PRESENTATION

BY

DAVID KOLSRUD

EXPERIENCED DEVELOPER/CONSULTANT/FARMER

NATIONAL ECONOMIC

GARDENING & RURAL

ENTREPRENEURIAL

GATHERING

PRIMING THE PUMP

IN RURAL AMERICA

The Kolsrud Farm

BUSINESS INVOLVEMENT Manager CORN-er Stone Farmers Co-op

Board Member Badger State Ethanol

Board Member Husker Ag Ethanol

Board Member MinWind

Chairman Valley Springs Farmers Co-op

Founding Board Member MNSP

Coordinated Mid Missouri Ethanol Co-op

Partnering with Mid Atlantic Bio-Diesel

Consulting with numerous other projects

Don’t put all your eggs in one basket

Need to Specialize

Bigger is Better

Better Marketing

Low Cost Producer

Embracing New Technology

RAT RACE

Creative Thinking

Need to be Active Politically

ETHANOL PLANTS

IN

MINNESOTA

Minnesota Model

2 Key Components

1. Markets

Oxygenated Fuel Statute

2. Producer Incentive

20 cents a gallon up to 15 million gallon a year for 10 years

AGRI-Energy Ethanol

Corn Production

Rock County Minnesota

Average Production (95-99) 16,540,760

Feed Usage (5,510,000)

11,030,760

1 Bushel Corn Equals

2.6 Gal. Ethanol 17# DDGS

x $1.20 x3.5¢/lb.

$3.12 59.5¢

$3.12

0.60

$3.72

EXPORT vs EXPORT + PROCESSING

11,030,760 5,030,760 6,000,000

x $1.60 x $1.60 x $3.72

$17,649,216 $8,049,216 $22,320,000

$30,369,216

(17,649,216)

$12,720,000 Additional Cash

$12,720,000 Additional Cash

x 13 Plants

$165,360,000 Additional Cash

(most of which is spent in Minnesota)

HIGHER

CORN PRICES

LOWER

CORN PRICES

HIGHER

GAS PRICES

LOWER

GAS PRICES

ETHANOL BUSINESS CHANGES

COOPERATIVES

LLC’S

PRIVATE PLACEMENT

IPO’S

Minus equals&

EQUITY RAISED %

FINANCING

TAX ISSUES

DISTRIBUTIONS

GOOD

OR

BAD

VS

WHAT ARE THE CHARACTERISTICS

OF A

SUCCESSFUL

PROJECT?

GOALS•1. Local Ownership

•2. Maximize Profitability

•3. Create Economic Development in Rural Areas

•4. Provide Quality Jobs

•5. Research & Utilize available programs & incentives

•6. Be politically active to achieve our goals

•7. Develop a “cookie cutter” model

•8. Maintain Cooperative Principles

Don’t let the

grants/incentives

become the project

“CONCEPTION TO COMPLETION”

SUMMARYMYTH --- Farmers Don’t Have The Money

30 Farmers at $6,500 (cash) each could own a

1.8 Million Dollar Project

HOW?

1. Get Good Advice—Consultants

2. Cooperate

3. Utilize or Create Programs to your benefit

4. Network with other groups

5. Believe in Yourself (nobody’s going to do it for you)

David KolsrudFOR FARMERS,LLC

E-mail:

David@for-farmers.com

Cell Phone:

(507) 920-5348

Website: www.for-farmers.com

(under construction now)