Co-ops increase share of farm marketings;
share of farm supply sales dips slightly
Charles A. Kraenzle, Director
Statistics
E. Eldon Eversull, Agricultural
Economist
USDA Rural Development-RBS
Editor’s Note: Mr. Kraenzle died last year
during the compilation of cooperative data
for this report. Assistance in developing
estimates of cooperatives’ share of farm
marketings and farm production expenditures
was provided by the staff of the Rural
Business-Cooperative Service of USDA
Rural Development, including: Tony
Crooks, grains/oilseeds and rice; David
Chesnick, 100 largest cooperatives; Andy
Jermolowicz, fruits/vegetables and tobacco;
Bruce Reynolds, cotton/cottonseed and
Charles Ling, dairy.
armer cooperatives’ share
of total farm marketing
including crops,
livestock and poultry
climbed to 28 percent in
2001, up from 27 percent in 2000. The
market share is based on cooperatives’
net marketing business volume of $75
billion in 2001. That’s $3 billion more
than in 2000, but down from the record
$79.4 billion collected in 1996, when
the market share of co-ops peaked at 31
percent (figure 1).
Cooperatives’ gained market share
on a wide front, including milk/milk
products, fruits/vegetables, livestock,
dry beans/peas, rice, tobacco and sugar.
Most of these gains were modest, with
milk/milk products and fruits/vegetables
each climbing 1 percent and rice
gaining 2 percent. Sales decreased for
grains/oilseeds, cotton, poultry/eggs
and nuts.
Cooperatives also rang up $24.8 billion
in net sales of farm supplies in 2001,
about $700 million more than in 2000
and only $400 million less than the record
of $25.2 billion set in 1997. However,
their market share for major farm production
supplies including feed, seed, fertilizer,
crop protectants and petroleum
dropped 1 percent from 2000.
Milk sales top $20.5 billion
Farmer cooperatives paid producers
$20.5 billion for milk/milk products in
2001, up $3.5 billion from 2000. U.S.
farm cash receipts for milk/milk products
also climbed nearly $4 billion from
2000. Cooperatives’ market share of
total U.S. farm cash receipts for
milk/milk products increased from 82
to 83 percent (table 1).
However, milk/milk products market
share estimates for both years have been
revised downward by 5 to 7 points,
based on recent studies by USDA Rural
Development economist Charles Ling.
His newest study covers 2002 marketings
and will be released later this year.
The revision in milk/milk products
share lowered overall co-op market
share by 0.5 percent.
Cooperatives’ market share of
grain/oilseed marketings at the farmgate
decreased 6 percent, from 44 percent
in 2000 to 38 percent in 2001.
During 2001, farmer cooperatives paid
producers about $15 billion for their
grains and oilseeds, about $300 million,
or 2 percent, less than in 2000. Total
marketings of all grains and oilseeds
produced in the United States increased
almost 12 percent from 2000 to 2001.
Cotton and cottonseed cooperatives’
share of cash receipts was 42 percent in
2001, 7 percent less than in 2000. Farm
cash receipts for cotton and cottonseed
continue to decline, down $300 million
from last year.
Total U.S. average cash receipts for
fruits/vegetables were up almost $2 billion,
or 10 percent. Cooperatives
accounted for 19 percent of the
nation’s fruit/vegetable sales in 2001, 1
percent more than in 2000. Cooperatives’
paid fruit/vegetable producers
about $5.6 billion in 2001, up from
$4.9 billion a year earlier.
Cooperatives’ share of livestock/wool/mohair marketings was 13 percent
in 2001, 1 percent more than in 2000.
Cooperatives paid these producers $7.7
billion in 2001, almost 12 percent more
than the $6.9 billion paid in 2000.
Cooperatives’ share of “all other”
marketings including poultry/eggs,
dry edible beans and peas, tobacco,
nuts, rice, and sugar was 12 percent,
down 1 percent from 2000. Cooperatives
paid farmers $5.6 billion for “all
other” products marketed in 2001,
down 13 percent from $6.4 billion in
2000. Sharp drops in prices for sugar
and tobacco contributed to the decline.
Figure 2 shows the most recent fiveyear
market-share trends for selected
farm commodities marketed by farmer
cooperatives. Milk/milk products,
fruits/vegetables, and livestock/wool/mohair shares have been fairly
level. Grains/oilseeds and cotton/cottonseed
shares have varied, with both
trending downward in 2001.
Farm supply share dips 1 percent
Cooperatives’ share of major farm
production supply sales feed, seed,
fertilizer, crop protectants and petroleum
was 26 percent in 2001, down 1
percent from 2000. Cooperatives’
share of fertilizer, petroleum and seed
all increased while sales of crop protectants
and feed decreased (table 2,
figure 3).
Total U.S. farm cash expenditures
for the five major supply items
increased about 4 percent, to $60 billion,
from 2000 to 2001, while cooperatives’
sales growth remained flat at
$15.8 billion in both years. Cooperatives’
fertilizer sales of $4.7 billion
were up from $4.3 billion in 2000, or
about 9 percent. Total fertilizer
expenditures for all of U.S. agriculture
were up about a third of that
amount in 2001.
Cooperatives’ 46-percent share of
petroleum expenditures in 2001 was up
from 43 percent in 2000. Cooperative
sales increased by 5 percent while U.S.
petroleum sales for farm production, at
$7.2 billion, were unchanged.
Crop protectant sales for cooperatives
declined 2 percent from 2000 to
2001, to about $2.9 billion, and their
share of this market dropped one percent,
to 34 percent. Total expenditures
by all U.S. farmers for crop protectants
increased 1 percent, to $8.6 billion, during
that time.
Feed sales by cooperatives declined
about 14 percent, to $3.9 billion, while
total U.S. feed expenditures increased
1 percent, to $25 billion. Cooperatives’
share of feed expenditures
declined 3 points, to 15 percent.
The lowest market share for co-ops
among the major farm supply items is
seed. Co-ops held 13 percent of the
seed market in 2001, unchanged from
2000. Cooperatives’ seed sales
increased by $100 million, or 15 percent,
in 2001, while total U.S. cash
expenditures for seed increased 14 percent,
to $8.3 billion.
How co-op share is calculated
Cooperative-share estimates for
selected commodities and farm
supplies are based on data from several
sources. These include the annual survey
of farmer cooperatives conducted
by the Cooperative Services program
of the Rural Business-Cooperative Service,
other Cooperative Services studies,
cash receipts from farm marketings
and farm production expenditures published
by USDA’s Economic Research
Service (ERS), and from Cooperative
Services’ commodity specialists.
Cooperatives’ shares of farm
marketings represent estimates of
cooperative activity at the farm-gate,
or first-handler, level.
Cooperatives’ shares of farm marketings
were estimated by first subtracting
gross margins from net cooperative
business volume. These
estimated “payments to farmers” were
then related to their respective total
U.S. cash receipts to calculate the
percentage shares.
Shares of the major farm supply items
were estimated by subtracting from
cooperatives’ net business volume: export
business volume, sales to other firms and
supplies sold for non-farm purposes.
These adjusted business volumes were
then related to their respective total U.S.
cash expenditures to calculate percentage
share estimates.
