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S O U T H D A K O T A

CORN TALKCORN TALKVolume 21 • Number 1 March 2005South Dakota Corn Growers Association

South Dakota Corn GrowersAnnual Meeting

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PRESIDENT’S REPORT

I recently had the opportunity to spend 13days touring Brazil along with my wife,

Carol, and SDCGA board members ReidJensen, Bill Chase and Paul Schubeck, on theCorn and Soybean Digest Tour. We learneda great deal and I am not nearly as afraid ofthis huge untapped land mass as I used to be.

Brazilians have the potential of adding 115million hectors of soybeans, but only if theprice at the Chicago Board of Trade is highenough. Last year it was, so this year theywill go from 49 million metric tons to 62million metric tons. But with a 25 percentcurrency f luctuation, $5.25 March CBOTprice and $25 extra cost to spray every acretwice for rust, they will lose money onevery acre of soybeans they harvest. If thesituation is the same at planting time, Ibelieve they will plant fewer acres nextyear.

Their transportation system is very limitedand no solution is on the horizon. The lackof public funds to build roads and rail isbecause of corruption and other demandson their federal budget that gets more atten-tion than transportation.

The real threat I see is in confined pork andpoultry production. They cannot grow cornto export and be competitive. They cangrow corn, feed it to livestock, export themeat and be very competitive. If we are notwilling to permit confined livestock opera-tions in South Dakota, Brazil will. A fewdays a year of unpleasant odor will not hin-der them. (For highligyhts of the Brazil tripsee page 7.)

There has been some discussion aboutWTO and the U.S. Farm Bill, particularlydirect payments versus the marketing loan.In the 2007 Farm Bill, there may not beroom for both. Let’s look at which benefitsBrazilian farmers and which benefits U.S.producers.

The direct payment rewards the land ownerfor the bushels that were grown on thatfarm 20-plus years ago. It is a gift from thegovernment for zero effort. It is socialism inits purist form. The payment f lows throughthe operator to the landlord to pay for high-

er rents which makes us less competitivecompared to our southern neighbors. It willnot reward or encourage current produc-tion. When a low market price says there isgreat financial risk to plant normal acres,producers will probably plant less andfewer bushels will be raised. The landownerdoesn’t care, the ethanol plant and the live-stock guy have higher production costs andChina and Japan will see us as an unreliablesource of grain. The biotech industry willhave less incentive to find new uses for ourgrain. The Brazilian farmer laughs all theway to the bank because he supplies themarket we left on the table.

The market loan puts stability in the market.It gives the operator assurance that if themarket heads south he will lose money, buthe will survive to fight another day. Itrewards the guy that creates the bushels.The market loan tells our end users and ourforeign market that we are a reliable sourceof grain.

The argument that you cannot LDP grainthat you do not produce because of cropfailure just doesn’t hold up. Crop insurancepays more per bushel for unharvestedbushels than the loan pays for harvestedbushels.

What about this big Amber Box that thepro-direct payment people keep warning usabout? Let’s keep the box full and supply acompetitively priced product. Maybe weshould show the Europeans our tail lightswith increased production.

No matter what program you choose, landcosts will be determined by the amount ofrisk and profit potential. The biggest ques-tion I have is, do you want to fuel Brazil’seconomy with U.S. direct payments or fuelours with a marketing loan?

David GillenPresidentSouth Dakota Corn Growers Association

David Gillen, SDCGA President

BOARD OF DIRECTORS

PRESIDENTDavid Gillen

White Lake-District 11

VICE PRESIDENTReid Jensen

Burbank-District 1

SECRETARYChad Johnson

Platte-District 10

TREASURERBill Chase

Wolsey-District 8

CHAIRMANDarrin Ihnen

Hurley-District 2

Mark KlumbMt. Vernon-Member at Large

Jim ThyenWaverly-Member at Large

Kurt StiefvaterSalem-District 3

Jason KontzBrookings-District 4

Gary DuffyOldham-District 5

David LeisethHayti-District 6

Bill WhippleWilmot-District 7

Chad BlindauerMitchell-District 9

Marv SchumacherPierre-District 12

Scott SperryBath-District 12

James KrierHerrick-District 14

INDUSTRY REPRESENTATIVES:Larry WagnerBjorn NelsonKent MulderTom Branhan

OFFICE STAFF:Lisa Richardson, Executive Director

Teddi Mueller, Legislative &Industry Affairs Director

Krystil Smit, Communications DirectorKatrina Luke, Office Manager

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MEMBERSHIPMATTERS

The South Dakota Corn GrowersAssociation is excited to announce record

level membership in the SDCGA following athree-month membership campaign effort.We want to thank and welcome all of youwho joined and renewed your membershipduring this successful membership drive!

In December, membership numbers skyrock-eted as the result of a telemarketing and letterwriting campaign and the momentum contin-ued into January and February. The SDCGAeven received an award from the NationalCorn Growers Association in December forhaving the highest membership increase forthe month out of all of the other NCGA stateorganizations.

As we approach 1,500 members in theSDCGA, the best is yet to come! The SDCGAis refocusing our membership efforts toinclude non-traditional ways of growing mem-bership, tapping into new resources andoffering membership benefits that will impactyour business and your lives. We will be doingmore telemarketing campaigns in comingmonths and will offer new incentives to be amember of the SDCGA.

One new membership perk is designed toaddress a huge need in rural America: healthinsurance. As self-employed business owners,agricultural producers must pay for healthinsurance on their own and many times thecost of carrying protection is burdensome.The SDCGA recognized a need in our mem-bers and while our role is not to offer a fullbenefits package, we have secured savings onbenefits enhancements. Soon, available onlyto members of the SDCGA, you will be able topurchase supplemental insurance throughAFLAC at lower premiums based on yourSDCGA membership. Watch for more detailsabout this program and how you can partici-pate in coming months.

We exceeded our goals with our membershipincrease over the past few months and nowwe have even loftier goals to bump SDCGAmembership over 1,500. With each new mem-ber, our strength and ability to impact issuesgrows. No where was the strength of SDCGAmembership more evident than at the SDCGAAnnual Meeting in January which saw recordattendance. In fact, two of South Dakota’sCongressional representatives, Sen. JohnThune and Rep. Stephanie Herseth, deemedthis premier event significant enough tohonor with their presence. It’s a strong mem-bership base that makes relationships withlegislators and industry representatives viableand with your participation, OUR STRENTHIS GROWING!

