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February, 1953 



THE I. A. A. RECORD 



Page Eleven 



Pres. Smith Reviews Year*s 

 Work 



(Continued from page 7) 



Auditing Association 



"During the year, the Illinois Agri- 

 cultural Auditing Association has com- 

 pleted 366 audits for its members and 

 shows an increase in membership of 13. 



Reinsurance Company 



"The Reinsurance Company closed 

 the year with an increase in the volume 

 of its direct and specific fire and wind- 

 storm insurance, but a substantial de- 

 crease in hail insurance, largely due to 

 the reduced per unit value- of insured 

 crops. 



"There is a school of thought fast de- 

 veloping which believes the company's 

 operations should be changed to a basis 

 comparable to other legal reserve 

 mutuaLs, whereby insurance is written 

 at conference rates and in addition 

 provide that savings and/or earnings 

 be paid back to policy holders in divi- 

 dends at time of renewal. Levying of 

 assessments, particularly special assess- 

 ments, always leads to disturbance and 

 misunderstanding. With such a change 

 in policy, the savings brought about as 

 the result of organized effort would be 

 apparent at each premium paying date. 

 This matter is receiving attention of 

 the management. Recommendations for 

 changes, if any, will be made at an 

 early date. 



Farm Supply Company 



"The Illinois Farm Supply Company 

 enjoyed the best year in its history. 

 Prom an organization six years ago 

 consisting of six charter members and 

 less than a dozen bulk plants, it has 

 grown to 52 members with 135 bulk sta- 

 tions, operating 385 trucks and serving 

 approximately 75,000 farmers in 80 coun- 

 ties. It is the largest association of its 

 kind in the United States. The volume 

 of petroleum products and farm sup- 

 pUes distributed exceeds that of any 

 other group of farmer-owned and oper- 

 ated companies. 



"During 1932, the company handled 

 35,000,000 gallons of petroleum products 

 approximating a train-load every other 

 day with a retail value of $5,000,000. Its 

 earnings last year were equal to 112.4 

 per cent on capital stock, and besides 

 adding substantially to its surplus the 

 company returned $86,514 to member 

 companies. 



Auto Insurance Company 



"The Illinois Agricultural Mutual In- 

 surance Company has continued to ren- 

 der outstanding service to its Farm Bu- 

 reau member policyholders. It is always 

 difficult to compare costs with other com- 

 panies, for the reason that there are 

 many tsrpes of policies and many 

 methods of operation. It is without fear 

 of contradiction, however, when I say 

 that this company is now saving its 

 policyholders more than one-quarter 

 million dollars annually on auto insur- 

 ance alone compared with the cost 

 of similar insurance in any other com- 

 pany operating throughout Illinois. 



"Although It has experienced a 



greater number of cancellations than 

 in any previous year, largely due to 

 economic conditions, the company 

 closed tl^e year with a net increase of 

 983 policies in force. As will be noted 

 from the financial statement, the com- 

 pany is In a splendid financial condi- 

 tion, having added $109,622.56 to its sur- 

 plus in 1932. 



Life Insurance Company 



"The Country Life Insurance Com- 

 pany has made an enviable record dur- 

 ing the year. New paid-for business 

 approximates $10,000,000. The net in- 

 crease over that of a year ago Is $3,600,- 

 250, showing a net Insurance In force 

 at the close of the year of $47,368,250.00. 

 Pew legal reserve companies, if any, 

 operating in the United States, will 

 show a net gain in insurance in force 

 for the year. Country Life's mortality 

 experience has been much better than 

 anyone anticipated, approximating only 

 25 per cent of the expected, which Is 

 the lowest annual mortality in the ex- 

 perience of the company. 



"As previously stated, the financial 

 condition of Country Life Insurance 

 Company is all anyone could possibly 

 expect or ask, and fully Justifies the 

 continuing confidence of its policyhold- 

 ers. 



Produce Marketing Ass'n. 



"The Illinois Produce Marketing As- 

 sociation last year handled approxi- 

 mately 2,500,000 pounds of butterfat, 

 having a value of $471,072. 



"Because of the steady increase In 

 surplus milk within several of the Illi- 

 nois milk sheds and its resultant effect 

 upon butterfat prices, our Dairy and 

 Produce departments have been direct- 

 ing their attention during recent 

 months toward the development of a 

 program which provides for surplus 

 plants equipped to separate milk and 

 manufactiu-e the cream into butter. 

