Nov 02, 2020
By: Jonathan Olmscheid, Chief Financial Officer
First off, I would like to say “THANK YOU” to the UFC employees and membership for continuing to support the Cooperative during the ever evolving COVID times which have impacted all of us in our own unique ways.
I have learned a great amount about the UFC businesses, culture, dedication to communities, and overall strategies since joining the team in February. One of the greatest assets in my opinion is the adaptability
of the UFC team in every aspect from adverse COVID working environments to the difficult decisions resulting from a focus on core businesses over the course of the last 18 months. Many of these events have provided opportunities to improve the efficiency and effectiveness of processes and techniques throughout the entire company.
One of the key objectives of the financial department is to best position the Cooperative from a cash position to be able to take advantage of business opportunities when they present themselves, this could be as
simple as purchasing a truck outright to prevent lease fees to having several million dollars’ worth of grain storage carried over a growing season to capitalize on the market price improving overall profitability. UFC has taken several actions to reduce its short-term borrowings including reducing inventories and selling properties that were no longer supporting current UFC operations. Just as all of you look at your financial position and if you have applied for a loan that required comparing monthly bills to cash coming in or comparing total debt to total income for a given year, UFC has similar factors that are key in assessing financial strength which all come back to cash. Therefore, because UFC was able to significantly reduce the amount of cash borrowed year over year, we can very proudly say that the financial strength of UFC has greatly improved and is very strong currently.
There are many ways in which members can aid in cash management of UFC but one that has several operational efficiencies is to pay your balances due on-line electronically. This allows funds to transfer in a timely manner and are posted automatically to their account without the need of a UFC employee to apply the payment. On the opposite side of funds going out to you via ACH verses check, the benefit is the same with the timeliness of funds but also reduces the time of UFC to clear the payment at the end of each month if or when the check is cashed. This also helps UFC better manage cash, for an example, there were just under $3 million in uncashed checks outstanding at the end of September with roughly $2.1 million of those being grain checks from August and September.
In an effort to assist UFC with these much older outstanding checks, a letter was sent to notify those known outstanding check holders. Starting December 1st, please visit our website to view a list of customers and vendors who have money owed to them in the form of old uncashed checks prior to January 1, 2020. These funds are the result of uncashed checks (possibly lost) for patronage, grain sales or accounts payable invoices.
Per our bylaws: in accordance with Minnesota Statutes 1986, Section 308.12, Subd 5, this association may distribute any unclaimed property which has been reported as unclaimed property to the Commissioner of Commerce of the State of Minnesota, to a corporation or organization which is exempt from taxation under Minnesota Statutes Section 290.05, Subd. 1, paragraph (b), or 2. The rights of an owner to unclaimed property shall be extinguished upon the disbursement of the property to a tax-exempt organization in accordance with Minnesota Law.
In closing, UFC is striving to adapt to the ever-changing markets we conduct business and we ask that all of you assist in the process as well, utilizing the tools developed accessed through the UFC website. UFC’s financial health and future outlook has improved over the last year and the focus of the UFC team is to continue on the path going into the 2021 year.
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With our extended weather forecast showing below normal temperatures across much of UFC’s territory we know growers may not be waiting for “ideal” planting conditions. We suggest utilizing 6-24-6 starter fertilizer to help corn and soybeans deal with cooler planting temperatures.