David Leiseth, Chairman, SDCGA Membership Committee

South Dakota Growers AssociationMembership Application

PLEASE HELP US DOUBLE OUR LOBBYING POWER TODAY!“You're just one corn producer. And so am I. But when we band together we can change things. We’ve proven

it over and over. So take a step for the future of your family. Join today!” -David Gillen, White Lake

nnnn $500 (Lifetime membership) *includes choice of 5 Seed certificates and $50 in Ethanol Certificates

I’ve enclosed: nnnn $150 (3-year membership) *includes choice of 3 Seed certificates and $15 in Ethanol Certificates

nnnn $75 (1-year) nnnn $75 (1-year state only membership)

Please fill in all fields.

First Name ________________________________ Last Name _______________________________________

Title ________________________________ Farm/Company Name ___________________________________

Membership is to be: (check one) nnnn Name nnnn Farm/Company Name

Address ____________________________________________________________________________________

City ______________________________________________ State ___________ Zip _____________________

County ____________________________________________________________________________________

Home Phone ____________________________ Business Phone ______________________________________

I am a Farmer nnnn Yes nnnn No Total Farm Acres ____________________ Corn Acres ___________________

Spouse’s Name ______________________________ Email: __________________________________________

Recruiter Name __________________________________ Phone: _____________________________________

Address ____________________________________________________________________________________

Mail Dues To: South Dakota Corn Growers Association3801 S. Western Ave., Suite 100, Sioux Falls, SD 57105605-334-0100 • www.sdcorn.org

SDCGA Seed Certificate ProgramWhen you sign up to join the SDCGA for 3 years or a lifetime membership, you have the option to receivehybrid seed corn discounts from these supporting seed companies, each worth $30 off a purchase of $100 ormore.

Your membership is important. Please take the time to join the SDCGA today. We’re working hard to add value to the product you grow, and we need your support.

3 year Membership. Please select 3 seed certificates.

PLUS! 3 year Receives $15 in Ethanol Enriched Fuel.TEAR HERE

This is your receipt for membership in the South Dakota Corn Growers Association. Contributions or gifts to theSouth Dakota Corn Growers Association are not deductible as charitable contributions for federal income tax pur-poses. However, dues payments are deductible by members as an ordinary and necessary business expense.

Received From:

______________________________________________________(Members Name)

Dues paid in the amount of $ _____________________________

Represented by: _________________________________________

Date __________________________________________________

South Dakota Corn Growers Association

3801 S. Western Ave., Suite 100 Sioux Falls, SD 57105

605-334-0100

( ) Black Diamond Seeds( ) Crows( ) Den Besten Seeds( ) Fontanelle Hybrids( ) Garst( ) Great Lakes Hybrids ( ) Hoegemeyer( ) Integra Seed

( ) Kaltenberg Seeds( ) Kaystar Hybrids( ) Legend Seeds( ) Mustang Seeds( ) Mycogen Seeds( ) Nortec( ) Pioneer Seeds( ) Production Partners

( ) Proseed( ) REA hybrids( ) Renze Hybrids( ) Seeds 2000( ) Stine Seed( ) Sucrosco Seeds

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The South Dakota Corn Growers Association wasawarded over $121,000 in grant money in the fall of

2004 through the USDA’s Risk Management Agency.Throughout the months of December, January andFebruary, the SDCGA put that money into motion byoffering educational opportunities to producers includ-ing Risk Management Seminars, Annual MeetingSeminars, Business Planning Workshops, FinancialPerformance Workshops and Computer Technologytraining. These informative events impacted over 700agricultural producers who attended the seminars.

Risk Management Seminars: Over 265 producersattended the SDCGA Risk Management Seminars, a pro-gram which traveled to four different locations in SouthDakota. The series started in Rapid City on Dec. 14,2004; hit Yankton on Dec. 15; moved to Mitchell on Dec.16 and wrapped up in Aberdeen on Dec. 17. Fiveexperts in the area of risk management strategies trav-eled to each location and educated producers on diversi-fication of assets, understanding contracts, adequateestate planning, the benefits of forward pricing, specialtycrops and insurance.

BusinessPlanningWorkshops:Producers attend-ing the BusinessPlanningWorkshops onJan. 18-19 inSioux Falls spenttwo days develop-ing an in-depth,three-to-five yearbusiness plan

designed to help participants focus on and achieve theirbusiness goals. Lead by Allen Lash, a widely recognizedleader in the area of financial management for agricultur-al producers and founder of AgriSolutions, the BusinessPlanning Workshops allowed producers to chart thefuture direction of their operation. The grant monies alsoallowed the SDCGA to award scholarships to the 40 pro-ducers who participated in the program to attend theclass for free, which was a $150 savings.

Financial Performance Analysis: Allen Lash ofAgriSolutions returned on Feb. 8-9, along with RogerBooth also of AgriSolutions, to train producers how toanalyze the financial performance of their operations.Using a producer’s own operation’s financial data, theclass capacity crowd prepared a historical farm financialperformance report that producers can use to identifypotential opportunities and areas in need of improve-ment. Again, scholarships were awarded to producerswho attended, waiving the $150 registration fee.

Computer Technology Training: The SDCGA identi-fied an unmet need in rural South Dakota by offeringComputer Technology Training on Feb. 14 at Lake Area

Technical Institute at Watertown and on Feb. 15 atDakota Wesleyan University in Mitchell. Both classesreceived an overwhelming response and registrationsfilled the class to capacity within a few days. Highlightsof the class included training on basic MicrosoftWindows applications, learning to use the Internet andemailing. In addition, participants learned practical waysto use the Internet in their farming operations and devel-oped marketing strategies using technology.

Annual Meeting Seminars: In addition to the aboveprograms, the grant monies were also used during theSDCGA Annual Meeting to offer seminars on marketing,ag policy and estate planning that more than 300 produc-ers attended.

SDCGA uses grant award to educate more than 700 producers

“Profitably Adding Valueto Local Agriculture”

Allen Lash

Vice Boddicker of Farmers Trading Company

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Meet your new SDCGA Board MembersM arv Schumacher and his wife,

Melanie, farm 12 miles north ofPierre, S.D. On their 1,800 acre farm,Schumacher grows about 500 acres ofcorn, 600 acres of wheat, 200 acres ofsoybeans, 200 acres of sunflowers andthe remaining acres are split betweenmillet, field peas and oats. The majorityof the acres are dryland; 400 are irrigat-ed.

