Halloween is on the horizon, but a less well-known and much less spooky celebration to take note of this October is National Cooperative Month.
This month, the United States celebrates its strong network of cooperatives — the user-owned, user-controlled businesses that serve many sectors of our economy. Cooperatives are unique in that they are formed to meet the needs of their individual members, not the profit expectations of outside investors.
Members who use the services of a cooperative have a say in its operations, and share in the profits it generates. Cooperatives also often operate with a local focus, taking part in community improvement programs, sponsoring local events and contributing to charities.
The most recognizable types of cooperatives in an urban setting are credit unions and grocery co-ops. In a rural area, cooperatives often take a different form, like the local feed mill, electric cooperative, agricultural supply store or a creamery that pools milk from regional farmers for processing.
These institutions are a very important part of the agricultural industry and considering the nature of farming it’s easy to see why: farming is typically highly individualistic, farms are often distant from markets located in more urban areas, and not all farmers have the time, expertise and resources to access reliable markets and negotiate prices for both their products and their inputs. As part of an agricultural cooperative, farmers can be stronger together, pooling resources to increase their purchasing power and pooling their products to access larger markets.
In Wisconsin, cooperatives have played an especially important role in the development of our top agricultural sectors, from dairy to cranberries. In fact, one of the first cooperatives formed in Wisconsin served our early dairy farmers. To help neighboring farms find reliable buyers for their milk, Anne Pickett of Lake Mills created a dairy co-op in 1841. She pooled milk from area farms to make cheese to sell in the Milwaukee area and profits from the sales were divided between neighbors according to the proportion of milk they supplied.
Later, other cooperatives stemmed from the Grange movement, which advocated for farmers’ economic needs and familiarized farmers with cooperative agricultural supply stores, local grain elevators to pool farmers’ grain, and cooperative grain milling operations. Today Wisconsin is one of the national leaders in number of agricultural cooperatives with 113 operating in our state as of 2015, according to the USDA Rural Development Service.
Modern manifestations of the agricultural cooperative model are apparent in the organic, local food and value-added sectors. Small scale and organic producers of fruits, vegetables and meat have formed cooperatives to pool their products, market them to retail and wholesale buyers and reduce the amount of time spent transporting their products to restaurants, grocery stores and other markets in urban areas.
Some farmer–owned cooperatives have capitalized on other segments of the food supply chain that add value to raw ingredients, establishing their own processing facilities to help boost their members’ profitability and sustainability.
No matter the sector they serve, there are many reasons to celebrate cooperatives this month. They certainly have a big impact — according to a recent survey by the USDA Rural Development Service, Wisconsin cooperatives represent more than $5.6 billion in gross sales, they employ 30,000 local employees, and benefit our communities by paying $200 million in state and local taxes.
Leigh Presley is agriculture educator for Racine and Kenosha County UW-Extension.