Equity 'looking ahead' from challenging times

Ray Mueller
Now Media Group


The upcoming months are "not looking rosy" for agricultural commodity, livestock, and milk prices "but we've been here before," Equity Cooperative Livestock Sales Association district 3 director Steve Schleis of Kewaunee told attendees at their 2016 annual meeting.

That outlook doesn't mesh well with the cooperative's "Looking Ahead" motto for the year, but Schleis noted that the motto addresses ongoing and planned changes within the organization that is the second largest of his kind in the nation. Equity operates 12 auction markets, three buying stations and other livestock marketing programs in Wisconsin and adjacent parts of Iowa and Michigan.

2015 market statistics

During 2015, those facilities and marketing programs handled the sale of 805,819 animals — 711,334 cattle and calves (down 5 percent on the cattle from 2014 and up 10 percent on the calves), 54,179 hogs (up 4 percent) and 40,306 sheep and goats (down 5 percent).

Those animals were worth at total of $753,839,990 to the producer sellers, Equity's vice president for finance Nancy Bilz reported. This was down by $20 million from 2014 because of a steady decline in prices during the latter half of the year, she noted.

Another noticeable change for Equity in 2015 was a decline of just over $6.9 million in its total assets at the end of the year. That new total of nearly $34.541 million was affected by the $7.5 million increase in the livestock credit program loans during the year while the patron equities rose by $876,026 to nearly $7.259 million. There was a strong demand for credit program, Bilz noted.

Meanwhile, Equity's operating expenses were up by 9.6 percent during 2015, contributing to a net proceeds total of $664,880 for the business year compared to nearly $2.074 million in 2014.

Equity chief operating officer Chuck Adami pointed out that a portion of a the drop in net proceeds was due to the hiring of new employees for the sales force, the upgrading of the computer information system, and to preparing for business growth. He also cited the higher costs of observing rules and regulations on the marketing of livestock.

Searching for sustainability

During his annual report at district meetings, Adami considered the buzzword of "sustainability" and how it applies to Equity and its patron members. He noted that what the word means is the use of resources in ways that avoid depleting or destroying them.

What's important for Equity is how its customers and society in general view the cooperative's practices, Adami stated. The zealous actions and declared intentions of some of those customers such as restaurant chains "have created an issue that they cannot solve but maybe we can help," he commented.

At Equity's 10 district meetings in March, Adami challenged members to share what they are doing or planning to do on their farms in the name of "sustainability," which he indicated "is a journey, not a destination." Among the replies he received at the meeting here were forward contracting for milk prices, dividing the dairy herd into feeding groups to lower input costs and applying manure evenly on the farm's land.

In addition to getting farmers to think along those lines, Adami explained that a request of his standing request is to provide input for the National Council of Farmer Cooperatives. He said the organization needs evidence to show its customers that sustainability is being taken seriously by its farmer members.

Cooperative's changes

Within Equity, one recent change has been the opportunity for direct bank deposit to members for their livestock sales. Bilz announced that 80 members have chosen that option. She reported that the issuing of Equity credit cards is still a project awaiting action.

Another change which Equity's directors are considering and which would require a bylaw change would be the election of district directors via a mail ballot rather than at the district meetings. Members were asked for feedback during the meeting and on a printed questionnaire which addressed 21 topics.

It was noted that a few other cooperatives have gone the ballot by mail route for electing a district director and have enjoyed up to a 20 percent return by eligible voters. Based on the attendance of voting members at the meeting here, Equity is electing its directors with votes cast by about 1 percent of its nearly 30,000 patrons.

During the election for district director here, Schleis survived a challenge by Andy Schuh of Brillion and Randy Bubolz of Reedsville to earn his 4th three-year term on the Equity board. Bubolz was selected as the alternate director.

Market schedule changes

Reedsville auction market manager Andy Bubolz, who took that position after Greg Cummings died in 2015, noted the new auction schedule at the facility — hay on Wednesdays; dairy cattle on the first and third Thursdays; and feeder cattle on the second and fourth Thursdays.