Schumacher shares labor and equip-ment with this brother, who farmsadjoining land. Schumacher grew upfarming but rented his own groundbeginning in 1980.

“I enjoy the farming lifestyle, making decisions that affect my out-come and being my own boss,” said Schumacher. “When thework doesn’t get done, I know who to blame.”

Schumacher joined the SDCGA board in January of 2005. He alsoserves on the Hughes County Farm Service Agency board.

In his spare time, Schumacher enjoys spending time with his fami-ly which includes his wife and their daughter, Ariana; traveling,hiking, flying and golfing.

Schumacher says change is one of the most important issues fac-ing corn producers today.

“Adapting to constantly changing conditions and finding prof-itable ways to add value to our commodities is what farming is allabout,” said Schumacker.

K urt Stiefvater has a crop and livestock operation nearSalem, S.D., consisting of 750 acres of corn, 750 acres of

soybeans and 160 commercial stock cows.

Stiefvater started farming full time with his parents in 1997 afterattending Mitchel Vo-Tech and obtaining a degree in AgriculturalManagement. In 1995, he purchased the home quarter and theline of machinery from his parents.

“I always wanted to be a farmer to be able to plant seeds andnurture the crop to harvest,” said Stiefvater. “The outdoors andraising animals provides a feeling of success for me.”

Stiefvater came onto the South Dakota Corn Growers board inJanuary of 2005. He also serves as the Richland Township supervi-sor; officer of the McCook-Miner-Lake Cattlemen’s Association;chairman of the Farm Business Management Advisory Committee

at Mitchell Vo-Tech; member of theSoybean Association; and is a memberof the South Dakota Ag and RuralLeadership Class II.

Stiefvater says the most important issuefacing corn producers today is prof-itability.

“The challenge for today’s corn produc-er is to make a profit with the shrinkingmargins in corn production,” saidStiefvater.

Stiefvater and his wife, Kathy, have two daughters, Lauren andMegan. In his spare time, Stiefvater said he likes to spend timewith his family, reading and hunting.

Marv Schumacher

Kurt Stiefvater

SDCGA MONITORS PRESIDENT'S BUDGET

The South Dakota Corn Growers Association is diligently analyz-ing what implications the President’s proposed budget will

have on the Farm Bill and South Dakota corn growers. The SDCGAremains committed to ensuring that agricultural producers are on alevel playing field as the details of the President’s 2006 budget pro-posal are negotiated in coming months.

The White House has proposed cutting $587 million in farm pro-gram spending for fiscal year 2006, which would generate $5.7 bil-lion in savings to the Federal Government over the next 10 years.

“South Dakota producers understand that their future depends ona strong economy because when the economy is working, produc-ers see healthy demand for the products they produce,” said DavidGillen, White Lake, S.D. producer and president of the SDCGA.“Our number one priority is maintaining a safety net for producerswith our marketing loan rate. The SDCGA worked hard for produc-ers’ ability to update base and yields in the 2002 Farm Bill and wewill not falter in protecting producers’ interests in current andfuture farm policies.”

Elements that have the greatest potential of affecting producers’bottom line are the proposed reforms in the Commodity CreditCorporation including: lowering the payment limit cap for individ-uals to $250,000 for commodity payments, including all types of

marketing loan gains, as well as eliminating the three-entity-rule, basing marketing loans on historical production; reducing cropand dairy payments to farmers by 5 percent, requiring the dairyprice-support program to minimize expenditures, and extendingthe Milk Income Loss Contract program for two years.

Crop insurance and conservation programs are also named in theadministration’s budget plan and will face minor revisions. Thebudget includes proposals to enhance crop insurance coverage andreduce costs to deliver the program so that crop insurance willprovide coverage that is sufficient to sustain most farms in times ofloss.

The budget also proposed $3.8 billion to continue implementationof the conservation programs authorized in the 2002 Farm Bill. Indollar terms, the largest of these programs is the ConservationReserve Program, estimated at $2 billion in 2006, more than halfthe total. Also within that total, $72 million in additional resourcesare provided to extend the Conservation Security Program, intoabout 2000 additional watersheds in 2006. Funding in the budgetwill support enrollment of an additional 25 million acres in conser-vation programs, largely in EQIP.

“The SDCGA will be working closely with South Dakota’sCongressional delegation in coming months to ensure that a fairand fiscal plan is crafted for ag producers in South Dakota,” saidGillen.

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Ethanol Day at the state Capitol in Pierre, S.D.,offered an opportunity for corn and ethanol pro-

ducers to demonstrate the huge impact the ethanolindustry has on South Dakota.

The 4th annual Ethanol Day was held on Feb. 2 andmore than 80 corn and ethanol producers were pres-ent. The events were kicked off in the morning with alegislator briefing by members of the South DakotaCorn Growers Association, American Coalition forEthanol and the South Dakota Ethanol ProducersAssociation.

Following the briefing, a noon luncheon was heldinside the Capitol Rotunda where legislators, corn andethanol producers as well as ethanol supporters wereserved lunch. This offered an opportunity for state leg-islators and state office holders to converse with cornand ethanol producers on the importance of ethanolin the state as well as the growing industry.

The U.S. ethanol industry enjoyed record growth in2004. Annual ethanol production and usage were at alltime highs. More than 400 million gallons of ethanolwere produced in South Dakota alone. South Dakota'sethanol leadership is clear:

• #1 in the U.S. in farmer-owned plants • #1 in the U.S. in percentage of corn used • #4 in the U.S. in total ethanol production

“Ethanol Day at the Capitol exemplified to our stateleaders, the strength of the ethanol industry and thecollaborative support from many facets of business forcorn and ethanol producers in South Dakota,” saidDavid Gillen, president of the South Dakota CornGrowers Association and producer from White Lake,S.D. “We were able to make an impression upon legis-lators about the important role they also have in sup-porting this viable industry in South Dakota.”

Ethanol Day at the Legislature

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Brazilianagriculture tour

allows producers to analyze competition

Four directors from the South Dakota Corn boards traveled to BrazilJan. 15-28 to learn more about Brazilian agriculture. While in Brazil,

board directors Bill Chase of Wolsey, S.D., David Gillen and his wife, Carol,of White Lake, S.D., Reid Jensen of Burbank, S.D., and Paul Shubeck of

Centerville, S.D., toured crop and livestock farms, a packing plant, a port facili-ty and more.

