Farmland senior managers deliver good news for fiscal 1994.

KANSAS CITY, Mo.--(BUSINESS WIRE)--Dec. 1, 1994--Three senior managers of Farmland Industries Inc. delivered good news to approximately 3,000 attendees at the regional cooperative's annual shareholders' business meeting Thursday morning at Bartle Hall.

Robert W. Honse, executive vice

president for Agricultural Input Operations, Gary E. Evans, senior vice president for Ag Production Marketing/Processing, and Tony Lewis, vice president of the Grain Division framed their comments about fsical year 1994's operating results in Farmland's mission statement, "To be a producer-driven and profitable 'ag supply to consumer foods' cooperative system."

Reporting on Farmland's more traditional ag input product lines, Honse said, "Your regional has taken bold steps this past year and it will continue to do so in order to ensure the profitability of its member-owners. That takes leadership. It is that leadership which will take the Farmland Cooperative System into the next century."

Results in the input lines included a record $1.2 billion in fertilizer sales and strong performance in joint ventures which contributed operating profits of $15.7 million to the Crop Production Division. Farmland's Feed Division increased unit sales of formula feed and feed ingredients 10 percent over fiscal 1993 and generated a $48.7 million increase in sales.

The Petroleum Division's performance exceeded expectations with an operating profit of $27.2 million vs. a loss of $4.6 million last year. Unit sales of refined fuels were up six percent over 1993, but total dollar sales reflect a decrease due to lower prices.

Honse pointed to Farmland's regional structure for marketing as a geographic advantage for service to the System's member local cooperatives.

Gary Evans reviewed the results for the "Consumer Foods" part of Farmland's mission. Said Evans, "Your Regional enables you to compete profitably in the global food system. This may be the greatest and most exciting advantage of membership in the Farmland Cooperative System for the future."

Evans reported that output businesses increased sales by $1.6 billion in fiscal year 1994, with an increased operating profit in Food Marketing and Processing of $20.6 million, an increase of $4.1 million over 1993.

Operating profits in the Food Marketing and Processing businesses increased to $20.6 million, with the Carando line of specialty meats setting new records in sales. Said Evans, "Your Cooperative System has specific advantage over other foods companies -- you own the brand." This year, pork producers are receiving $2.97 per head for each hog supplied to Farmland, totaling $10.9 million in patronage refunds to pork producers.

Tony Lewis, who took over the direction of Farmland's Grain Division last August, focused his remarks on the turnaround underway in the division. Although total grain sales were $1.6 billion (an increase of $673.6 million over last year), the division lost $33.5 million in 1994 compared to $0.1 million in fiscal 1993.

Despite past problems, Lewis told the shareholders he "jumped at the chance" to become part of the Division because Farmland's member-owners have "the power the create the first, farmer-owned regional cooperative to have a successful, full-service, and cost effective world-wide grain business" that they control from beginning to end.

"Your regional is in the grain business because it's the major activity of its farmer-owners -- producing food and feed grains as well as adding value to the latter by raising livestock," said Lewis. He then outlined three strategies to achieve the integrated system: thinking beyond the local elevator to customer needs in global markets, strengthening the relationships inherent within the System between farmers, their local cooperatives, and Farmland, and using the physical assets of the System to greater advantage.

Lewis called for the cooperative system to become the "PREFERRED SUPPLIER OF HIGH-QUALITY GRAINS."

Farmland's annual meeting concludes today following election of directors and consideration of a by-law change.

Farmland Industries Inc., headquartered in Kansas City, is one of the nation's largest agricultural cooperatives, owned by about 1,500 farmer-cooperative associations, which in turn are owned by about a half million farmers and producers across the heartland of the United States. In addition, Farmland is owned directly by more than 8,000 livestock producers.

CONTACT: Farmland Industries Inc., Kansas City

Sally Gallion, 816/459-6230