Agricultural Cooperative

a type of cooperative that unites agricultural producers for production or other activities needed by the members (such as processing, marketing of output, or supply of the means of production).

Agricultural cooperatives appeared in Western Europe in the first half of the 19th century and came to Eastern Europe and Russia in the second half of the century. In the imperialist stage of the development of capitalism, agricultural cooperatives in many of the modern developed capitalist countries have become complex socioeconomic organisms that encompass the production, processing, storage, and sale of agricultural products; the crediting of agriculture; and the production and supply to the farmers of the means of production for agriculture. Agricultural cooperatives often organize on the basis of vertical integration: the purchase-supply cooperatives process and market farm products and organize technical service by establishing appropriate enterprises, and the credit cooperatives, in addition to financial transactions, increasingly carry on trade operations (supply and marketing).

For many decades attempts were made to establish agricultural production cooperatives. They first appeared in the late 19th and early 20th century, but they became fairly common only in the 1960’s, owing to scientific and technological progress and the attempts by some of the small and middle farmers to join together to oppose the large capitalists. Among the capitalist countries agricultural cooperation is most highly developed in the Scandinavian countries, the Netherlands, Iceland, and Japan, where at the end of the 1960’s agricultural cooperatives processed and marketed up to 75–90 percent of all market farm products and delivered up to 60–75 percent of the means of production. In these countries the cooperatives play a decisive role in awarding agricultural credits and occupy key positions in the food industry, whosesale trade, and the production of mineral fertilizers and certain types of farm equipment.

Agricultural cooperation is not as highly developed in the other capitalist countries. In France in the second half of the 1960’s, cooperatives sold up to 40 percent of market output, delivered almost 50 percent of production goods to the farmers, and concentrated more than 75 percent of small-scale farm credit in their hands. In the Federal Republic of Germany in the late 1960’s the agricultural cooperatives accounted for 36 percent of the market output sold, 47 percent of deliveries of means of production to the farmers, and 26 percent of the credits granted to farmers. In Italy agricultural cooperatives handled up to 30 percent of the processing and selling of marketable milk, 15–20 percent of the wine, and up to 35 percent of the exported vegetables and fruits and supplied up to 30 percent of the farm credit requirement. In the United States in the late 1960’s the agricultural cooperatives were responsible for 20–25 percent of the market output sold and 20 percent of farmer purchases of the means of production. In Great Britain in the second half of the 1960’s, 10 percent of the market output was sold through the agricultural cooperatives, which also made 20 percent of the production deliveries to agriculture.

In many countries agricultural cooperatives occupy a monopoly position in the processing and marketing of most or some types of farm products, and some cooperative enterprises are among the largest processing and marketing companies.

Sweden, Norway, and, to some extent, Japan have uniform agricultural cooperative systems directed from a single center; most countries have several large agricultural cooperative centers that act independently of one another and sometimes compete.

During the transitional period from capitalism to socialism the proletarian state uses the various forms of agricultural cooperation as a means of gradually involving the working peasantry in the building of socialism.

In the developing countries of Asia and Africa agricultural cooperation arose in the late 19th and early 20th century in two ways: as voluntary organizations among the colonists of European origin and as forced associations of the local population, imposed by the colonial administration for predatory exploitation of the natural wealth in the interests of the colonial power. A fundamentally new stage in the development of the cooperative movement came when the countries received their political independence.

The governments of most new states assign a significant place to cooperation in their programs for the development of agricultural production and the entire national economy. An early form of agricultural cooperation is credit cooperation, which is most widespread in the Asian countries. Marketing cooperation is developing primarily in the African countries, where the problem of marketing the output is particularly acute for countries dominated by single-crop farming. Thus, in the mid-1960’s more than 50 percent of the peanut harvest in Senegal and 60 percent of the cotton and more than 50 percent of the coffee in Uganda were marketed through cooperatives. In the regions of the Arab Republic of Egypt where agrarian reform has been completed, all cotton marketing is done by cooperatives. Marketing cooperatives are gradually switching to primary processing of the products procured.

In the developing countries agricultural cooperation helps bring the scattered peasant masses together and promotes growth in their self-identification as a class and development of the habits of collective economic management. Thus the socio-economic prerequisites are established for these countries to switch to the noncapitalist path of development. In Latin America the trend of development of agricultural cooperatives corresponds in general to the practice of the developed capitalist countries, but with specific features based on preexisting forms of communal land use and ownership and on the implementation of agrarian reforms in many countries.