A PUBLICATION OF Ag Processing Inc a cooperativeIssue #1, 2020

SHARED VALUES... SHARED SUCCESS

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AGP proudly uses soy ink in all publications!

IN THIS ISSUE

A MESSAGE FROM THE CEO

AGP’s new year began with a successful and well-attended Annual Meeting, the details of which are included in this issue of AGP News. The Annual Meeting provided an opportunity for AGP to present important reports and updates regarding fiscal year 2019, as well as our plans and strategies for the new year. In addition, the Annual Meeting affords the AGP team and our member-owners an opportunity to spend time together, renewing old friendships and making new ones. We appreciate the success of fiscal 2019, especially since it was achieved with record member business.

We are very encouraged to report in this edition that Congress passed, and the President signed, a bill reinstating the important biodiesel blenders tax credit that had been expired for nearly two years. The impact of the credit on AGP and the biodiesel industry is very positive and comes at a time of uncertainty for the industry. Passage of the tax credit was accomplished with your help, and we appreciate the many calls and emails our members sent on behalf of the industry’s advocacy efforts.

Lastly, we were saddened to learn of the passing of Chuck Caldwell, retired Commissioner for the Port of Grays Harbor (the Port). Chuck was a tireless advocate for expanding business opportunities at the Port and was a key champion for many years of AGP’s investments there. On behalf of AGP, we express our deep sympathies for the loss of our friend, business partner, and community leader.

Sincerely yours,

J. Keith Spackler Chief Executive Officer

3 AGPAnnual Meeting

6 Annual MeetingHighlights

8 Biodiesel Update

9 Project Update/In Memoriam

10 StakeholderEngagement

11 Member News

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Meet Your Directors Elected at the 2019 Annual Meeting

SHARED VALUES... SHARED SUCCESS

AGP held its 36th Annual Meeting on January 16 and 17 in Omaha, NE. Member participation was outstanding with approximately 1,000 people in attendance.

The Annual Meeting theme of “Shared Values, Shared Success” highlights AGP’s dedication to business values that include integrity, communication, and teamwork. AGP shares these values with its member-owners, employees, and other stakeholders in pursuit of business success.

During the annual meeting, member-owners elected three directors to serve on the AGP Board for three-year terms. Re-elected to new terms were Chuck Schafer, General Manager of North Iowa Cooperative in Thornton, IA and Jay Sunderman, Producer from New Market, IA. Dean Thernes, President/CEO of Farmers Pride Cooperative in Battle Creek, NE is a newly-elected Director to the Board. Thernes replaces former Director Randy Robeson, who recently retired.

CHUCK SCHAFER - AREA 1 MANAGERChuck has served as General Manager of North Iowa Cooperative in Thornton, IA for 30 years. His cooperative career also includes 12 years of service at Farmers Cooperative in Manly, IA, including nine years as Assistant Manager. Chuck graduated from NIACC in Mason City, IA with an Ag Business degree and attended Winona State University in Winona, MN. He has served on the AGP Board of Directors for 10 years.

Chuck is a Director on the Risk Committee of Golden Grain Energy in Mason City. His previous cooperative service includes the Ag Leadership Council for Land O’Lakes as well as a District Director for the cooperative. He also served on the Board of Directors for the Iowa Institute of Cooperatives for six years and is a past Director for Cooperative Mutual Insurance.

(Continued on page 4)

DEAN THERNES - AREA 3 MANAGERDean has served as President/CEO of Farmers Pride Cooperative in Battle Creek, NE for 12 years. His 36-year cooperative career also includes Special Projects/Southern Region Manager for Farmers Cooperative in Dorchester, NE, Interim Manager, Grain Manager, and Location Manager for Farmers Cooperative Elevator in Plymouth, NE, and Location Manager and Agronomy Manager at Southeast Nebraska Cooperative in Beatrice, NE.

Dean is Vice Chairman of the Nebraska Cooperative Council, President of the Nebraska Cooperative Managers Association, and served as a Director of NIK from 2010-2018. Dean graduated from the University of Nebraska-Lincoln with a degree in Agriculture.