Brazil is the fifth largest country in the world and is by far the largest country inSouth America. Its population is 175 million and among the major industries inBrazil is raising soybeans.

“Brazilian soybean production is definitely a competition but the country also hasmany challenges,” said Jensen, producer and SDCGA board member.“Transportation is a major problem with bad roads and there’s also environmen-tal pressure. Their environmental policies state that they must leave 20 percentof land in natural habitat.”

Corn production is less of an export competition than soybeans but Jensensaid the competition will come more in the form of corn marketed

through livestock; Brazil is a top exporter of beef. Brazilian agricul-ture is subsidized but mostly through reducing interest rates on

operating loans and machinery, and only for small farmers.

Jensen said that while Brazil is an export competitor,the low price of soybeans has discouraged the

clearing of new acres for agriculturalproduction.

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FARM BROADCASTER OF THE YEAR AWARDEvery year the South Dakota Corn Growers and SouthDakota Soybean Associations recognize an outstandingindividual and communicator for the Ag industry. The2004 media award was given to Jim Thoreson ofKWAT radio in Watertown, S.D.

Thoreson is a well-known radio personality who hasbeen on the airwaves for over 23 years. In addition tohis hourly market reports, his popular radio program, Ag Hour, draws loyal lis-teners daily. Ag Hour has been recognized as one of the top radio ag programsin the region.

This friend of agriculture says his goal has always been to provide the farm lis-teners with the most current information in markets and breaking ag news.He’s able to deliver on this goal through his many years experience communi-cating for the industry as well as the intimate knowledge he has through rais-ing his own corn and soybeans on the Thoreson Century Family Farm in theWillow Lake, S.D. area.

The SDCGA and SDSA want to thank Thoreson for his diligent reporting of agnews and for his dedication to the industry.

SDCGA Annual Meeting HighlightsRecord attendance at the South Dakota Corn

Growers Association Annual Meeting took the 18thannual event to new levels when 900 members andindustry leaders converged for the evening banquet andentertainment at the Sioux Falls Sheraton ConventionCenter on Jan. 8.

More than 300 producers attended the informationalseminars held throughout the day on Jan. 8. JulianneJohnston, senior editor for Pro Farmer, presented the“ABCs of Marketing,” followed by an ag policy update byAnne Simmons, professional staff member for the HouseAgriculture Committee. Soybean rust was also on theagenda; the update was provided by Martin Draper, asso-ciate professor and Extension plant pathologist at SDSU.And planning transfer and ownership of family farms wasdetailed by Ron Hanson, professor of agribusiness at theUniversity of Nebraska.

At Noon, the Corn Yield Contest (CYC) luncheon wasdedicated to recognizing the winners of the state CornYield Contest in 2004. The CYC is designed to applaudSouth Dakota corn producers for their productivity in thefield. This year South Dakota had over 100 producerswho entered the CYC. Not only do the producers com-pete on the local level, but at the national level as well.(See a list of CYC winners on page 11.)

The Annual Meeting was held in conjunction with theSouth Dakota Soybean Association once again this year,bringing together growers of the two main crop com-

modities in South Dakota. The boards of both organiza-tions met separately during the Annual Meeting toreview the successes of the past year and set new by-lawsand resolutions for the organizations for 2005.

“The Annual Meeting activities provide educational andentertainment opportunities but it’s also a time of settingpolicy and direction for the upcoming year for the SouthDakota Corn Growers Association,” said David Gillen,president of the SDCGA. “As a grassroots organization,gathering input and insight from producers is invaluableas we represent the corn producers of South Dakota inlegislative activities at Washington and Pierre.”

Following a day full of important educational offerings,an elegant evening banquet and entertainment, featuringa silent auction and diamond necklace raff le, topped offa successful Annual Meeting. Entertainment by AmericanIndian recording artists, Brulé, drew a record crowd.

Sen. John Thune, R-S.D., and Rep. Stephanie Herseth, D-S.D., were in attendance during the banquet and weregiven the opportunity address the crowd. Both spoke oftheir priorities specific to agriculture as they representSouth Dakota in Washington.

“We were honored that Sen. Thune and Rep. Herseth vali-dated the impact of agriculture by taking time out oftheir demanding schedules to attend the SDCGA/SDSAAnnual Meeting,” said Gillen.

• The South Dakota CornGrowers Association andthe South DakotaSoybean Association hon-ored Leon Wrage, for-mer Extension weed spe-cialist at SDSU, for hisimpeccable contributionsto agriculture.

• As Executive Director of both the SDCGAand South Dakota Corn Utilization Council,Lisa Richardson was recognized duringthe Annual Meeting for her many contribu-tions to the corn and ethanol industries.Her hard work and dedication were instru-mental in thedevelopmentof the ethanolindustry inSouth Dakotaand her knowl-edge in politi-cal arenas hasaffected legis-lation important to ag producers in SouthDakota, such as updates in bases andyields in the 2002 Farm Bill.

Career Service Awards

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GOLD SPONSORSBroin Companies

Farm Credit Services of AmericaGlacial Lakes Energy

Heartland Grain FuelsMonsanto

Pioneer a DuPont CompanySouth Dakota Corn Utilization Council

VeraSun EnergyWNAX Radio

SILVER SPONSORSAgrisolutions

American Coalition For EthanolBayer Crop Science

Dakota Ethanol DM&E Railroad Corporation

Eastern Farmers CoopFagen

Garst/AgriProGreat Plains Ethanol

ICM, Inc.James Valley Ethanol

Northern Lights EthanolSioux River EthanolTri State Neighbor

BRONZE SPONSORSAmerican Ag Network

Cammack Ranch SupplyCitizens State Bank of Sinai

Commodity Specialist CompanyCorTrust Bank

Country Pride CoopDakota Heritage Bank

East River ElectricEide Bailly LLPFarm Forum

First Dakota National BankGF Advertising

Gold County SeedsHarms Oil Company

Home FederalKMITKOKKKWATKXRB

Land O Lakes’ FeedLegend Seeds

Madison Farmers Elevator CoMustang SeedsNortec Seeds

Paulsen MarketingSecurity Bank & Insurance

Seeds 2000South Dakota Ag Producer VenturesSouth Dakota Pork Producers Council

South Dakota Wheat GrowersSioux Printing

Sioux Valley Energy Stine Seeds

Syngenta Crop Protection and SeedsVal-Add Service Corporation

Valley BankWells Fargo

Woods, Fuller, Shultz & Smith PC

ENTERTAINMENT SPONSORIntegra Seeds

WINE SPONSORGolden Harvest Seeds

DIAMOND SPONSORThe Diamond Room

Lauren Anderson of Dell Rapids, S.D.,and Mark Garber of Pierre, S.D., havecompleted their terms on the board ofdirectors for the South Dakota CornGrowers Association. They were eachpresented Retiring Director Awardsduring the Annual Meeting banquet.

