Farmstart - Louis and Margaret Rainville

Louis and Margaret (Maggie) Rainville are a recent FarmStart investment.  They are renting 180 acres of crop land in St. Albans, VT and are growing grain, corn and soybeans to supply organic markets.  Their crops are sold to regional organic grain dealers.  Louis has been working on his father’s organic dairy farm his entire life.  In 2012 he and Maggie started raising their own crops.  Yields were very good and with last year’s prices they were able to purchase a Sukup grain drier and two storage bins.

They came to Yankee with a good business plan, lots of drive and potential, but not a lot of equity or capital, a good fit for a FarmStart investment!  Louis and Maggie work closely with Loan Officer Chuck Custeau (their FarmStart advisor) and Financial Services Assistant Alicia Marcy, taking advantage of the discounts offered to FarmStart investments.

Pictured are Louis, Maggie and their two children, Isidore and Kaitlin standing in front of their grain drier.

Why can't everyone digest milk?

The dairy industry is significant in Yankee territory, and a natural question is: Why can't everyone digest milk? The science journal Nature recently published a fascinating article on this subject. The article says that almost all young children can digest milk, but worldwide only about 35% of adults can. Why?

I recommend reading the whole article (link below), but here are some highlights:

• The lactase gene is needed to digest the lactose in milk.
• Babies are born with the lactase gene, but it switches off in most people around age 7 or 8.
• In prehistorical times, it switched off in everyone.
• About 7,500 years ago, a genetic mutation appeared in certain populations that allowed the lactase gene to function even in adults.

The article also explains that even in lactose intolerant populations, and more than 7,500 years ago, humans fermented milk into cheese and yogurt as a way of reducing lactose to tolerable levels. Why? Because the nutritional advantages of dairy products were so great. Those nutritional advantages likely influenced how civilizations developed, and perhaps even which civilizations survived.

Here is the article: The Milk Revolution

Some of the conclusions in the article are controversial. I recommend reading the comments, too. I like this comment: "I think we're only beginning to understand what's going on here."

UPDATE 4/01/15: This article in the Economist is about a similar theme:
No use crying: The ability to digest milk may explain how Europe got rich

Kaitlin Benoit - Farm Credit Fellow

Last week Kaitlin Benoit visited the Newport office as part of the Farm Credit Fellows Program. Kaitlin is going into her senior year this fall at the University of Vermont as part of the 2+2 Program. While visiting the Newport office she visited farms for tours, loan closings, and construction inspections. She also learned about the application and analysis process. After graduation this December Kaitlin plans to return to her family's 850 cow farm in Richford, VT. She hopes to help with the cattle breeding program, parlor management, and the calf program. She also plans to continue the farmstand she started last year.

2nd Quarter Financial Results

Quarterly net income for Yankee was $2.2 million, a decrease of $294 thousand from 2012. Net interest income increased 15 percent to $3.5 million, up from $3.0 million in 2012. The increase in net interest income was offset by a decrease in other income of $403 thousand as compared to 2012. The decrease in other income resulted primarily from $393 thousand in refunds received in 2012 from the Farm Credit System Insurance Corporation (FCSIC) related to the Farm Credit Insurance Fund (Fund).

For the first six months of 2013, net income decreased 2 percent to $4.4 million, down from $4.5 million a year ago. Net interest income increased 13 percent to $6.8 million. There was a provision for credit losses of $161 thousand through the second quarter of 2013, as compared to a reversal of $112 thousand to the provision for credit losses during the same period in 2012. Other income decreased by $401 thousand, primarily due to the FCSIC refund of $393 thousand in 2012.

Loans held by the Association at June 30, 2013 were $383.9 million, down 0.3 percent from year end. The loan portfolio continues to be concentrated in the dairy industry, with 54.1 percent of the loans invested in dairy businesses. The second largest concentration is timber, with 11.9 percent of the loan volume at quarter end.

Click here for the full quarterly report to shareholders.