JAY SUNDERMAN - AREA 1 PRODUCERJay operates a family farm near New Market, IA, growing corn and soybeans on 5,000 acres. The operation also includes an 800-head beef feedlot and a 200-head cow/calf herd. Jay has 24 years of cooperative Board experience. He currently serves as a Director for Agriland FS, Inc. in Winterset, IA. Jay previously served on the Board of Directors for Clarinda Cooperative Co. in Clarinda, IA, including the President and Vice President positions. He has served on the AGP Board of Directors for six years.

Jay attended Iowa Western Community College, Clarinda campus, while beginning his full-time farming operation. He is a member of the Iowa Soybean Association, Iowa Corn Growers Association, Iowa Farm Bureau, Taylor County Cattlemen, and Iowa Cattlemen’s Association.

AGP ANNUAL MEETING

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AGP ANNUAL MEETING

Various speakers updated the member-owners on fiscal 2019 successes and provided insights into future AGP business and industry opportunities. “Not only did AGP achieve strong fiscal 2019 results with record member business, the Company once again did so in a manner that reflects the cooperative values we all believe in and share collectively,” stated Board Chairman Brad Davis in his address to the attendees. “Let us share in this success today, understanding the values that underpin our strategic approach to this business reflect the Midwestern values that have made American agriculture the powerful force that it is.”

Chief Executive Officer Keith Spackler, said AGP’s success is measured by achievements in accordance with the Company’s mission to provide competitive markets, to add value to agricultural products, and to generate a competitive rate of return, all for member-owners and producers. “During

fiscal 2019, our team dedication and commitment resulted in outstanding successes ranging from marketing and operational milestones to record financial achievements to growth initiatives,” said Spackler. “We acknowledge the challenging market and business conditions affecting many of our member-owners and producers, and thus we share our success with you – that is what being a cooperative is about and why it is our mission.”

Scott Simmelink, AGP’s Chief Financial Officer, said the Company’s financial position remains very strong. He emphasized the strength of AGP’s balance sheet which provides the Company the flexibility to capitalize on market opportunities and deal with adverse business conditions.

Senior Vice Presidents Mark Sandeen, Chris Schaffer, and Troy Alberts each highlighted the success of the past year and discussed future opportunities within their respective business units.

Records achieved in fiscal 2019:• Earnings and cash patronage• Soybeans processed• Refined soybean oil production• Volume marketed through export terminal

at the Port of Grays Harbor

“Shared Values...Shared Success”(Continued from page 3)

2019 Annual Report

If you would like to receive a copy of the AGP 2019 Annual Report, please contact kanliker@agp.com or call 800-247-1345 x5017.

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AGP honored four individuals for their past leadership and contributions to AGP during a special recognition session. Randy Robeson retired from the AGP Board of Directors after many years of service to the Company and the cooperative system. Retiring Chief Operating Officer and Group Vice President Cal Meyer was recognized for his 34 years of service and leadership with AGP. Also honored were retiring AGP executives Steve Hansen, Vice President Engineering, and Steve Johnson, Vice President Information Systems.

Looking ahead to fiscal 2020, CEO Keith Spackler said agriculture and agribusiness in general are experiencing more moderate market returns relative to those of a few years ago. “For our first four months of fiscal 2020, our base returns are good though down significantly from last year. But with the benefit of the recently reinstated biodiesel tax credit, anticipated earnings for the full year will again be significantly above average. However, regardless of conditions, we will continue to optimize AGP’s business to the benefit of our owners.”

Following the business meeting, keynote speaker Dr. Kevin Hassett, a leading global economist, gave a thought-provoking presentation providing key insights on the complex dynamics of world events and relationships shaping markets and the economy.

AGP’s 2020 Annual Meeting is scheduled for January 21 and 22, 2021.

