permaculture

[Lawrence London <lfljvenaura@gmail.com>]

Farmer Cooperatives - www.entrepreneurstoolkit.org
http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives

Farmer Cooperatives

This article outlines the specific benefits and workings of Farmer
Cooperatives (also known as Agricultural Cooperatives).

   - 2012 has been declared as the International Year of Cooperatives (IYC)
   by IFAD, in partnership with the UN Food and Agricultural Organisation and
   the World Food Programme[1]
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-IFAD-0>.


Definition and Concept

Farmer cooperatives are formal methods of organisation for groups of
farmers within communities, hamlets, or regions. They are operated by local
group members who generally ‘share’ resources and earnings, and work
towards mutual benefits for all members. As such, farmers cooperatives
unify the farms of small-scale producers while each farmer continues to own
her/his land and farm it individually[2]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-1>.


Farmer cooperatives work to promote sustained livelihoods, rural
employment, sustainable resource mobilisation and use, empowerment and
social reform[3]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-GEAC-2>.


As all cooperatives in general, Farmers Cooperatives are voluntary
member-based organisations that exist in every sector of the economy. The
primary objective of all types of Cooperatives is to meet the economic and
social needs of their members. This sets them apart from investor-owned
businesses, which have the primary purpose of maximizing profits for
shareholders. (See more on cooperatives in general here, including the
seven international principles of all co-operatives
<http://www.entrepreneurstoolkit.org/index.php?title=Cooperatives>).
Why form a farmer cooperative?

For small-scale farmers, ensuring household food security or income can be
difficult given the constraints of farm size and access to technical modes
of production - farm sizes of less than two hectares form 85% of all farms
in the world[4]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-3>.
Therefore, the establishment of a cooperative is a step towards creating a
viable local enterprise that may have more bargaining and purchasing power
for its members which work towards poverty reduction objectives. As a
group, cooperative members may be able to pay less for agricultural inputs
and take over the processing of products to shorten the chain between the
producer and the consumer.

Cooperatives offer a way of reducing individual exposure to risk (from
markets and climate, for instance) by using pooled resources and by
increasing the possibility of securing insurance (e.g. indexed crop
insurance) as a group – often a very difficult task for individual farmers
who are credit-constrained. Cooperatives are important in the development
of contract-agriculture and are increasingly being built into the business
models for Corporate Social Responsibility
<http://www.entrepreneurstoolkit.org/index.php?title=Corporate_Social_Responsibility>
projects[1]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-IFAD-0>.


Furthermore, collective organisation around one issue at the community
level can lead to increased participation in other areas of social
development, such as access to land and land rights claims.

Additionally, the education component inherent in farmer cooperative
development can result in the adoption of more sustainable farming methods,
including intercropping and crop rotation[1]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-IFAD-0>.

Types of farmer cooperatives

Agricultural cooperatives in rural areas are typically categorised
according to the following activities, sometimes operating within all three
areas:

   - a) Production – farms are organised as corporations (the most common
   form)
   - b) Supply – purchase products, services and inputs for their members
   - c) Service – a variety of services related to education, advice and
   training

In many developing countries, cooperatives are primarily village-based.
Cooperatives begin at the local (community) level and as they grow, they
can partner with neighbouring cooperatives to expand at the district and
regional levels and advocate further up the chain, increasing political
reach and clout[3]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-GEAC-2>.

Women and Cooperatives

In developing countries, women are responsible for roughly 60% of
agricultural production. Nevertheless, women are still more constrained in
terms of market and productive-asset access and land ownership[5]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-pinto-4>.
Farmers cooperatives may offer opportunities to groups who might not
otherwise be included in a local decision-making process, such as women or
youth. In general terms, “gender equality means equality at all levels of
education and in all areas of work, equal control over resources, and equal
representation in public and political life”[6]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-radio-5>.
In contexts where women do not own land, do not manage the farm or are not
‘responsible’ for the main cash crop, cooperatives encourage on-farm
diversification activities to be undertaken by the woman that may then act
as a supplement to household income when sold at market or used to produce
other types of goods[6]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-radio-5>.
Conversely, cooperatives provide female-headed households with equal access
to productive resources, marketing opportunities and savings and credit
services([7]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-6>
;[8]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-ILO-7>).

A role for mobile technology and ICT development for farmer cooperatives

Improving the quality and reach of ICTs (defined as the set of activities
that facilitates the capturing, storage, processing, transmission and
display of information by electronic means[9]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-Cecc-8>)
for development as it relates to market price information, weather updates
and micro-finance has huge potential in balancing the asymmetrical terms of
trade and access to information constraints faced by many small-scale
producers. This can stimulate entrepreneurship through improved connections
to current market conditions [9]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-Cecc-8>.


Mobile financing platforms such as the M-Pesa in Kenya or Smart Cards in
Andhra Pradesh, India, extend banking services to clients via mobile
transfers and accounts; this concept is being scaled-up to include
small-scale insurance packages which can be extended to groups of farmers
[10]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-9>.

