Premium
Potential for cooperative involvement in vertical coordination and value‐added activities
Author(s) -
Royer Jeffrey S.
Publication year - 1995
Publication title -
agribusiness
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.57
H-Index - 43
eISSN - 1520-6297
pISSN - 0742-4477
DOI - 10.1002/1520-6297(199509/10)11:5<473::aid-agr2720110510>3.0.co;2-w
Subject(s) - capitalization , industrial organization , business , corporate governance , product (mathematics) , vertical integration , limit (mathematics) , value (mathematics) , distribution (mathematics) , agribusiness , agriculture , marketing , economics , finance , mathematical analysis , ecology , philosophy , linguistics , geometry , mathematics , machine learning , computer science , biology
This article analyzes the comparative advantages and disadvantages farmer cooperatives may have in coordinating the marketing of agricultural commodities through the market channel from the farm level to the processed product level. The distribution of risks among producers and integrators under contract integration is discussed, and factors related to the ownership, capitalization, and governance of cooperatives that may limit their vertical expansion are evaluated. Although contract integration by cooperatives may offer some advantages, efforts by cooperatives to limit their financial risks and the market risks of producers could significantly redefine the nature of these organizations and their relationships with members. © 1995 John Wiley & Sons, Inc.