United States

Department of

Agriculture

Rural BusinessCooperative

Service

RBS Research

Report 174
Abstract Cooperative Unification: Highlights From 1989 To Early 1999

James J. Wadsworth

RBS Agricultural Economist

This report describes cooperative unification activities, It discusses unification as a

means of strategic positioning for cooperatives, given changing industry trends and

conditions, and identifies the implications of unification and potential subsequent

strategies. Highlights of unification activities, most of them among well-known cooperatives, are described for the 1 O-year period, January 1989 - April 1999. Selected

activities are cataloged in the appendix, listed by date, naming the cooperatives

involved with a brief description of what the unification entailed.

Keywords: unification, merger, consolidation, acquisition, strategic direction

September 1999
Preface Unification activities of agricultural cooperatives recently have been making headlines,

largely due to the size of some of the partners involved. Cooperatives of all sizes have

been unifying, but the spotlight has been enhanced by the activity among large regional cooperatives. In some cases, merger partners have been other large cooperatives

and in others, smaller local cooperatives were brought into a large regional fold.

Across the nation, smaller cooperatives continue to consolidate in various agricultural

sectors.

Unification often improves.industry strategic positioning and answers the need for

growth, the lifeblood of all businesses. Unification opens opportunities for new strategic

directions: horizontal integration, vertical integration, capacity expansion, scale

economies, synergies and efficiencies, etc.

Cooperative leaders must understand the implications of unification and the impact

that such activity has on their industry and their cooperative position in it. Highlights of

selected major unification activity are provided in this report, covering the last 10

years. The listing is not an exhaustive compilation, but rather views some of the

notable unification activities across the Nation. The listing is summarized as to the

types of unification activity that took place by the cooperatives involved. The main

source was USDA’s Rural Cooperatives magazine (formerly Farmer Cooperatives). For

more recent (much of 1998 and 1999) unification activities, various news sources were

used.

i
Contents Highlights.. ........................................................ i

introduction ......................................................

..l

Unification-Strategic Positioning ......................................l

Strategic Implications ................................................3

FIBS Statistics. .....................................................5

Selected Unifications ................................................5

Summary ......................................................

.

Locations.. .................................................

.

Type of Activity .............................................l 0

Dairy.. ..............................................

..lO

Farm Supply and Grain ....................................lO

Livestock.. .....

..~.....................................lO

Fruit and Vegetable .......................................l 1

Finance......................._............_...........ll

Appendix ......................................................

..ll

Selected Unification Listings ....................................... . 0

Listing Index.. ...............................................

..17

References ....................................................

..19

ii
Highlights Unifications (mergers, consolidations, and acquisitions) have changed the agricultural

cooperative landscape. Cooperatives of all sizes and types have been uniting over the

years, but, more recently, large-scale unifications are forging a higher form of structural

change.

The reason for the increased unification activity is not surprising. Cooperatives are

being forced to examine alternative strategic directions for remaining prominent.

External trends and conditions and industry change are dictating that cooperatives

evaluate their organizations regarding their traditional position and functions.

Cooperatives are planning, adjusting, and positioning to meet future organizational

goals. Depending on circumstances and position, cooperatives have three strategic

directions to contemplate: internal change, unification, and ventures and agreements

(strategic alliances). Unification is a difficult path to choose, but many cooperatives

regard it as their best choice.

Cooperatives striving to grow and achieve stronger industry position through unification

are often presented with opportunities to employ other strategies for growth and operational improvement. Some of the major reasons for, or byproducts of, unification are

vertical integration, horizontal integration, scale economies, capacity expansion, and

synergies and efficiencies.

Unification is also necessary for consolidating fragmented industries. Many cooperatives have taken that route to gain new opportunities in such industries to better serve

members. Most commodity and service sectors of agriculture-dairy, farm supply,

grain, livestock, fruit and vegetable, and finance-have seen unification activity. Some

cooperatives are getting larger and larger and covering vast areas. Dairy Farmers of

America is often cited. If the Farmland/Cenex Harvest States consolidation occurs, a

massive regional cooperative will result. Such consolidation and changing industry

structure raise questions:

l how large can cooperatives become on a nationwide basis and still be effective

organizations that are well represented and well governed by member producers?

l will producer-members be better served, or will the dilution of joined cooperative cultures and the resulting broad governing bodies produce a watered down

level of member-owner control?

l how effective is unification for industries and their participants? Will unification

improve the remaining cooperatives and their member services?

l how will large-scale unifications affect other cooperatives (local and regional)

and various cooperative partnerships (e.g., Land O’Lakes joint feed venture

with Cenex Harvest States and GROWMARK) in this industry or related industries?

