Ag Services Terminates Purchase Agreement.

Business Editors

CEDAR FALLS, Iowa--(BUSINESS WIRE)--Sept. 4, 2003

Ag Services of America, Inc. (the "Company") (NYSE:ASV) today announced that it has terminated its Securities Purchase Agreement with ASP/ASA, LLC, an affiliate of American Securities Capital Partners, L.P. (ASCP). Ag Services had entered into the agreement in February 2003, which provided that ASCP would invest up to $70 million in Ag Services in three tranches.

One condition to the closing of the Securities Purchase Agreement was that Ag Services obtain debt financing on terms satisfactory to ASCP. Ag Services was unable to secure a credit facility in an amount and with terms consistent with ASCP's initial expectations in order to complete the transactions contemplated under the Securities Purchase Agreement. As a result, Ag Services terminated the Securities Purchase Agreement with ASCP in accordance with its terms, so other options could be pursued.

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 recent levels. Ag Services' current credit facility expires in October of 2004 and restricts Ag Services from making any credit commitments to its customers for the 2004 crop year. 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; it may be forced 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.

The Company is planning to schedule a conference call with its investors after it has been able to clarify its alternatives.

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(R) 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.

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. This release contains forward-looking statements based on current expectations that involve a number of risks and uncertainties. The factors that could cause actual results to differ materially, include the following: general economic conditions within the agricultural industry; changes in agricultural regulations; unknown risks; the ability to obtain a new credit facility or other financing on satisfactory terms; portfolio performance; changes to assumptions other circumstances that may affect the Company's liquidation analysis or ultimate liquidation value; and the risks described from time to time in the Company's SEC reports.

AgriFlex Credit is a registered trademark of Ag Services of America, Inc. All other trademarks or product names are the property of their respective owners. For more information visit www.agservices.com.