Most farmers are aware of the traditional benefits of belonging to a cooperative. Relationships, products and services go a long way in building stronger farming operations and securing the future of agriculture. Being a customer of a cooperative also offers an opportunity to share in the collective successes of the group, including capital. Patronage is the name for the capital that a cooperative returns to its customers.
This month, Farm Credit Mid-America will return $200 million in patronage to eligible customers across Indiana, Ohio, Kentucky and Tennessee. That brings the total capital returned to its customers over the last five years to $648.5 million. As a farmer-owned cooperative, the Association understands that a little extra capital can make a big difference in paying for new equipment, helping with operating costs for the upcoming season, meeting payroll and more.
“While COVID-19 prevented our team members from physically celebrating Patronage Week in our offices, and delivering many of these checks in person in 2020 and again in 2021, we are proud these dividend returns arrived at a time when they are truly needed,” says Bill Johnson, Farm Credit Mid-America president and CEO. “Patronage is a powerful benefit of belonging to a cooperative, and we’re fortunate that our strong financial position ensures we can continue to provide reliable credit through good and challenging times, now and into the future.”
Returning Patronage is a decision Farm Credit Mid-America’s Board of Directors considers and makes each year. It is not a guaranteed payment, but rather a return of earnings paid to Patronage-eligible customers, according to board resolution. Information about Patronage and eligibility may be found by visiting e-farmcredit.com/about/patronage. Patronage is based on each customer’s contribution to the net income of the company - specifically a customer’s contribution to net interest income and origination fees- in proportion to the Association’s total net interest income and origination fees.
Farm Credit Mid-America knows patronage is appreciated, given customer feedback received:
“Thanks to the board of directors. Really helps to know Farm Credit Mid-America supports my business. I will continue to rely on you for my current and future financial needs…” And, “The patronage check came at a great time. It helped our operation through a period of tight cash flow. I really appreciate [Farm Credit Mid-America for] supporting a strong patronage program without sacrificing their ability to keep competitive on loan rates…” And, “Patronage is a product of a well-run, farmer-owned co-op. I appreciate the board’s keen attention to being good stewards of member capital…”
In addition to patronage, customer-owner benefits of belonging to the Farm Credit Mid-America include participation in its Nominating Committee, Board of Directors and annual elections as well as voting on issues that influence operations.
For additional information about Farm Credit Mid-America and its Patronage Program, visit https://e-farmcredit.com.