Risks faced by Farmer Cooperatives

   - Increasing market linkages

Increasing market linkages refers to intervening to develop markets for new
agricultural products. The promotion of increased market linkages is a
somewhat controversial topic in development circles primarily because of
price volatility in the markets; this is particularly relevant for
small-scale farmers who are not yet able to diversify their crops or
sources of income and therefore can be more negatively affected by a price
drop (i.e. they may not be able to recoup their investments and/or become
indebted to a creditor). Since access to credit and inputs is essential for
cooperatives, they can also become beholden to multiple micro-lenders and
if there is a poor harvest or market failure, may be unable – even as a
group – to repay money owed (See: Micro-finance page for further
information)[8]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-ILO-7>).


   - Political and/or Elite Capture

In countries in Latin America and Central Asia, government has had a level
of control over local cooperatives, utilising them as political platforms
and reducing their function to an extension of the state[5]
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_note-pinto-4>.
Elite capture refers to individuals or groups who have more power in the
decision-making process and whose interests are given priority within a
community at the expense of less influential groups.
See More

   - Farmer Cooperatives 'How-To' Guide
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives_%27How-To%27_Guide>
   - Cooperatives
   <http://www.entrepreneurstoolkit.org/index.php?title=Cooperatives>
   - Community Economic Development
   
<http://www.entrepreneurstoolkit.org/index.php?title=Community_Economic_Development>

References

   1. ↑ 1.0
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-IFAD_0-0>
   1.1
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-IFAD_0-1>
   1.2
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-IFAD_0-2>
   IFAD, (2011), “Agricultural Cooperatives are key to reduce hunger and
   poverty”, IFAD Rome, Accessed at:
   http://www.ifad.org/media/press/2011/76.htm
   2. ↑
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-1>
   MIT, (2012), ‘Small Farm Cooperatives’, Mission 2014: Feeding the World,
   Accessed at
   http://12.000.scripts.mit.edu/mission2014/solutions/small-farm-cooperatives
   3. ↑ 3.0
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-GEAC_2-0>
   3.1
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-GEAC_2-1>
   GEAC, (2009), ‘Guidelines for Establishing Agricultural Cooperatives’,
   Accessed at www.doa.agric.za/
   4. ↑
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-3>
   Von Braun, J. (2008). Poverty, Climate Change, Rising Food Prices and the
   Small Farmers. International Fund for Agricultural Development. Rome: 
IFPRI.
   5. ↑ 5.0
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-pinto_4-0>
   5.1
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-pinto_4-1>
   Pinto, A. Costa, (2009), ‘Agricultural Cooperatives and Farmers
   Organisations: Role in Rural Development and Poverty Reduction’, Swedish
   Cooperative Centre, Agricord Available:
   http://www.un.org/esa/socdev/egms/docs/2009/cooperatives/Pinto.pdf
   6. ↑ 6.0
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-radio_5-0>
   6.1
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-radio_5-1>
   Farm Radio, (2011), ‘ Gender mainstreaming in farmers’ cop-operative:
   Groups in Ghana achieve food security for small-scale farmers’, Radio
   Scripts, Package 94, Script 10, December 2011, Accessed at
   http://www.farmradio.org/english/radio-scripts/94-10script_en.asp
   7. ↑
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-6>
   FAO, (2010), ‘Closing the Gender Gap’, SOFA 2010/2011 Report, Accessed at
   http://www.fao.org/sofa/gender/en/
   8. ↑ 8.0
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-ILO_7-0>
   8.1
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-ILO_7-1>
   ILO, (2010), ‘Promising Practices: How cooperatives work for working women
   in Africa’, COOP Africa, International Labour Organisation
   9. ↑ 9.0
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-Cecc_8-0>
   9.1
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-Cecc_8-1>
   Cecchini, S., and Scott, C., (2003), ‘Can information and communications
   technology applications contribute to poverty reduction? Lessons from rural
   India’, Information Technology for Development, Vol. 10, pp. 73-84
   10. ↑
   
<http://www.entrepreneurstoolkit.org/index.php?title=Farmer_Cooperatives#cite_ref-9>
   Havemann T. ,(2011), ‘Financing mitigation in smallholder agricultural
   systems Issues and Opportunities’, CCAFS Working Paper no. 6. CGIAR
   Research Program on Climate Change, Agriculture and Food Security (CCAFS).
   Copenhagen, Denmark. Available online at: http://www.ccafs.cgiar.org

External links

   - Canadian Cooperative Association
   
<http://www.coopscanada.coop/en/orphan/The-Agricultural-Co-operative-Development-Initiative--Ag-CDI->
   - IFAD <http://www.ifad.org/media/press/2011/76.htm>
   - Agricultural Cooperatives Wikipedia Page
   <http://en.wikipedia.org/wiki/Agricultural_cooperative>
   - FAO - Closing the Gender Gap in Agriculture
   <http://www.fao.org/sofa/gender/en/>
   - CGIAR <http://www.cgiar.org/index.html> (search 'cooperatives')

Categories
<http://www.entrepreneurstoolkit.org/index.php?title=Special:Categories>:

   - Agriculture
   <http://www.entrepreneurstoolkit.org/index.php?title=Category:Agriculture>
   - Community development
   
<http://www.entrepreneurstoolkit.org/index.php?title=Category:Community_development>