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March 17, 2009

Subject: Farm Information by Ric
Good morning everyone,

I had a great visit with my local investment mentor yesterday and thought I'd share some interesting information. There are two streams of source material here so it is not a "double intel" from the same source.

1) Two of the stock newsletters I get are describing a current situation where seed companies are currently having a difficult time selling flower seeds and are beginning to encounter shortages of garden/vegetable seeds as it seems the panicked public is planting food gardens this year in response to economic times. Included with this is an apparent run on canning supplies/jars and cookers. They are expecting shortages in this area as well.

2) My mentor showed me yesterday where farmers are not being able to get traditional PCA operation loans to buy fertilizer and seeds for planting for items such as corn and soybeans - the banks at the top end are not making the loan funds available!

He spent 42 years as a commodities broker/investor and they go by the rule of "6 plantings per season" to get a crop out - they are down on the first planting applications by 72% for this time of the year. In the 4+ decades of his experience, this is the first time he has seen this happen at the scale it is occurring and expects several things out of this:

- serious food shortages in the fall,
- reduction of animals in the feed system as a result of grain shortages (less meat means higher prices also),
- higher food prices from the shortages,
- increased value from higher profit margins for food production companies such as Cargil, Hentz, Kraft, etc.,
- greater competition/demand from the foreign market that our country typically has surpluses to sell to with potential trade lawsuits filed against us through the WTO,
- worldwide food shortages and civil unrest resulting from this lack of planting by our farmers in the Midwest "bread belt".

This should be considered in you stock investment/options strategy for the sectors of commodities, retail, gold and petroleum. This should not be a dominating factor in your decisions, just something to be aware of. Let me know if you would like to know more about what to keep on the back burner of your thoughts on this.

This is something to watch as you consider getting a veggie garden going for you and your family as well. I know I'm refitting my pressure cooker gaskets and getting more Mason jars very soon.

Ric