American farm co-ops are coming under pressure to merge from global competition, falling farm incomes, ag industry consolidation and a growing need for specialized talent, according to co-op leaders. Farmer-owned cooperatives historically have bought grain from farmers, storing it in elevators until it was loaded for shipment. But today, many co-ops do much more than store grain and sell fuel, fertilizer and pesticides.
Co-op executives say their businesses are being affected by the same economic pressures and opportunities facing other businesses, from globalization to economies of scale. As farm operations have increased in size and scale, co-ops have had to do the same, according to Ludwig. “We’re competing against big multinationals--ADM, Cargill--that are doing $100 billion in sales. We have to compete against that.”