Cedar Falls, Iowa
October 1, 2003

Ag Services of America, Inc. (NYSE:ASV) announced today that net revenues for the second fiscal quarter ended August 31, 2003 decreased to $36.6 million compared to $80.1 million one year ago. As previously discussed, the decline in revenues was directly attributable to the Company's reduced credit facility for the current fiscal year. Net earnings for the second quarter resulted in a loss of $2.1 million compared to net income of $2.5 million one year ago. During the second quarter the Company incurred a one-time charge of $3.8 million related to expenses associated with the terminated American Securities Capital Partners, L.P. (ASCP) transaction. Also impacting the second quarter was an increase in financing costs compared to the same period one year ago. Excluding the one-time charge, the Company earned approximately $0.5 million of pre-tax income for the second fiscal quarter.

Net revenues for the six months ended August 31, 2003, were $84.8 million as compared to $155.4 million for the same period one year ago. The Company's net loss for the first six months of Fiscal 2004 was $2.4 million, or a loss of $0.43 per diluted share, compared to net income of $4.7 million, or $0.85 per diluted share, for the same period last year.

Net revenues for the first two fiscal quarters decreased as a result of the smaller credit facility available to the Company for 2003 customer loan commitments. The 2003 credit facility limited the Company to approximately $260 million in customer loan commitments, compared to approximately $465 million in customer loan commitments last year. The net loss for the first six months of $2.4 million was caused largely by the reduction in net revenues and the one-time charge for expenses associated with the terminated ASCP transaction. In addition, higher costs were incurred in securing the 2003 credit facility and the additional provision of $1.5 million made to the Company's allowance for doubtful notes during the first quarter, all contributed to the net loss through August 31, 2003. For the first six months ended August 31, 2003, the Company incurred higher than historical financing expenses with cost of funds exceeding Prime plus 200 basis points. Last year the Company's financing costs for the same period averaged Prime minus 25 basis points. The increase in costs were attributable to the interim nature of the current credit facility and delays encountered with respect to the now-terminated ASCP transaction.

During the second fiscal quarter the Company started realizing the benefit of several cost cutting measures taken earlier in the year, with operating expenses decreasing from $3.2 million for the first quarter to $2.6 million for the second quarter.

As stated on September 4th, Ag Services terminated its Securities Purchase Agreement with ASP/ASA, LLC, an affiliate of ASCP. Ag Services is now considering various courses of action, one of which is to seek a credit facility that will allow operations to continue at current levels. Ag Services' current credit facility expires in October of 2004 and restricts the Company from making any credit commitments to its customers for the 2004 crop year. At this time there can be no assurances that Ag Services will be able to secure a new credit facility. In the event Ag Services is unable to secure a new credit facility; the Company's best option may be to liquidate. In June 2003, Ag Services estimated that the discounted net present value per share of its common stock in a liquidation was between $7.18 and $9.68 per share.

Ag Services of America, Inc. is based in Cedar Falls, Iowa, and is a leading supplier of crop input financing and agricultural inputs, including seed, chemicals and fertilizers to primarily corn and soybean growers in the U.S. The Company's one-stop shopping business model includes competitive and flexible financing packages through its AgriFlex Credit® program combined with a comprehensive offering of agricultural inputs from national sources such as Asgrow, BASF, Dekalb, Dow AgroSciences, DuPont, Garst, Monsanto, Syngenta and Pioneer Hi-Bred. The Company also administers additional financing programs for various suppliers, manufacturers and distributors in the agricultural industry and provides ancillary services such as crop insurance and grain marketing.