PAGE FROM THE PAST
From the archives of Rural Cooperatives
and its predecessor magazines
50 Years Ago...
From the March & April 1957 issues of News for Farmer Cooperatives
New answer for an old co-op problem: the credit union
Many cooperative leaders today believe that accounts
receivable and mounting pressure for credit pose one of the
most serious problems for farm supply cooperatives. Co-ops
wrestling with this issue should look at a unique plan being
used by Dunn County, Wis., farmers.
In November 1945, Arthur Gilberts, a fuel oil deliveryman
for the Menomonie Farmers
Union Cooperative, began
suggesting that patrons use the
Menomonie Farmers Credit
Union to finance fuel oil
purchases. This, he said, would
permit the cooperative to use its
limited operating capital for
maintaining much-needed
inventory and help farmers keep
their own credit sound.
Gilberts pointed out to the
farmers that it was as logical for
them to drive down to their bank
and ask for a tank of gas, as to go
to their cooperative and expect
credit. He explained that these
different types of organizations
render different types of service.
This made sense to the farmers,
and more of them joined the
credit union and borrowed to
finance purchases — not only fuel
oil, but also other supplies.
By 1949, the credit union was an important factor helping
the cooperative keep accounts receivable under control. The
directors invited Gilberts to become fulltime treasurermanager.
In November 1949, he started to build the credit
union program. Fifty-eight new members, $13,753 in new
share capital and $1,218 in loan volume were added during
the next 60 days.
Today, this credit union has 2,500 members, $860,000 in
share capital and $770,000 in loans outstanding to more than
1,100 area farm families. Since organization, it has loaned
more than $2.75 million with a loss of less than 0.3 percent.
The credit union made 1,182 loans in 1956, totaling
$600,000. Loans averaged $512 and ranged from $60 for a 4-H project to a $10,000 loan for a dairy farm.
For the farmer, this credit union promotes thrift,
encourages savings and provides a sound local investment
place. For the cooperative, this credit union makes it easier for
the association to keep accounts receivable under control,
reduce loss from bad debts and use funds more fully for
operations. The Menomonie Farmers Credit Union is putting
local capital to work in Dunn County for the mutual benefit
of farmers and their co-op.
What kind of co-op package do farmers want?
The Indiana Farm Bureau Cooperative Association was set
up 30 years ago to serve, through its county co-ops, an
Indiana farmer who typically tilled 80 to 100 acres and had a
livestock operation of 5 dairy cows, 10 brood sows and a flock
of 100 laying hens. Today, typical farm size is 200 to 250
acres, and Indiana farms are highly specialized and
mechanized.
These changes have vitally affected Midwestern
cooperatives’ promotional activities. The increased farm size
means that the individual farmer approaches other business
institutions’ status in his buying. This also has affected co-op
price policies.
The trend toward specialization has meant that, instead of
being a jack-of-all trades, the individual farmer becomes a
well-versed and highly trained specialist in narrower fields,
such as broiler production or dairying. He must be talked to
in advertising and personal sales contact as the kind of wellinformed
specialist which he is. Today’s farmer will be quick
to resent and resist quackery or unscientific products or
services claims.
Because of specialization and increased farm size, large
numbers of farmers are not in the market for a ton of
fertilizer, a truckload of feed or a specialized marketing
service. They will likely already have signed a contract which
covers both the purchase of needed supplies and the
marketing of finished products.
Almost all U.S. canning crops are now produced under
such a contract. These contracts cover 90 percent of all
broiler production. Experts see egg production and turkeys
going in the same direction. How long it will be before other
types of farming adopt such a program is hard to guess.
Cooperatives are the natural medium for this kind of
integrated service, if they are willing to develop the integrated
package which includes both supply and marketing.
30 Years Ago...
From the March & April 1977 issues of Farmer Cooperatives
Lehigh, Eskimo Pie Join Forces
Lehigh Valley Cooperative Farmers, Allentown, Pa., and
Eskimo Pie Corporation have finalized an agreement putting
the dairy cooperative into large-volume production of ice
cream specialties and novelty products. The deal could result
in up to $10 million in sales
annually, according to
Lehigh president Robert P.
Barry. Under the terms of
the agreement, Lehigh’s
Allentown plant will become
a production center for the
popular frozen items for
distribution under the
Eskimo Pie label.
Lehigh recently launched a $1 million plant- and
equipment-improvement program aimed at maintaining the
momentum of its recently achieved profitability, according to
Barry. Barry said the investment is being made to achieve
operating cost efficiencies and increase productivity in an
effort to sustain the turnaround of the dairy, which only 2
years ago was apparently on the brink of financial ruin.
Three states recognized for Co-op Month activities
Wisconsin received the State Activities Award for the best
Cooperative Month observance and Colorado and Virginia
earned Awards of Merit from the National Planning
Committee for Cooperative Month. For the third consecutive
year, Wisconsin received top honors for its “comprehensive
and innovative activities” during Co-op Month.
New ideas initiated in
Wisconsin during the 1976
observation included
sponsoring three
conferences titled: “Food —How Will It Be Shared?”
These involved teachers,
clergy, students and
cooperative leaders; a special
award for county
cooperative associations conducting activities during October;
and the presentation of “Cooperative Builder Awards” to
outstanding members, employees and friends of cooperatives.
Wisconsin also distributed hundreds of co-op publications
to libraries and educators. A special “Governor’s Day on the
Farm” brought 200 urban and rural dwellers together, and
more than 400 cooperatives in the state sponsored newspaper
ads. Special meetings and rallies were held, and more than
8,000 bumper stickers proclaiming: “Cooperative People Are
More Fun” were distributed.
Colorado won its award for a slide presentation made after
a survey revealed the economic impact of cooperatives
operating in the state. Virginia’s award recognized its
production and distribution of a series of TV and radio tapes
that included interviews with two young people, a young farm
couple, a woman, and a cooperative member.
10 Years Ago...
From the March & April 1997 issues of Rural Cooperatives
Dakota Soybean Processing Plant Opens
Nearly 2,100 soybean producers have combined resources
to create South Dakota’s first producer-owned soybean
processing plant. The $32.5 million facility, near Volga, allows
area producers to process their own soybeans, ending their
reliance on outside suppliers.
Four years ago, the group
decided eastern South Dakota
producers needed a local plant as
an economical alternative to
shipping them out of the state to
be processed into meal and then
reshipped back for use in
manufacturing livestock feed. State
producers – who feed their
livestock about 400,000 tons of
bean meal each year – were paying
$10 to $15 a ton for the return
shipment.
Compounding the problem,
they were receiving 75 cents
below the basis price listed at the
Chicago Board of Trade. “That’s a
considerable loss when you
consider that we’ll produce 95
million bushels of soybeans in
South Dakota this year,” said
board president Paul Casper.
Casper and his group spent two
years conducting producer
meetings across South Dakota and
Minnesota, attended by 7,000 farmers.
Some 2,100 South Dakota and Minnesota producers
invested $21 million to build the plant. Construction began in
August 1995 and last fall the first load of soybeans was
processed. An estimated 55,000 trucks will annually enter the
plant. In the first year, the plant is expected to process 15
million bushels of soybeans.
At capacity, the Volga plant will process 50,000 bushels a
day into 1,250 tons of crude meal. It will also process 265 tons
of unrefined soy oil for shipment to 2 refineries in Mankato,
Minn., for further processing into edible oil.