LaurenAndersonhas servedon theSDCGAboard since1999. Duringhis time onthe board hehas come to be known as the person tocall when help is need. Anderson hasattended numerous legislative meetingsheld at rural elevators in the region andattended several other important meetingson behalf of the SDCGA.

With Anderson’s knowledge of the indus-try he has proved to be one of the bestmedia interview sources the SDCGA hashad. In fact, coupled with his excellentproduction practices, Lauren has been anadvocate for the industry by inviting andhosting media to his farm to witness firsthand, agriculture as its best.

The SDCGA thanks Anderson for his timeand dedication to the industry.

MarkGarberjoined theSDCGAboard in1999.Garberenthusiasti-cally took ongrowing themembership in the SDCGA, which hadfewer than 400 members at the time.Today the membership is reaching 1,500members and Garber’s dedication has con-tributed to this success. Not only hasGarber offered insight to the local mem-bership efforts but he also took on animportant leadership role nationally byserving as the Chairman for theMembership committee with NCGA.

Through the years Garber has served onthe SDCGA executive committee asChairman, Vice President and Treasurer.Garber has affected several pieces of legis-lation through his willingness to lobby andtestify at the state capitol in Pierre. He hasalso played an important role inWashington, DC by taking time to visitwith our national representation.

The SDCGA commends and thanks Garberfor the many impacts he has made forSDCGA and on behalf of the industry.

ANNUAL MEETING SPONSORS Retiring Directors Awards

New Legislative Award is given to Jim PutnamThe SDCGA introduced a new award during the CornYield Contest luncheon held at noon during the AnnualMeeting seminars. The new Legislative Award was devel-oped to honor a legislator who has gone over and abovethe call of duty for the agriculture industry.

The inaugural recipient of the SDCGA Legislative Awardwas Jim Putnam, R-Armour, S.D., State Representative forDistrict 19.

Putnam began working with the SDCGA in the 1988 leg-islative session. He worked diligently on passing the initialethanol producers incentive. He has been SDCGA’s leadsponsor on every piece of ethanol legislation over the past17 years. His commitment to the industry has been out-standing. Putnam has always been willing to fight thetough battles in his own caucus on behalf of the SDCGAand the ethanol industry.

As a thanks to Putnam for his dedication to the industry, the SDCGA presented him witha John C. Green print during the CYC luncheon on Jan. 8.

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Ethanol Performs

Aberdeen Huron

Ethanol takes center-ice atStampede Hockey game

The South Dakota Corn Growers Association spon-sored Ag Night at the Stampede Hockey game in

Sioux Falls on Jan. 7, the night before the SDCGAAnnual Meeting. Board members of the SDCGA andthe SDCUC took the opportunity to score points forethanol with a largely urban crowd.

Ethanol banners were prominent in the stadium as cer-tificates for $5 in ethanol were dropped from the airvia the Stampede’s motorized indoor blimp betweenperiods of the game. In addition, board members tookto the ice to throw “Ethanol What a Gas” t-shirts to thecrowd. Ethanol got another plug between periodswhen two directors were chosen to be human bowlingballs in a game of ice bowling of gigantic proportions.

The overall goal of the night was educating potentialnew users of ethanol and encouraging game-goers tofill up with ethanol.

T he planting season is right around the corner andthe South Dakota Corn Growers Association invites

members to consider becoming a showplot cooperator.

To become a showplot cooperator, you must be a mem-ber of the SDCGA, you cannot have refunded your corntax for the past three years and you must be willing toagree to the showplot rules.

The SDCGA showplots are an unbiased way to comparevarious corn hybrids side-by-side under growing condi-tions specific to that part of the state. After harvest,both raw and adjusted data is published in a showplotbook and is mailed to SDCGA members as a tool forproducers to use in selecting hybrids for the followingseason.

If you are interested in becoming a showplot coopera-tor, contact Katrina at the SDCGA office at (605) 334-0100.

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CORN YIELD CONTEST2004 STATE WINNERS

RANK/NAME/CITY

IrrigatedSOUTH DAKOTA1. Darrell Nelson, Yankton2. Riverside Farms, Huron3. Hattum Family Farms, Harrold

No Till/Strip Till IrrigatedSOUTH DAKOTA1. Randy Svendsen, Volin2. Randy Svendsen, Volin3. Randy Svendsen, Volin

No Till/Strip Till Non-IrrigatedSOUTH DAKOTA1. McKee Farms, Hawarden, IA2. Dwight Fickbohm, Akron, IA3. Keiser Enterprises Inc, Beresford

Non-IrrigatedSOUTH DAKOTA1. Dwight Fickbohm, Akron, IA2. Bosse Farms, Elk Point3. Jeff Hemmer, Dell Rapids

Ridge Till IrrigatedSOUTH DAKOTA1. David Ogle, Harrold2. Justin Ogle, Harrold3. Alec Solberg, Volin

Ridge Till Non-IrrigatedSOUTH DAKOTA1. Delmar Nelson, Yankton2. Alec Solberg, Volin

CORRECTION: Page 4 in the 2004 SDCGA Showplotbook was incorrect. Below is the correct page.

Become a SDCGA ShowplotCooperator for the 2005 Season!

Visit the SDCGA at:

www.sdcorn.orgFor complete showplot results

H H H H H

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The South Dakota Corn GrowersAssociation has been closely watching sev-eral pieces of legislation important toSouth Dakota producers during the 2005Legislative Session. Listed below are thebills that the SDCGA has been working onand the stage the legislation was in atpress time.

House Bill 1001 - An Act to revise thedefinition of arms-length transactions forthe purpose of assessing real property. (*Bill failed.)