Cooperative leaders must keep abreast of these activities occurring with the widespread unifications and what they mean to their cooperative, industry, industry position,

and service to members.

. . . 111
Highlights Statistical tracking by Rural Business-Cooperative Service (FIBS) indicates 777 cooperative unifications from 1989 through 1997. Of those, 66 percent were mergers or

consolidations and 34 percent were acquisitions.

Fifty-one selected unifications for the 1 O-year period, January 1989 through April 1999,

are tabulated and cataloged. Most involved dairy cooperatives. Here are some highlights:

l

Merger forming Dairy Farmers of America (DFA) combining Mid-America

Dairymen, Milk Marketing, Inc. (MMI), Western Cooperative Dairymen, Inc.

(WCDI), and Associated Milk Producers Inc. (AMPI, southern division).

Formation of Cenex Harvest States from the unification of CENEX and Harvest

States.

0

l

l

l

Potential merger of Farmland Industries and Cenex Harvest States.

Consolidation of Land O’Lakes and Countrymark.

Unification of Land O’Lakes and Dairymen’s Cooperative Creamery.

Purchase of Gold Kist farm supply operations by Southern States Cooperative.

Purchase of SF Services by Farmland Industries.

Purchase of Agripac by Pro-Fat.

l Merger of 21 st Century Genetics, Noba, and Genex under the Cooperative

Resources International (CRI) umbrella.

l Purchase of a grape subsidiary of Tree Top, Inc., by Welch%.

l Purchase by GROWMARK of the Canadian cooperative, United Co-Operatives

of Ontario.

l Merger of Atlantic Dairy Cooperative with Land O’Lakes (LOL).

l Financial institution mergers involving CoBank, St. Paul Bank, Springfield Farm

Credit Bank, and Springfield Bank for Cooperatives.

l Acquisition of 22 local cooperatives by Riceland Foods.

l Merger of Indiana Farm Bureau Cooperative Association and Countrymark

Cooperative.

iv
Cooperative Unification: Highlights

From 1989 To Early 1999

James J. Wadsworth

RBS Agricultural Economist

Editor’s no te-Dr. ]oseph Knapp, then adminis tra tar of

USDA’s Farmer Cooperative Service, wrote in 1965: “To

merge--or not to merge. This is the problem confronting a

number of farmer cooperatives today. Times have changed

since many existing farmer cooperatives were formed. We

now have fewer and larger farms, better roads, better means

of communication, and better transportation methods and

equipment . It is possible for a cooperative to serve farmers

effectively over a much wider territory than even a decade

ago. Moreover, larger cooperatives serving larger areas can

provide more extensive services and afford better managemen t.”

Introduction

The cooperative community and agricultural

industry it represents have changed considerably in

the 38 years since the late Dr. Knapp viewed them.

Today, unifications remain in the forefront of cooperative restructuring. Large regional cooperatives are covering wider geographical areas. Traditional marketing

and membership boundaries have fallen by the wayside under the weight of unifications.

Who would have imagined 38 years after Dr.

Knapp’s observations that Dairy Farmers of America,

Land O’Lakes, Cenex Harvest States, among others,

would be as large and expansive as they are? Indeed,

some of the recent unification activities of large cooperatives have redefined the service, governance, and

operational boundaries in ways that once would not

have been feasible for a farmer cooperative. Recent

major unifications have clearly redefined and altered

the scope of agricultural markets in the United States

and the world.

This report, which focuses on unification activities of cooperatives during the past 10 years, is a followup to RBS Service Report 57 (November 1998),

Cooperafive Restructuring, 1989-2999, that cataloged

numerous restructuring activities-unifications, joint

ventures, agreements, expansions, contractions,

revampings--of agricultural cooperatives.

Unifications-mergers, consolidations, and

acquisitions-have gained greater prominence in agricultural news due to the significant involvement of

large, well-known regional cooperatives. They are unifying in what appears to be geographic and/or operational-type hopscotch patterns. Land O’Lakes, GROWMARK, Dairy Farmers of America, Cenex Harvest

States, Farmland Industries, Cooperative Resource

International, Southern States, and others have been

actively involved in considerable unifications.

Similarly, smaller cooperatives are consolidating across

the country, but at a more moderate pace, linking with

partners in nearby or adjacent operational areas.

This report begins by discussing unification as a

means of strategic positioning for cooperatives to

attain goals, given changing industry conditions and

trends. The implications follow-the strategies that

cooperatiyes use with unification and subsequent

questions and issues that must be continually assessed.

