprising. You know what I’m talking about. There are many people who have risen through the ashes and have shined. And then there were those who really surprised us.

Of all the lessons we should learn, is that we really shouldn’t be surprised anymore.  

And agriculture is one of those industries that can shine through just about any adversity thrown its way.

 

Jeff is senior vice president with Royal Bank in Lancaster and has just completed six years of service on the WBA Agricultural Bankers Section Board.

By, Lori Kalscheuer

Greetings fellow Ag Bankers! I am certain this “From the Fields” newsletter finds you knee-deep (or perhaps neck-deep) in spring loan renewal season! The hope is, you found plenty of useful information you can share with your customers as a result of our recent WBA Agricultural Bankers Conference that took place April 7-8. 

The conference this year started with the always educational and exceedingly entertaining Dr. David Kohl. Among other things, Dr. Kohl reminded us that the number of zeros and commas in our loans these days makes it important to monitor ratios and all things financial with our customers on a regular (perhaps more than once a year) basis. Listening to Dr. Kohl reveals that the more things change, the more they stay the same. Key ratios that were the focus in ag lending years ago remain key ratios today. Equally as important are the credit issues that can surface “outside the numbers,” once again reminding us of the importance of being cognizant of all the many factors that impact our customers’ businesses and the potential effect on success or failure.

Dennis Frame, Co-Founder of Discovery Farms Wisconsin, shared ideas and examples of how we can empower our customers to lead in protecting and improving water quality in Wisconsin. With the high demands and expectations that the public puts on agriculture, this session offered ideas relating to new conservation practices with the end goal of protecting natural resources; a win for our customers, the consumer, and the environment. Dennis provided materials we can share with customers who may be interested in Producer-Led Watershed Protection Grants. 

Hailing from the state of Minnesota, now living in Illinois, and speaking to Wisconsin ag bankers, the key question asked of Ed Elfmann was what he thought of Aaron Rodgers hosting Jeopardy! All kidding aside, Ed, Senior Vice President of Agricultural and Rural Banking Policy with the American Bankers Association, presented a wealth of information regarding politics and its potential effect on agriculture. Ed discussed everything from new committee appointees, USDA, PPP, CFAP, American Rescue Plan Act of 2021, farm debt, farm consolidation, bank consolidation, ECORA, rural development, and everything in-between. Ed also added that the National ABA Agricultural Bankers Conference is planned as an in-person event later this year in Cincinnati, Ohio.

After the enjoyable morning networking session, which was as close as we could get to the longed-for face-to-face conferences of bygone days, Thursday morning took off with Dr. Mark Stephenson both looking in the rearview mirror, and keeping an eye on the windshield. Through slides and commentary, Mark shared graphs and statistics that explained what occurred in the dairy industry during 2020, on the local, national, and worldwide level, as a result of Covid. From disruptions in supply chains, to unemployment, from cheese consumption, to Farm-to-Family Food Boxes, from the DMC to CFAP, to DRP, LGM, and PPD’s, Mark provided an abundance of knowledge and understanding as to how we got where we are and where we may be poised to go from here.

Live from his basement office in Champagne, Illinois, Eric Snodgrass, Principal Atmospheric Scientist for Nutrien Ag Solutions offered an extremely interesting presentation about the weather. This was another session wrought with excellent weather maps, videos, and pictures of what makes the weather happen and how that affects agriculture. Eric fine-tuned his talk to Wisconsin and gave us a better understanding of weather and weather systems, its impact on crops and ultimately, farm profitability. Incidentally, I must report that Eric’s meteorological prediction was 100% correct… in spite of the balmy temperatures at the time of the conference, here in northern Wisconsin, sure enough, we received the snow he forecasted for the Tuesday after the conference!

Our wrap-up session included over a “century worth of knowledge” as Dr. Kohl (Virginia Tech), Sam Miller (BMO Harris Bank), and Lynn Paulson (Bell Bank) fielded top-of-mind questions from conference attendees. Commonly referred to as the “ESPN hot seat,” this session allowed audience members to direct questions to our three seasoned ag banking professionals. Some great take-homes from this closing session were the advice to not over-complicate things, a reminder that life is too short to work with “TeflonTM” people, to be comfortable in our own skin, to control what can be controlled, and to manage through the rest.

Wow! What a conference! Hopefully you were able to join this event and found it as beneficial as I did! 

The WBA Ag Section Board sends a big shout-out to this year’s conference sponsors: Bankers’ Bank, Farmer Mac, Federal Home Loan Bank of Chicago, Michael Best & Friedrich, and von Briesen & Roper. Also, please know that we have every intent to offer the Ag Bankers Conference, complete with sponsors and exhibitors, live and in-person in April of 2022! Watch for final dates to be shared soon!

As hard as we strive to put together meaningful virtual events, we know nothing really takes the place of that in-person sharing and networking. Therefore, your Ag Section Board is discussing and planning for potential in-person get-togethers this summer. Details will be forthcoming, but the thinking right now is to possibly hold a handful of informal, networking events throughout the state with the invitation to all Ag Section members to attend whichever ones might work for you. Keep watching your “From the Fields” newsletters and other communication from WBA’s Lori Kalscheuer who will be keeping all of us informed as the plans fall into place!

Until then, I will close my “From the Fields” write-up the same way I closed the conference: It has been my pleasure to serve as your Chair this past year. I wish you all good health, much success, and more good days than bad – until we meet again! Take care; stay safe; and thank you for attending the 2021 WBA Agricultural Bankers Conference! 

Darla Sikora is senior vice president of agricultural banking with Citizens State Bank of Loyal. She also serves as the current Chair of the WBA Agricultural Bankers Section Board.