House Bill 1003 - An Act to revise certainprovisions concerning the determinationof agricultural income values for classifyingnonagricultural acreages. (*Bill failed)

House Bill 1036 - An Act to revise certainprovisions regarding the determination ofagricultural income value for property taxpurposes. (*Bill failed)

House Bill 1098 - An Act to clarify provi-sions related to the terms of conservationeasements. (*Scheduled for hearing in theSenate Ag and Natural Resources commit-tee on 2/22.)

House Bill 1141 - An Act to revise certainprovisions relating to the assessment andvaluation of real property and to lower thegeneral fund levies of school districts.(*This bill died on the House floor.)

House Bill 1182 - An Act to establish arefundable checkoff program for cattle.(*Bill Failed.)

House Bill 1201 - An Act to revise thelabeling requirements for certain types ofmotor fuel. (*Signed by speaker.)

House Bill 1237 - An Act to reduce thefuel tax on biodiesel blend fuels for a cer-tain period of time. (*First read in Senateand referred to Transportation.)

Senate Bill 1 - An Act to revise themethod used to determine the capacity ofland to produce agricultural products.(*Signed by the Governor.)

THE OlingerR E P O R Tby Ron Olinger

A s we approach the last two weeks of the 2005 Legislative Session, I mustreport to you that most matters are moving forward quite appropriately,

including issues dealing with checkoffs for pulse and wheat, biodiesel legisla-tion and South Dakota Certified Beef.

The main danger to corn growers appeared in acts introduced from a summerstudy in both houses in the form of House Bill 1141 and Senate Bill 128.These bills would have drastically changed the taxing structure in SouthDakota. The South Dakota Corn Growers Association played a major role instopping these two bills.

Several years ago a bill was passed that indicated that if a sale of any land wasin excess of 150 percent of its assessed valuation, it would not be used foradjusting assessments. This applied to both agricultural and non-agriculturalproperty. For a county to adjust assessments based on sales, they needed tohave 15 arms length transactions. In the event they couldn’t find 15 sales theycould either use an income approach provided by statute or bridge to sales inadjoining counties. As time has gone on, more and more sales have beenthrown out and the result is any of our counties - and particularly West Rivergrass country and East River corn ground - are substantially under assessedbased upon the actual sales.

Over a period of five or six years, these bills would have thrown out the 150percent rule and in some cases, caused the taxes to nearly double in certainareas. In particular, areas where corn and beans are raised, 20 percent to 40percent tax increases were not unusual.

As time goes on the differentiation between the price that land is selling forand its assessed value continues to grow in those counties. Unfortunately,going to a revenue approach would ref lect the same type of gigantic taxshifts.

The problem with House Bill 1141 and Senate Bill 128 is that it would havecreated $3.4 billion dollars of new assessed valuation. And with no limitsplaced on spending out of funds other than the school general fund, $100million of capital outlay could have been levied as well as many other addi-tional levies than appear on your tax bill.

I think that we are going to see the end of gigantic rises in farm ground salesbecause of increased input costs, higher interest rates, lesser levels of federalcrop insurance, and lesser levels of government participation in the cropinsurance. This will make borrowing at the local bank more difficult and willstabilize land prices.

The proponents of these bills are largely more highly populated cities whowant these changes because it is a dramatic shift in tax burden from owner-occupied houses and commercial property to ag property. The South DakotaCorn Growers Association along with their membership will review this prob-lem and see if we can come up with a less drastic solution before the nextsession.

SDCGA Lobbyist–Pierre

Legislative Actions:SDCGA monitors keyproposals in 2005 StateLegislative Session

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NATIONAL LEGISLATIVE NEWS

I t may be a new year, but it’s the same old story for the nation’s corn growers.The 108th Congress adjourned in 2004 without enacting either of NCGA’s

longstanding legislative priorities – a comprehensive energy bill with theRenewable Fuels Standard (RFS) and a Water Resources Development Act(WRDA) authorizing new navigation locks on the Mississippi and Illinois rivers.Those two key pieces of legislation will again be on NCGA’s front burner in 2005as the 109th Congress progresses.

“We’re hopeful this Congress will get past the partisan gridlock that typifiedthe 108th Congress,” said Jon Doggett, NCGA vice president of public policy.“Our elected officials need to push party politics aside and get to work on leg-islation that is good for the country and good for corn growers.”

In addition to new locks and an energy bill, NCGA’s 2005 legislative agendaalso includes lobbying for increased funding for the maize genome sequencingeffort and protection of 2002 Farm Bill programs.

Ethanol

As crude oil and natural gas prices approach record levels, Congress and theadministration have already shown signs of tackling the divisive energy debate.

In his State of the Union address in February, President George W. Bush set thetone for energy discussions, stating that, “Four years of debate is enough – Iurge Congress to pass legislation that makes America more secure and lessdependent on foreign energy.”

House Energy and Commerce Chair Joe Barton (R-Texas) signaled that he maydo without a committee markup in favor of sending an energy bill straight tothe Rules Committee in preparation for f loor debate. Energy talks in the Househave slowed down in part due to uncertainty over how large the energy taxincentives package should be. Barton’s draft energy tax incentive package isthe same amount as the $23.5 billion that was part of the energy conferencebill in the last Congress.

In the Senate, Energy and Natural Resources Committee Chair Pete Domenici(R-N.M.) reportedly plans to unveil a bill soon after the Easter recess. Domenicihas promised to produce a slimmed-down energy bill, without some of themore controversial provisions that doomed the bill in the last session.

Through grassroots lobbying, NCGA will continue to promote the benefits ofsound national energy policy, Doggett said. “We’ll continue to support passageof a comprehensive energy bill that has beneficial provisions for ethanol, aswell as natural gas and other energy inputs used in production agriculture,” hesaid.

Lock Modernization

According to the Senate Environment and Public Works Committee and theHouse Transportation and Infrastructure Committee, a WRDA bill with lan-guage authorizing new locks could be marked up early in the 109th Congress.

Senate Transportation and Infrastructure Subcommittee Chairman Kit Bond(R-Mo.) and House Water Resources and Environment Subcommittee ChairmanJohn Duncan (R-Tenn.) are reportedly working on separate WRDA bills.Insiders expect the bills to resemble legislation introduced in the last congres-sional session with minor changes to Corps reform issues. Doggett said NCGAwas encouraged by the 108th Congress’ authorization of nearly $14 million inpre-engineering and design work for new locks, but growers won’t be satisfieduntil lawmakers approve and appropriate the Corps’ plan to upgrade importantwaterways infrastructure.