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ANNUAL MEETING HIGHLIGHTS

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Late in December, Congressional leaders passed a five-year extension of the federal biodiesel tax incentive. Passage of the extension, included as a component of the FY 2020 government funding package, was the result of many biodiesel producers and stakeholders working together at the grassroots level and in Washington, D.C. to support this vital industry. The $1.00/gallon biodiesel tax incentive, which expired in 2017, was extended retroactively for 2018 and 2019 and will be in place for calendar years 2020, 2021, and 2022. AGP’s Chief Executive Officer Keith Spackler welcomed the extension and said “We want to thank our Congressional supporters for their efforts to move this five-year extension forward at a time of uncertainty for the biofuels industry. AGP has long supported biodiesel and its importance to farmers, AGP, and AGP’s cooperative member-owners cannot be overstated. We look forward to the positive impact the extension of the biodiesel tax incentive will have on soybean prices and U.S. biodiesel production.”

Troy Alberts, Senior Vice President Refined Oils and Renewable Fuels and a member of the National Biodiesel Board’s Governing Committee, spoke about the market dynamics of the biodiesel industry and AGP’s leading presence, as both a biodiesel producer and feedstock provider. “The multi-year extension

will support and provide certainty for AGP’s integrated soybean processing platform and improve demand for soybean oil used in the production of biodiesel. Soybean oil is currently the primary feedstock for the industry.” Alberts also noted the important role the biofuels industry has in supporting farmers, rural American jobs, and providing cleaner-burning fuels for the environment.

AGP Commends Passage of Biodiesel Tax Incentive

Troy Alberts, Senior Vice President Refined Oils and Renewable Fuels, was elected to serve as Treasurer of the National Biodiesel Board (NBB). The NBB is the leading trade association for the U.S. biodiesel industry.

ALBERTS ELECTED TREASURERNBB BOARD

AGP Team Members, including Troy Alberts, Matt Caswell, and Courtney Lawrenson met recently with members of Congress to advocate for the biodiesel tax credit in Washington, D.C. AGP and members of the biodiesel industry met with Representative Abby Finkenauer, the lead sponsor of the biodiesel credit in the House, and Senator Joni Ernst from Iowa.

BIODIESEL UPDATE

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Soybean Meal Loadout ProjectEagle Grove, IA

Chris Schaffer (left), Senior Vice President Ag Products and Cal Meyer, retired Chief Operating Officer, pose with Chuck Caldwell, former Port of Grays Harbor Commissioner who passed away recently. In addition to his leadership at the Port, he was a well-known community leader.

PROJECT UPDATE/IN MEMORIAM

Chuck Caldwell: In Memoriam

Construction of a new truck soybean meal loadout at AGP’s Eagle Grove facility is making great progress and will improve AGP’s loading rate and traffic flow at the site. The project, which consists of two new meal storage silos (pictured) and two new truck lanes, is on schedule for completion by late summer 2020.

The former truck loadout remains operational while construction is underway and will continue to be utilized for loading loose soybean hulls once the new facility is completed.

This project positions Eagle Grove to meet the growing demand for high quality soybean meal from the expanding livestock industry in central Iowa. AGP will continue to invest in all of its existing facilities to ensure the ability to supply our customers’ future needs.

Chuck Caldwell, 87, former Commissioner at the Port of Grays Harbor in Aberdeen, WA, passed away recently.

Caldwell served as a Commissioner from 2002 to 2018, a time that saw the Port move from being a logging industry port to add a wider variety of cargo and the infrastructure to handle it, including AGP’s export terminal.

Upon his retirement in July last year, the Port credited him with contributing to its growth and diversification during his tenure, including increased international trade and commercial fishing activity, adding more than $50 million in Port infrastructure projects.

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STAKEHOLDER ENGAGEMENT

AGP Hosts FAC Leadership

In January, Board members and senior management from Farmers Cooperative Elevator Company (FAC) in Arcadia, IA visited AGP and received updates from AGP management including Mark Sandeen (pictured above), Senior Vice President Soybean Processing and Matt Caswell, Vice President Member/Corporate Relations. Dave Leiting, General Manager at FAC, is a member of AGP’s Board of Directors.

