This year people around the world are celebrating a business model that puts people first. In a world where the majority of businesses put profit first, this model is being called innovative. For Farmers Union, we call it history.
Farmers Union’s roots go back to Point, Texas, where, in 1902, farmers began organizing to find strength in numbers and a common voice in business and national policy. The organization’s founders were responding to business practices that took advantage of farmers. Among the first actions taken by Farmers Union was to form cooperative warehouses to store cotton until market prices would improve.
Farmers Union was built as a grassroots organization. It began at the local and county level, and then expanded into the national and state organizations. The real cooperative success story took place in the 1920s and 30s. As you know, the Great Depression and Dirty Thirties were a time of extreme difficulty across the Great Plains. Students of history will also know that the farm states entered into an economic depression in the 1920s. It was during this time that Farmers Union members worked together in earnest to create supply and marketing cooperatives, better known as Farmers Union oil and elevator co-ops. The co-ops and Farmers Union county and state organizations were formed hand-in-hand. They shared the same leaders and members. This remains true today. Farmers Union members believe in and belong to cooperatives.
One of the great examples of success in developing cooperatives grew into the nation’s top cooperative and one of the top ag businesses. CHS, Incorporated is a result of a natural merger of Cenex and Harvest States Cooperatives. If you look farther back into history, Harvest States was previously known as the Farmers Union Grain Terminal Association, or GTA. Cenex was the Farmers Union Central Exchange. These regional cooperatives supported a network of locally owned cooperatives and led to a strong and expanding system that stood the test of time. CHS survived and then thrived in the make-or-break decade of the 1930s. These cooperatives and Farmers Union shared the same members, the same history, the same goal of creating opportunities and income for farmers and ranchers. They did then, they do today.
Farmers Union’s forefathers did not stop at forming purchasing co-ops. Our members also were organizers and leaders in forming credit unions, rural electric and telephone cooperatives, and many other ag co-ops and rural co-ops. We were committed to the value of the business of working together. We were promoting viability and sustainability long before those terms were popular. Our members created marketing, supply, and service cooperatives. We started processing and value-added cooperatives. Many farms today would not be in business if they did not belong to five or more cooperatives. Obviously, we need each other. Cooperatives represent to me the one, true win-win business plan in which the customers and owners, management and employees, can all prosper together. I saw this first hand as a child when I went to work with my grandfather who managed a local farmers cooperative.
Yes, Farmers Union members belong to cooperatives. These cooperatives mean we, as producers, can and do have a measure of control over our crops and livestock, as well as our inputs, from fuel to fertilizer. The quality of life we have in rural America would be greatly diminished if not for cooperatives. It is vitally important that farmers and ranchers remember these cooperatives were started by their parents, grandparents, and great-grandparents. For this reason, you need to appreciate these cooperative businesses that work for you. And, you have a responsibility to them. Cooperatives work best in good times and bad if we as members remain dedicated, loyal, and involved.
Cooperatives adhere to the seven co-op principles, a type of mission statement that spells out how they will conduct business. Following the financial meltdown, average Americans openly questioned the ethics of Big Business and Wall Street. During this time, credit unions saw a notable increase in membership as people chose to do business with, well, businesses that were owned by individual members rather than investment groups. This comes as no surprise to us. Left unchecked, the pure profit motive has ruined a lot of people, and too often those people have been victims at the end of the line.
One of the Seven Co-op Principles is concern for community. Cooperatives are the cornerstones of many communities. Co-ops do not pack up and leave for more profitable markets. They do not change services overnight in order to boost the next quarter’s dividends to stockholders. They do not export jobs overseas because of a decision made in a boardroom far removed from reality. Cooperatives put their commitment to community into words and into actions.
Another thing cooperatives and Farmers Union share in common is a commitment to education. Together, we dedicate resources to educational programs that allow individuals to improve their personal and professional abilities. We put effort into programs that build communities. We develop and deliver engaging educational activities to youth with the goal of creating a new generation of movers and shakers who are well versed in cooperation. And, we encourage our members to be involved in our cooperatives and our organization. This summer, Farmers Union camps across the country will be teaching about cooperatives and the business of teamwork. The 2012 NFU All-States Leadership Camp is themed “Cooperation Across the Nations.” Yet, Farmers Union not only teaches about cooperatives in this special year of recognition, but we’ve also been educating all ages about this business model for 110 years.
I find it interesting that farmers started dairy co-ops so that we could control the quality of the products available to consumers. Today, consumers in large cities are forming and shopping at food co-ops because they want to know where their food comes from. Food used to be grown for local markets. In the 1950s, the rush was on to make food a big business, driven by processing, packaging, and marketing. Freshness, quality, and sustainability were left in the dust. Almost. If not for cooperatives, we would have lost something good, something great, forever. Today we are seeing new market opportunities for cooperative grocery stores, for small-scale cooperative processing and marketing co-ops. Ranchers who raise bison, farmers who grow wheat, and even families who earn their living catching seafood are embracing cooperatives as the best way to do business. Not surprisingly, consumers are finding equal value in being customers of farmer-owned cooperatives. We can and have blamed the so-called middle man for many problems. I believe today’s new and existing cooperatives are a direct connection that bypasses the middle man. Producers and consumers see this as another example of the win-win way of doing business.
Learn more at celebrating the International Year of Cooperatives: http://www.2012.coop/