By, Lori Kalscheuer

While we will be meeting virtually, we are all likely used to this now that over a year has passed. The outlook for the 2021 WBA Agricultural Bankers Conference once again has a great line up of presenters. You can find the full agenda online.

Dr. David Kohl will kick things off with topics of Covid-19 impact, global trends, supply-demand, consumer behavior, and challenges of ag stimulus packages. Dr Kohl always has a heartbeat of what is going on in the United States and with worldwide trends.

Dennis Frame will discuss Wisconsin water quality and what local farmers are doing to improve the water quality, sediment loss and nutrient loss. I have worked closely with Dennis and he has a real passion of the environmental impact of farmers' practices. He has helped some of the farmer-led groups to find ideas to help themselves with better farming practices.

ABA's Ed Elfmann will give us updates from Washington on upcoming changes and challenges when it comes to Agricultural adjustments to policy and trade.

Dr. Mark Stephenson will discuss where they Ag economy is heading and where it has been, including analysis of the last few years and comparing to where we are headed.

Eric Snodgrass will share how weather technology can help predict the growing season and weather factors from drought to flood. The growing season is becoming longer in most cases, and of course there's impacts on trade from other countries potential growing seasons.

To wrap up the virtual conference, Dr. Kohl, Sam Miller, and Lynn Paulson will host an open “question and answer” session where attendees can turn on their web cameras and unmute to join the conversation! They all have many years of experience and will share their thoughts and assist with your concerns.

In addition to the sessions that will be presented live, and also recorded for later access, conference exhibitors and sponsors are providing additional on-demand sessions that can be viewed at any time between the start of the conference and April 30. 

We all hope for good things to happen in the Ag sector, including weather, health, commodity prices, and fair trade. Your Ag Section Membership and support is as important as ever during these times. When we start a few membership year on June 1, 2021, please remember to renew your membership for June 1, 2021 – May 31, 2022 and keep our Ag Bankers Section strong.

I wish you all well, and I'll look forward to "seeing you" on April 7.

Chris Schneider is vice president, senior agricultural banking officer with Investors Community Bank in Manitowoc. He also serves as the current Vice Chair of the WBA Agricultural Bankers Section and will become our next Chair on June 1, 2021.

 

By, Lori Kalscheuer

The excitement of a new year and a presidential election has brought the markets up and down, so it's sensible to wonder what this year will bring to our farmers. I hope with changing technology, farmers can achieve better yields and prices. Agricultural technologies have advanced rapidly in the second half of the 20th century and at the beginning of the 21st century, changing the way farmers work indefinitely. 

  • Livestock genetics & breeding
  • Crop genetics & pest management
  • Labor and mechanization

Changing farming practices can have both positive and negative effects. For example, the introduction of genetically engineered (GE) seeds, wider adoption of irrigation, and growth in contract sales have allowed farm operators to diminish the intensity of soil tillage, reduce weather-related risks, lower production costs through increased specialization, and mitigate price risk. However, widespread adoption of GE plants is viewed with concern by some consumers, by farmers experiencing weed resistance to herbicides, and by nearby farmers specializing in organic crop production. Wider adoption of irrigation can reduce the availability of water for other uses and has implications for pesticide and fertilizer runoff. Increased contracting can leave some farmers worried about price-fixing and can increase their risk if the contractor defaults. Moreover, the geographic consolidation of larger livestock operations has heightened localized concerns about the handling of manure and its environmental consequences.

Just like farming technology changing for the better, Ergo Bank is not only keeping up with technology but is dedicated to being a leader in technology to better serve our existing and new customers.

I look forward to "seeing you" at the virtual WBA Agricultural Bankers Conference on April 7-8 where we can join together to connect and keep ourselves updated and serve as a resource for our farmers.

Paul Curran is vice president of commercial and ag lending with Ergo Bank in Fox Lake and serves on the WBA Agricultural Bankers Section board.
 

By, Lori Kalscheuer

If you have read through the “From the Fields” articles over the last year, you will find a common theme: Ag Lenders are more than bankers. Ask an Ag Lender what they do daily, and the response will be across the board from risk manager, counselor, friend, coach… the list goes on. Ultimately, what we do should add value to our customers. We can do that in several ways: 

  1. Be a resource. Whether it is having answers or knowing where to point your customers when they ask about programs like PPP, DRP, MPP, and CFAP, have those resources and links available so that you can email or text the updates to your customers. Be proactive and send out updates before you are asked.
  2. Have a list ready of core trusted advisors – CPAs, Attorneys, Estate Planners, and Crop Insurance Agents. Listen for key words in your conversations and suggest a name and number for them to contact. Send a follow-up message to see if they were able to connect.
  3. Be a good listener. Sometimes, our customers just need a sounding board. Listen effectively by asking questions and understanding what their responses are.
  4. Be aware of what is happening in the industry. Take a few minutes every day to review headlines and articles. Get on mailing lists and read up on the things important to your customers.
  5. Assist with planning and goal setting. Jeff Wilke of Denmark State Bank has his customers focus on what they can control (see Jan. 8 From the Fields article). This is great advice for all of us. Use tools from spreading software programs to help with peer trends and financial scorecards. Share this information at your annual meetings. Let them know what your expectations are so they can plan and avoid any surprises.

You are worth a lot when you have your customer’s best interests at heart. It will show by your actions and you will build trust. Do not forget the influence you have in your relationships with your customers. They value your opinion and appreciate the efforts to understand their operations. Keep finding ways to add value and be impactful in your connections. The relationships with your customers, and your worth, will grow with the effort you put in. 

Lisa Higgins is VP, ag/commercial banker, ag team lead with State Bank of Cross Plains and currently serves on the WBA Agricultural Bankers Section Board.

By, Lori Kalscheuer