“As our international competitors continue to improve their transportationinfrastructure, it’s even more vital for U.S. producers to push for moderniza-tion of the locks and dams system that is such an important part of our nation-al transportation system,” Doggett said.

Senate Bill 2 - An Act to revise the proce-dure for assessing certain agriculture prop-erty. (*Passed House Taxation)

Senate Bill 3 - An Act to permit writtenstatements to be filed concerning the leas-ing of agricultural land and to provide forthe confidentiality and usage of such infor-mation. (*Died in the Senate TaxationCommittee.)

Senate Bill 4 - An Act to establish certainsubclassifications for agricultural property.(*Bill failed)

Senate Bill 5 - An Act to permit adjust-ment for certain factors that may affectthe agricultural income value of land. (*Billfailed)

Senate Bill 34 - An Act to make an addi-tional appropriation to construct a ther-mophilic anaerobic manure digestion sys-tem for the South Dakota AgricultureExperiment Station and to declare an emer-gency. (*Passed out of HouseAppropriations.)

Senate Bill 114 - An Act to establish arefundable checkoff on pulse crops. (*Firstread in House and referred to HouseAgriculture and Natural Resources.)

Senate Bill 128 - An Act to revise certainprovisions relating to the assessment andvaluation of real property and to lower thegeneral fund levies of school districts.(*This bill died in the Senate TaxationCommittee.)

Senate Bill 135 - An Act to increase thepromotional fee on wheat. (*Passed out ofHouse Ag and Natural Resources.)

Senate Bill 214 - An Act to provide taxa-tion benefits for certain soybean andbiodiesel facilities. (*Scheduled for hearingin the House Taxation Committee on2/22.)

Senate Bill 220 - An Act to establish theSouth Dakota Certified Beef program, tocreate the South Dakota Certified beeffund and to declare an emergency.(*Referred to the House State AffairsCommittee.)

14

in theIndustry

Û Crop ValuesUSDA is out with its crop values report.These numbers are used by the FarmService Agency for the crop disaster pro-gram. The law specifies the combinationof disaster payments and crop insurancepayments are not to exceed 95 percentof a crop’s value. The U.S. value for cornis $1.95 a bushel. It is $3.45 for springwheat and $3.95 for durum. Soybeansare valued at $5.10 per bushel, canola at$11.20 per hundredweight and dry ediblebeans at $24.80 per hundredweight.Crop values vary by state.

Û LDP TotalsFarmers have received nearly $2.5 billiondollars in loan deficiency payments onlast year’s corn crop. Almost 8.8 billionbushels have been LDP’ed with an aver-age of 28 cents per bushel. One-point-three billion bushels of 2004-crop soy-beans have received LDPs totaling $275million dollars. The average payment is 21cents. The wheat LDP averaged 17 centson a total of 403 million bushels.

What'sUp

Û NASS Finds 1 Million MoreFarmers

The National Ag Statistics Service says theCensus of Agriculture only identified pri-mary farm operators and not the givennumber of producers on a farm or ranch.That means there are 3.1 million farmersnationwide, a million more than previouslythought. By commodity, NASS found beefcattle producers average out to be the old-est sector. Pork producers are theyoungest.

Û New Rural Working GroupCo-Chair

South Dakota Congresswoman StephanieHerseth is the new co-chair of the HouseDemocratic Rural Working Group. Thiscoalition works to make rural issues partof the national debate in Washington,D.C.

Û Another Ethanol RecordThe U.S. ethanol industry enjoyed recordgrowth in 2004. During the NationalEthanol Conference, the Renewable FuelsAssociation touted record annual ethanolproduction and usage.

Û A-40 Cattle Approved byJapanese Panel

A Japanese government panel has accept-ed the U.S. system of verifying the age ofcattle. The panel put its support behindso-called A40 cattle. That grade of beefprimarily comes from cattle 12 to 17months of age. “It’s not any where nearwhat we expected and what we hopedfor, but it is a start and that’s a processwe have to work through,” said Phil Sengof the U.S. Meat Export Federation. Thepanel discussion still needs the approval ofthe Japanese government.

Û Ag Tax Credit IntroducedThe Agricultural Retailers Association ispleased with the introduction of theAgricultural Business Security Tax CreditAct. The tax credit will help provide agri-cultural business owners with the fundingto take proactive security steps needed tobetter protect the U.S. agriculture andfood system.

Û Livestock producers haveuntil April 30, 2005, to signup for the EPA's voluntaryAir Quality ComplianceAgreement

SDSU Extension Swine Specialist BobThaler and SDSU Extension Farm SafetySpecialist Dick Nicolai said theEnvironmental Protection Agency (EPA),working with several livestock commoditygroups, has developed the Air QualityCompliance Agreement to address airquality concerns from livestock operations.

For the next two years, research at sev-eral universities will quantify the amounts ofammonia, hydrogen sulfide, particulate mat-ter (dust), nitrous oxides, and volatile organ-ic compounds being emitted from differenttypes of livestock operations. The data,once summarized, will give EPA new toolsto use in the future in identifying violators,who will be subject to fines and mandatorycleanup.

To help livestock producers in thisprocess, the EPA has developed the AirQuality Compliance Agreement. The volun-tary agreement provides livestock producerswith legal protection from past and currentviolations of the Clean Air Act. By signingthe agreement, the producer does notadmit any guilt for alleged violations from2007 backwards and will be exempt fromany past violations. However, producersmust pay a fee of $200 to $100,000 basedon the size and number of farms. The feefor most farms in South Dakota will fall inthe $200 to $500 range. Two Web siteswith more information are www.epa.gov/and www.nppc.org/.

Û Air Quality GrantsThe USDA has awarded $5 million dollars inair quality grants to 11 institutions. Theresearch will study the impact of air qualityresulting from farm animal operations,greenhouse gases, emissions from post-har-vest practices and improved air qualitymeasurement methods.

Û SD Senate Ag CommitteeApproves Establishment of SDCertified Beef

The initiative passed the committee with a6 to 2 margin. South Dakota Farmers Unionlobbyist Mathew McLarty was among thosetestifying in favor of the bill. “South DakotaCertified (Beef) will soon take its place withthe Iowa chop, the Maine lobster and theIdaho potato - I think this program opens itsdoors to all levels of cattle producers and isa pro-family farm bill that is going to raiseall ships in the cattle market in the state.