 Such plants likewise will offer a market 

 for cream handled by the produce asso- 

 ciation. This subject will receive full 

 attention in the Marketing Conference 

 this afternoon. 



Soybean Association 



"Approaching the marketing season 

 of 1932, the Soybean Marketing Associa- 

 tion, because of its peculiar ability to 

 negotiate in terms of large volume, suc- 

 ceeded during the month immediately 

 preceding the marketing of beans last 

 fall to raise the Illinois country price 

 of beans from 37-38 cents to 46-47 cents 

 per bushel. This fact will not be dis- 

 puted by anyone in a position to know. 

 Within itself, such a service justified 

 a much larger volume of beans than 

 had been previously marketed by the 

 organization. Its experience, however, 

 was to the contrary, as its volume 

 shows a great decrease from that of the 

 previous year. Every bushel of beans 

 sold by the organization was at the 

 time of its sale disposed of on a premi- 

 um basis above market price. Nearly 

 all of Its beans have now been disposed 

 of. Thirty-five cents (35c) per bushel 

 has been retiuned to each of Its pool- 

 ing members, and final settlement 

 should be made and available In the 

 near future. 



"It Is my belief that the officers, board 

 of directors and Interested members 

 throughout the soybean territory of 

 Illinois should convene without undue 

 delay and make preparation for the 

 complete reorganization and capitaliza- 

 tion of this organization on a sound 

 business basis. I am sure the service it 

 has rendered, the influence upon price 

 which It has had, and Its reputation for 

 sound business practice provides a basis 

 upon which will yet be bullded one of 

 the strongest and most serviceable co- 

 operative marketing institutions yet 

 developed in the State of Illinois. 



Illinois Grain Corp. 



"The Illinois Grain Corporation has 

 enjoyed a good year notwithstanding 

 the insidious propaganda continuously 

 put forth by opponents of co-operative 

 marketing to confuse and misguide the 

 grain producers of the state. This cor- 

 poration is now the second largest 

 regional of the Farmers' National Grain 

 Corporation. Its membership now num- 

 bering 111 farmers' co-operative ele- 

 vators and grain associations, handled 

 9,140 cars of grain during 1932 or ap- 

 proximately 14,500,000 bushels. This 

 shows an increase of 30 per cent in 

 grain handled over that of the previous 

 year. 



"The corporation paid its cumulative 

 dividends for 1931 and 1932 during the 

 year, and placed in Its surplus account 

 $29,909.00. In addition, It received from 

 Farmers' National Grain Corporation a 

 stock dividend carrying a par value of 

 $52,815. In my judgment, the corpora- 

 tion is justified in declaring and dis- 

 tributing a substantial patronage divi- 

 dend at this time. 



"Although only in its infancy, such 

 a record certainly entitles the Illinois 

 Grain Corporation to much greater and 

 widespread support by the grain pro- 

 ducers of this state in efforts to secure 

 control of their own marketing ma- 

 chinery. 



Serum Association 



"The Farm Bureau Serum Associa- 

 tion handled a total of 41,011,000 cc of 

 serum and virus during the year. This 

 volimie had a contract value of $185,176. 

 While It Is difficult to appraise the sav- 

 ings made possible by this co-operative 

 enterprise, a survey of prices prevailing 

 in adjoining states indicates a saving 

 equivalent to 15 cents per 100 cc on both 

 senun and virus, or a total of ^1,517. 



Holding Company 



"The Illinois Agricultural Holding 

 Company was organized in the spring 

 of 1929 for the purpose of acquiring the 

 stock of Country Life Insurance Com- 

 pany. The first Preferred stock is held 

 by the Farm Bureaus and Farm Bu- 

 reau members throughout Illinois; the 

 Second Preferred Stock and Common 

 Stock is held by the Illinois Agricul- 

 tural Association. All of this stock is 

 limited to 7 per cent cumulative divi- 

 dends. At the time of its organization, 

 it was recognized and understood by 

 the Farm Bureau leaders of Illinois 

 that all dividends reaching the Holding 

 Company as a result of its ownership 

 of the stock of Country Life Insurance 

 (Continued on page 12> 



