Brief Summary of Minutes of Annual Meeting

2003-04 Annual Report NCR-194 Research on Cooperatives September, 2004 Administrative Advisor: Sarahelen (Sally) Thompson Department of Agricultural Economics Purdue University West Lafayette, IN 47907 Chair: Evert Van der Sluis Department of Economics South Dakota State University Brookings, SD 57007 Vice Chair Michael Boland Department of Agricultural Economics Kansas State University Manhattan KS 66506 Secretary Phil Kenkel Oklahoma State University Department of Agricultural Economics 516 Ag Hall Stillwater OK 74078-6026 Treasurers: Michael Boland and David Barton Department of Agricultural Economics Kansas State University Manhattan KS 66506 2003-04 Annual Report NCR-194 Research on Cooperatives Agriculture continues to change rapidly, creating challenges for farmers and residents of rural communities. Farm numbers continue to fall, the number of rural residents keeps declining in many rural counties, and concentration in all sub-sectors of agriculture is increasing. Cooperatives are an important means for agricultural producers to remain competitive in an increasingly industrialized agricultural economy, because they allow the producers to maintain ownership and a voice in decision-making processes. The loss of business in rural communities was identified as an important issue for rural development when this committee was organized in 1998 and remains an important concern today. Cooperatives ? whether as farm input suppliers, first handlers of farm products for agricultural producers, or credit and utility institutions ? serve as major economic drivers in local communities, and are important component of the rural infrastructure in rural areas. Across the United States and Canada, several university faculty and government researchers identify cooperatives as their primary responsibility and area of interest. Many of these individuals have ongoing working relationships with cooperatives, which enhances the relevance of their work, and the speed at which research results are disseminated and utilized. The role of NCR-194 is to facilitate and enhance these efforts by improving coordination among its members. The remainder of this report focuses on the achievements of the committee during the past year. We will outline progress made towards each of the originally stated objectives and procedures of the committee.