Û State Checkoff IssuesThe South Dakota State Senate has passeda one-half cent increase in the state wheatcheckoff. That bill still needs to movethrough the state House.

Û Pork-The Other Ad SloganThe National Pork Checkoff will soon rollout a new ad campaign. National PorkBoard President Dave Culbertson says it wastime to re-energize the ‘Pork, the OtherWhite Meat’ campaign. “Pork, the OtherWhite Meat has been one of our shiningstars -- it is one of the five most highly rec-ognized tag-lines in advertising,” saidCulbertson, “We challenged several adagencies to build on that campaign.” Thenew campaign will be unveiled during theNational Pork Forum in early March.

15

EXPORT UPDATE• The poultry sector in India is showing greatgrowth potential in 2004/05. The Indian poultry sectorhas grown to more than 1.55 billion in broiler production,reports Amit Sachdev, the U.S. Grains Council’s representa-tive in India. This growth is due to an increasing numberof farms contracting with breeding companies. He alsoreports that agricultural food policy needs to focus on theprocessing sector by implementing an inspection pro-gram, an investment policy enabling the private sector tobecome involved in processing plants and a tax exemptionpolicy allowing the industry to grow. Council representa-tives feel increased per capita income will boost the con-sumer demand for poultry, which may in turn increase thedemand for corn. With the current 15 percent tariff andimplementation of the tariff rate quota, India’s last U.S.corn imports were in 1999-2000.

• Biotechnology is in a “frozen state of coverage”when it comes to the media, says one expert speakingat the U.S. Grain Council’s 45th Annual MembershipMeeting held in Huntington Beach, Calif., recently. WillyDeGreef, an independent consultant, told Council dele-gates that negative media coverage of genetically modified(GM) crops is so prevalent, the general public assumes that“negative” is the only status of GM crops. “The public per-ceives biotechnology as being at a dead end and they don’tsee the success stories of the commodities,” said DeGreef.“For example, it’s projected that in 2005 more than half ofthe corn planted in the United States will be GM corn.”DeGreef told listeners that they are the key to turning themessage around. “We have to talk about our experienceswith biotech crops,” he said. “Public perception can bechanged with media exposure.”

• Looking for positive, educational and easy-to-

understand information on biotechnology? Go towww.grains.org/brc to view a new series of videosproduced by the U.S. Grains Council. These streamingvideo segments highlight the use of biotechnology cropsand genetically modified (GM) production tools in the U.S.grain handling system. The videos explore the impact thatbiotechnology has on farmers and also addresses the politi-cal, environmental and socioeconomic issues surroundingthe use of biotechnology crops.

• The U.S. Grains Council needs to be aggressive indefending its market share in Japan. That’s the mes-sage delivered by Cary Sifferath, the Council’s Tokyo direc-tor recently. Sifferath looked at both opportunities andchallenges in Japan, the country that holds the largest mar-ket share for U.S. corn and barley. “We have competitors inChina, Australia, Canada and Eastern Europe,” he said. “Weneed to defend our markets against these threats.” In FY2004, Japan imported 615 million metric tons of U.S. cornand 7.3 million tons of U.S. barley.

• Collaboration among several industries in Japanhas led to a new corn publication. The U.S. GrainsCouncil, along with member companies of the Japan CornGrits Association and faculty of the Japan Institute ofBakery, recently produced a publication titled, Corn BreadGuidebook. This book introduces the Japanese bakeryindustry to additional food uses for corn and containsrecipes for traditional American cornbread, yeast breadsand sweet cakes. The brochure was distributed in hopes ofcurbing the decrease in food corn consumption, whichwas below 150,000 metric tons in 2003 due to shrinkingusage in the beer and snack industries. Ten years ago, cornfood imports were over 350,000 tons.

CROCKPOT CHEESY CREAMED CORNA nice departure from just plain old corn! Wonderful sidedish for the Holidays or a special Sunday dinner. Make surethat this cooks for no longer than 4 hours, and those withtempermental crockpots may want to check after 3 hours.

3 (16 ounces) packages frozen corn1 (8 ounces) package cream cheese, cubed 1 (3 ounces) package cream cheese, cubed 4 tablespoons butter, cubed 3 tablespoons water3 tablespoons milk2 tablespoons sugar6 slices American cheese, cut up

Combine all ingredients in slow cooker. Mix well.Cover and cook on LOW for 4 hours.

“CORNY”COOKING

CORN & BROCCOLI BAKE 1 (8 ounces) box Chicken In A Biscuit crackers, crushed 1/2 cup butter or margarine, melted 1 (10 ounces) package frozen chopped broccoli, thawed 1 (15.25 ounces) can whole kernel corn, drained 1 (14.75 ounces) can cream-style corn 1. Combine cracker crumbs and butter, and reserve 1/2cup for topping. 2. In bowl, combine broccoli, both cans of corns andremaining crumbs. 3. Transfer to a greased 2 qt. baking dish. 4. Top with remaining crumb mixture. 5. Bake, uncovered@ 375 degrees for 25-30 minutes oruntil lightly browned.

MARCH 16-18, 2005NCGA Corn Board Meeting Washington, DC

MARCH 19, 2005Ag Day at the WashingtonPavilionSioux Falls, SD

MARCH 20-26, 2005National Ag Week

APRIL 19-21, 2005NCGA April Staff MeetingSt Louis, MO

MAY 25-27, 2005USMEF Board of DirectorConferenceWashington, DC

JUNE 20, 2005Corn Cob Open GolfTournamentEdgebrook Golf Course,Brookings, SD

JULY12, 2005NCGA Action Team MeetingWashington, DC

JULY 13-14, 2005Corn CongressWashington, DC

JULY 24-26, 2005USGC Board of DelegatesConferenceSeattle, WA

SOUTH DAKOTA CORN TALK is pub-lished by the South Dakota Corn GrowersAssociation, a non-profit South Dakotaorganization. Any articles pertaining tocorn, corn products and the corn industryare encouraged and welcomed.

CCalendar of EventsSouth DakotaCorn Growers Association3801 S. Western Ave., Suite 100 • Sioux Falls, SD 57105605-334-0100 •Fax 605-334-0505

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