When United Farmers Cooperative (UFC) and Waconia Farm Supply (WFS) looked at merging earlier this year, one of the promises UFC made to WFS members was that if the merger happened, UFC would retire the equity of all WFS members that held equity and had turned 69 years old by Aug. 31, 2013.
The merger did happen, becoming official on Sept. 1, and last week, UFC delivered on the promise it had made during a WFS dinner meeting held at the Hamburg Community Hall on Wednesday, Dec. 18.
Approximately 350 people attended the meeting, which was dubbed a “Celebration of WFS.” After dinner, attendees listened to a presentation led by the WFS board, which reviewed the financial results of WFS in its final year of operation (a time period of 11 months ending Aug. 31, 2013) before distributing almost $250,000 in cash equity retirement checks to eligible WFS members.
“Waconia Farm Supply has long been a successful business but this past year, it did suffer some losses due to the short year and on-going challenges that have been a part of Waconia Farm Supply these past few years,” said Jeff Nielsen, General Manager / CEO of UFC, who acknowledged that WFS has experienced several years of losses and it has struggled to provide members with equity retirement checks and, in the case of some recent years, patronage checks.
“However, the main purpose of the event held in Hamburg was to celebrate the 65 year history of Waconia Farm Supply and most importantly, to honor the commitment that was made last spring to retire the local equity of all Waconia Farm Supply members that held equity and who had turned age 69 by Aug. 31 of 2013,” Nielsen said.
Although UFC usually mails these types of checks, Nielsen said UFC wanted to make a public statement about keeping its promise to WFS members. At the meeting, $249,415 in Local WFS retirement equity checks were distributed. The checks were given to WFS members who turned 69 before Aug. 31, 2013 alongside members who were older than 69 but had yet to receive an equity retirement check from WFS.
The next day, UFC mailed approximately $200,000 in UFC Equity (sent to UFC members who turned 69 by Aug. 31, 2013) and in the spring of 2014, UFC will pay out approximately $650,000 in Regional Equity, meaning many of the people who received checks at the meeting in Hamburg will receive another check next spring.
Although the check distribution was likely the highlight for many attendees, the event also served as a way to inform members about the latest news involving UFC as it moves into 2014.
Nielsen explained that UFC has purchased nearly $3.5 million worth of new equipment, trucks and rolling stock, and has several expansion projects in the works.
One of those projects is a new Ag Service Center that will be located in Hamburg. The center will consolidate UFC’s current operations in Hamburg and New Germany. At this time, UFC operates a fertilizer plant, seed warehouse and feed warehouse in Hamburg and an anhydrous ammonia fertilizer plant in New Germany.
The new center will also be used to house additional liquid propane gas, an arrangement that will be used to enhance UFC’s ability to serve customers during peak demand times.
It’s unclear how many jobs the new center might create but Nielsen estimated that as a whole, UFC is expected to grow from 260 to 350 employees across its 28 communities by the end of next year.
UFC is looking at several sites in Hamburg and Nielsen expects to break ground on the new center next spring. In the meantime, UFC will continue to operate all existing facilities until the new center is up and running.
Another project of local interest is a major expansion of the Cologne Mill. According to Nielsen, UFC has purchased several lots adjacent to the mill and the project will result in additional warehouse space and feed and mill capabilities along with improved grain handling facilities. Nielsen said this project, which will be completed in three phases, will be developed and completed within the next one to two years.
Also during the meeting, UFC board and management team members shared some of the strategic initiatives that are being pursued to improve the long-term strength of the cooperative.
One initiative is the re-identification of some of UFC’s facilities, including WFS and UFC’s divisions in Maple Plain, LeSueur and Burnsville. All four divisions will operate under the name “UFC Farm Supply” and use a new logo that looks remarkably similar to the current WFS logo. Nielsen said the design of the new logo was based on the current WFS logo as a way to honor the heritage and history of WFS. The new name and logo are being implemented now and the transition to new signs, uniforms, etc., should be complete by mid-January.
Although the merger between UFC and WFS continues to be a work in progress, Nielsen is excited for the future of WFS as it continues to become more integrated into UFC.
“At the end of the day, Waconia Farm Supply is part of UFC. We are one company and all of our members are going to benefit from this,” he said.
“We are excited to offer enhanced customer service and more products to serve our customers better,” added Dean Meyer, the Director of Consumer Goods & Retail at WFS. “We look forward to continuing to grow and support our community.”
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Contact Todd Moen at email@example.com