Objective 1. To promote and coordinate timely research on cooperatively owned business organizations for agricultural marketing, agricultural input supply, vertical coordination through value added processing, and rural services. Accomplishments during 2003-04 The establishment of NCR-194 has greatly facilitated collaboration and interaction among individuals conducting research on cooperatives. NCR-194 members continue to be actively involved in joint research projects and cooperative agreements between USDA, Cooperative Services and the Land Grant institutions. NCR-194 members are making full use of the committee?s infrastructure to communicate the results of their research to each other. During 2003-04 NCR-194 members disseminated research results during the annual meeting. NCR-194 members also used the NCR-194 web page and the list serve (described in more detail below) to communicate with each other. NCR-194 members, as well as others interested in cooperatives, accessed the selected papers presented at the each all meetings from the web page which can be found at: http://www.agecon.ksu.edu/accc/ncr194/Default.htm . Members also made use of the List Server (ncr-194-net@macc.wisc.edu) to facilitate communications among members. Messages sent to the list server are forwarded to all NCR-194 participants. Objective 2. To serve as a forum for industry and government decision makers in management and staff research positions to interact with land grant researchers and extension specialists to share research results and discuss implications for cooperative business organizations, their producer members, farm structure, efficiencies in food production and distribution, the environment and economic well being of rural communities. Accomplishments during 2003-04 The 2003 annual meeting of the NCR-194 was held in the Fairmont Hotel in Kansas City on October 29, 2003, immediately following the Farmer Cooperatives Conference. Attendance included 45 registered individuals and four walk-ins, an all time record for NCR-194 attendance. Thirty NCR-194 members were in attendance. The 2003 annual meeting consisted of a one-day forum, attended by industry and government representatives as well as representatives from universities. Industry representatives from Farmland Industries, Cenex Harvest States, Land O?Lakes, and the National Council of Farmer Cooperatives attended the conference and other represented the government sector. The meeting also included university faculty from western Canadian provinces, providing international linkages in today?s global market place. Additionally, one of our members, Chris Petersen, serves on the board of directors for CoBank. The representation from academics, industry and government, enabled strong and positive interaction between academics and others. Among the individuals attending, approximately 64% worked at academic institutions (including those working for one of the nation?s cooperative centers, as well as those with extension, research and teaching appointments, and students), 21% were employed at federal (U.S. Department of Agriculture) or state government institutions (Kansas Department of Commerce), 13% were from abroad (mainly Canada, but also Greece), and 2% had an industry background. Several NCR-194 members in attendance were members of other national research projects such as WCC-72, NE-165, National Society of Accountants for Cooperatives and other complimentary groups. Through their participation these members worked to coordinate NCR-194 member research with that of other complimentary projects. Nine research papers were presented at the meeting along. Five other research projects were presented during a poster session. Full text versions of all of the research papers and posters were posted on the NMCR-194 web page which can be found at: http://www.agecon.ksu.edu/accc/ncr194/Default.htm Topics of papers presented at the meeting included, but were not limited to, traditional and innovative ways to finance agricultural cooperatives, policy aspects related to investments in cooperatives, a international comparison of cooperative models, the impacts of Farmland?s bankruptcy on local cooperatives, current legal issues related to agricultural cooperatives, implications of identity preservation for cooperatives, and future viability of the Federated cooperatives. Topics of poster presented included, but were not limited to, assessing drivers of economic behavior in cooperatives, an analyses of the financial performance of cooperatives after engaging in mergers, and comparing alternative ways in which agricultural cooperatives? directors are selected. The one-day meeting was concluded with a banquet, held jointly with the Farmer Cooperatives group. The banquet speaker was Mr. Steven Hunt, CEO of US Premium Beef. The banquet served to facilitate a high degree of interaction between academics, industry representatives, and individuals working on government. Another important objective of NCR-194 is to attract young individuals to cooperative development. Progress toward this objective was achieved during 2003-04 through the successful pursuit of scholarships to enable a small number of students and/or early career faculty members to participate in both the NCR-194 meeting and the Farmers Cooperative Conference. NCR-194 member Mr. William Nelson, representing the Cooperative Foundation, was instrumental in making scholarship funds available. The availability of the these scholarship funds further serve as an indication of the successful working relationships between NCR-194 members working in industry and in academic settings. Summary During 2003-04, NCR-194 demonstrated numerous measurable outcomes consistent with its stated purpose and objectives. Notable accomplishment included the annual meeting attended by 49 researchers and industry professionals, presentations on 14 research projects which were also disseminated in full text form on the NCR-194 web site and active use of the NCR-194 list server to coordinate and facilitate on-going member research. NCR-194 continues to be an important vehicle for individuals of diverse backgrounds from across North America and elsewhere to meet and explore ways in which research, education and outreach activities can enhance the development and survival of rural cooperatives. As discussed above, the group continues to make excellent progress in this regard.

Presented Papers and Posters, NCR-194 2003 Annual Meeting, Kansas City Fabio R. Chaddad and Michael L. Cook, "The Emergence of Non-Traditional Cooperative Structures: Public and Private Policy Issues" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Constantine Iliopoulos, "Long-term Financing in US and European Agricultural Co-operatives: Emerging Methods for Ameliorating Investment Constraints" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm David Trechter, "A Neo-Institutional Assessment of Cooperative Evolution: Comparing the Australian Wheat Board and the Fonterra Dairy Group" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm David Barton, "Can Local Cooperatives Survive the Impact of Farmland's Bankruptcy?" hhttp://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Dave Hahn, JoAnne Paynter and Tom Sporleder, "Mutual Funds as Potential Source of Equity Capital for Traditional Ag Co-ops" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm James Baarda, "Current Law and Economics Debates: Tools for Assessing Fundamental Cooperative Changes?" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Peter Goldsmith and Karen Bender, "Ten Conversations About Identity Preservation: Implications for Cooperatives" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Bruce Anderson and Brian Henehan, "What Gives Cooperatives a Bad Name?" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Kim Zeuli, Elizabeth Howard, Brian Gould and Bob Cropp, "The Future Viability of the Federated Structure" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Julie Hogeland, "How Culture Drives Economic Behavior in Cooperatives" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Phil Kenkel, "Post Merger Financial Performance of Oklahoma Cooperatives" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm James Pritchett and Sue Hine, "A Warehouse Expansion for Potato Marketing Cooperatives" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Bruce Reynolds, "Selection and Compensation of Farmer Cooperative Directors - A Statistical Analysis" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm Joan Fulton, "Producer Investment in Value-Added Business" http://www.agecon.ksu.edu/accc/ncr194/ncr%20publications.htm