Cooperatives set sales, income records
Editor’s note: Information for this article
was compiled by the Cooperative Programs
statistics staff of USDA Rural
Development: Katherine C. DeVille,
Jacqueline E. Penn and E. Eldon Eversull.
armer, rancher and
fishery cooperatives set
a new gross sales record
of $191.9 billion in
2008, due primarily to
higher commodity prices and continued
high energy prices. Gross business
volume soared by $45 billion to eclipse
the previous record of $147 billion set
in 2007, and would have been even
higher had it not been for a sharp drop
in grain, milk and fuel prices toward the
end of the year.
Net income before taxes also set a
new record of $4.8 billion, $1 billion
more than in 2007. This is the fourth
consecutive year the nation’s
agricultural cooperatives set a record
for net income.
The main increases were realized
from sales of cotton, grain/oilseeds,
dairy, fruits/vegetables and all major
farm supplies. Grain and dairy sales
increased due to higher prices, while
most major farm supply sales grew due
to increased ingredient prices, especially
for energy and feed grains.
“These sales and income figures for
2008 show the overall strength of the
nation’s agricultural cooperatives and
point to the continued viability of the
producer-owned co-op business
structure and the crucial role of co-ops
in the economy of rural America,” says
Dallas Tonsager, under secretary for
USDA Rural Development. “But 2009
is proving to be a much more
challenging year for some co-ops and
their member-owners, especially dairy
producers, who have seen milk prices
drop to about half the peak prices
received in 2008.”
Marketing of food, fiber, renewable
fuels, farm supplies and services by coops
all increased in 2008 over the
previous year (table 1), according to the
Cooperative Programs office of USDA
Rural Development. Net business
volume of $165 billion (which excludes
sales between cooperatives) was also a
record, continuing the general upward
trend in sales that started in 2002
(figure 1).
The value of cooperative assets grew
in 2008, mainly as a result of the
increased value of inventories and
receivables, due to higher prices of
products marketed and sold (figure 2).
Equity capital held by cooperatives
increased 10 percent, to $23 billion, but
remains low, representing 33 percent of
all assets. Growth in assets was largely
financed by liabilities, which grew by
$10 billion, to $46 billion.
Patronage income (refunds from
other cooperatives due to sales between
cooperatives) grew 34 percent, to $900
million, up from $600 million in 2007.
Farmer, rancher and fishery
cooperatives remain one of the largest
employers in many rural communities,
with 178,000 workers. The number of
full-time employees decreased slightly
in 2008, to 124,000 (down 800 from
2007), while the use of part-time and
seasonal employees decreased 4 percent,
to 54,000.
Farm numbers continue to decline,
with USDA counting 2.2 million in
2008, down 0.2 percent from 2007. The
number of farmer co-ops also continues
to decline — there are now 2,473
farmer, rancher and fishery
cooperatives, down from 2,594 in
2007. Mergers account for most of
the drop, resulting in larger co-ops.
Producers held 2.4 million
memberships in cooperatives in
2008, down 3 percent from 2007.
Many farmers and ranchers are
members of more than one
cooperative, hence cooperative
memberships exceed U.S. farm
numbers.
