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Abstract
The context of agricultural cooperatives is undergoing major change with the
development of various food and information monitoring technologies. Large
multi-nationals have moved to take advantage of these developments with the
construction of agri-food chains. These chains are being facilitated via various
mergers, acquisitions, and alliances, with the power, and deepening power of
such deep-pocket organizations as Cargill, ADM, and ConAgra. Cooperatives
have been integrated into these chains for their core competencies, generally
for their supply functions, and capacity to handle primary commodities. These
direct links to the farmers serve as markets for biotechnology innovations, and
as a source of raw material for later processing. Agricultural cooperatives
in general are not well suited to compete with these giants, given they are
highly specialized at the first handler level. However some cooperatives are
able to enter the competition along the lines of multi-nationals competition,
i.e. non-price competition in product differentiation, branding, advertising,
research and capacity expansion. Farmland, Gold Kist, AGP, Land O'Lakes
and Growmark are examples. The cost of these positionings is to shift these
organizations toward positions that are characteristically less cooperative, and
more bureaucratic, and more top down, though likely more efficient, and with
greater market penetration.