Partnership Perils: A tale of two cities Troy Upah Ag Partners, LLC Albert City, IA

7 th Annual Farmer Cooperatives Conference November 1, 2004

 September 1, 1997  2 Owners – 50% Private / 50% Co-op  13 Facilities in NW Iowa – 4 Rail Lines  Grain, Agronomy, and Feed  165 Employees  $150 Myn Business  LLC Structure A Unique Joint Venture

Albert City Elevator, An Iowa Co-op  Started 1905  900 Farmer Members  9 Member Board  9 Locations  100 Employees  Financial Strength

Cargill, Inc.  Started 1865  101,000 Employees – 59 Countries  Cargill Grain Division –Now Cargill Ag Producer Services  Northwest Iowa –4 Locations –65 Employees

Accomplishments Completed 03/98 – 16,000 Tons

Accomplishments  New Culture  Improved Efficiencies  Company Investments  Positive Results  “Evergreen” Agreement Agreement 1 of 5 Bulk Seed Sites

Partnering with Investor Firms

The Value of An Investor- Owned Partner The Ag Partners’ Experience

Operating Independently Guidelines:  Safety Requirements  Spending Limits  Annual Budget –Profits and Capital Spending  Strategic Planning  Quarterly Board Meetings

A Stronger Board of Directors 3 Alceco - 3 Cargill  Years of Experience  Ag Industry Knowledge  New Challenges  Outside Perspective  Vision  Autonomy Phosphate Mine Tour

Shared Priorities  Safety  Communities - Image  Earnings  Knowledge Gain  Long-Term Vision  Strong Relationship

Decision-Making Process  Earnings Impact –Feasibility Studies  Business Centered  Sensitive to Local Concerns

Access to Resources  Capital  Risk Management Tools – Grain  Feed Systems  Benchmarking

Market Support  Rate Negotiations  Equipment Vendors  Suppliers –Feed Ingredients –Agronomy Products  Market Information

Community Support  Student Scholarships  Fire Departments  Libraries  Hospitals  Schools

Improved Market Access  Fertilizer Procurement –Phosphates –Nitrogen –Specialty Products  Grain Markets  Feed Ingredients

Capturing Efficiencies  Sharing Equipment –Conveyors –Terragators  Sharing People –Applicators, tender drivers, etc.  Sharing Ideas –Market Approach

Results  Financial Success  Growth  Safety Results  Employee Satisfaction

Challenges  Initial Customer Concerns  Market Perceptions  Supplier Misconceptions Alta, IA

An Albert City Elevator Perspective “There is no doubt that our partnership with Cargill has created increased value for our members and our cooperative.” Jim Franzmeier, Board Chairman

Thank You!