Jerry Schmitz (left), Executive Director, South Dakota Soybean Association visits with Dr. Dave Gast, Director Nutrition and Technical Services in Omaha, NE at the AGP booth at the annual South Dakota Soybean Ag Outlook held in Sioux Falls, SD in December.

South Dakota Soybean Ag Outlook

ISU Ag Business Club Visits AGP

Members of the ISU Ag Business Club at AGP’s corporate headquarters in Omaha, NE.

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• Mitch Altermatt is serving as General Manager at United Farmers Cooperative in Winthrop, MN, effective June 1. He has been with the cooperative the past three years serving as Chief Operating Officer. Mitch’s 12-year cooperative career also includes CEO at Central Lakes Cooperative in Atwater, MN and management and sales positions with CHS and Meadowland Farmers Cooperative in Lamberton, MN. He is a graduate of Southwest Minnesota State University in Marshall, MN.

• Jeff Krejdl has been promoted to General Manager and CEO of Ag Valley Cooperative Association in Edison, NE effective September 3. Jeff previously served as CFO since 1998 when he joined Ag Valley.

• The members of Hazel Farmers Elevator in Hazel, SD approved a merger with Hamlin County Farmers Cooperative in Hayti, SD effective February 1, 2020. Jim Egeberg is the General Manager of Hamlin County Farmers Cooperative.

• The AGP Board of Directors approved the membership of Farmers Cooperative Elevator Company in Lidgerwood, ND. Todd Dravland is the General Manager.

• The AGP Board of Directors approved the membership of Dakota Growers Coop in Plankinton, SD. Jim Page is the General Manager.

• The AGP Board of Directors approved the membership of Farmers Cooperative Elevator Company in Hemingford, NE. Bart Moseman is the General Manager.

• The Board of Directors of Gold-Eagle Cooperative in Goldfield, IA named Chris Boshart as General Manager. Chris has served as the cooperative’s Feed Manager since the summer of 2018. His career also includes serving as CEO at Agri-Way Partners, a farmer-owned feed and grain company based in Wayland, IA, where he grew up on a turkey and row-crop farm. Chris earned a degree from Iowa State University in Industrial Engineering. He succeeds Brad Davis, who retired after serving Gold-Eagle for 35 years.

• Jeff Thaler is the new General Manager at Full Circle Ag in Britton, SD, effective September 1. Jeff has 25 years of experience in cooperatives and agriculture, including the past 20 years with Land O’Lakes, Inc. serving as Key Accounts Director working with local cooperative members across the Midwest. His career also includes agronomy/ag retail management at the cooperative in Beresford, SD. Jeff is a native of Wagner, SD. He succeeds David Andresen, who retired after serving the cooperative for nearly 24 years.

• Farm Country Co-op in Wallace, SD, merged with Watertown Cooperative Elevator Association in Watertown, SD effective January 1, 2020. Lanny Kirsch is the General Manager of Watertown Cooperative Elevator Association. The membership of the coop will vote at their annual meeting in March regarding a potential name change to “Agwrx Cooperative”.

Updates on Cooperative Members

MEMBER NEWS

AGP Grain Marketing, LLC Completes Sale of Texas and New Mexico Operations

AGP Grain Marketing, LLC, a subsidiary of Ag Processing Inc a cooperative (AGP), announced in January that it had completed the sale of its grain and processed corn business unit in Texas and New Mexico to Heartland Co-op (Heartland) in Des Moines, IA.

AGP’s CEO Keith Spackler stated “The Texas and New Mexico locations have been a part of AGP’s grain operations since 2002. We are pleased to see the facilities remain in the cooperative system and are confident that Heartland will continue to provide high-quality feed and value-added service for dairy, livestock, and grain customers in the region.”

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To reach us, contact: Member Relations / P.O. Box 2047 / Omaha, NE 68103-2047Phone: 402-431-5017 / Email: kanliker@agp.com

The Puget Sound & Pacific Railroad provides short-line rail service to AGP’s export terminal at the Port of Grays Harbor in Aberdeen, WA.