RBS data for cooperatives removed from its mailing

list because of unifications are then provided. The

report summarizes selected unifications of agricultural

cooperatives from January 2989 through April 1999

(cataloged in the appendix).

Unification-Strategic Positioning

Industry conditions often dictate strategic positioning or restructuring as illustrated in figure 1. Firms

must evaluate their strategic position because of these

factors. The figure shows the emergence of trends and

1
Figure I- Industry Dictated Strategic Positioning

Trends and Conditions

1 1 1 1 1

Organization, Adjustment, Planning, and Positioning

Organizational and System- Alternative Strategic Directions

for Goal Accomplishment

External Conditions

Decision nodes

0

Unification

conditions that cause an industry to change or consider change. This activity creates situations that require

organizations to adjust, plan, and position themselves

in the changing environment. Depending on the industry and cooperative in question, certain strategic directions will be more effective than others. They will also

vary by cooperatives as they seek to achieve goals.

Figure 1 shows cooperatives having three directional choices. They can (1) make internal changes to

improve structure, efficiencies, and operations, (2)

unify with other cooperatives or companies, or (3)

develop marketing agreements, joint ventures, strategic alliances, or other working business relationships

with other cooperatives or companies. This report

focuses on unification activity, often the hardest strategic choice a cooperative can make. Unification alters

2

cooperative culture, internal and external structure,

governance, asset base, and membership boundaries,

and often involves a drastic change in operations and

overall organizational and governance structure.

While unification creates major changes, it is not

a new concept. Looking over at least the past 10 years,

it is clear that cooperatives have been making unification choices for some time. However, more recent

activities have involved larger cooperatives and

expanded the presence of nationwide cooperatives

with broad expanses of membership. These unifications are intriguing. What do they mean? Why are

some cooperatives making the choice?

Unification implications are many, although varied, depending on the industry and cooperatives

involved. The following section identifies some of the
implications that can be expected from unification.

Some strategic and thought-provoking questions and

issues are also identified.

Strategic Implications

Unification, often conducted to achieve stronger industry position, can provide cooperatives with opportunities to use new strategies. Figure 2 illustrates cooperative strategic positioning and potential growth

channels that often result from unification. Flowing

from unification are a variety of probable strategies

that come into play. Unification develops a strategic

position that will often propel the surviving cooperative into one or more potential strategy channels: vertical integration; horizontal integration; scale

economies; capacity expansion; and synergies and efficiencies.

Figure 2 signifies that unification can create a surviving cooperative that:

l participates in two or more vertically adjacent

industries (vertical integration);

l expands an existing line of business and

amassing resources or bargaining power to

share market risks by accumulating volume

required to realize scale economies in product

procurement, sales, transportation, and distribution (horizontal integration and scale

economies);

l substantially increases assets and operational

base resulting in greater capacity and

improved use of resources (capacity expansion); and/or

0 collapses specific facets of operations into more

efficiently managed and operated central functions (synergies, efficiencies).

Examples of such strategies during unifications

are prevalent. For instance, the numerous mergers

involving Mid-America Dairymen, subsequently leading to the formation of Dairy Farmers of America,

brought about horizontal integration, economies of

size/scale, vertical integration involving value-added

products, and more efficient use of capacity production. Those, in turn, created significant growth for the

cooperatives involved and formed a cooperative of significant size and scope.

In today’s environment, growth is one of the critical unification goals. Economies of size, more market

prominence, and membership enhancement are all

growth factors that cooperatives strive to achieve.

Vilstrup, Cobia, and Ingalsbe (Cooperatives in

Agriculture, Chapter 20) contend that growth is considered a sign of a healthy, successful business, pointing out that advantages stem from economies of size

and the ability to achieve marketing and bargaining

power, political power, legislative influence, and financial strength.

The development of large regional cooperative

organizations, however, raises questions regarding

member governance and service:

How large can cooperatives become on a

nationwide basis and still be effective organizations that are well represented and well governed by member owners?

Will producer members be better served, or

will the dilution of joined cooperative cultures

and the resulting broad governing bodies

water down the level of member-owner control?

In other words, will cooperative cultures be diluted as cooperatives grow into larger and more widespread organizations, crossing broad geographic

boundaries? Will the transformed cooperatives have

less member representation and governance? And,

will those mega-cooperatives be stronger and better

able to serve members?

The ongoing and fast structural change in agricultural industries clouds the answer to these questions. Clearly, some agricultural markets need to be

consolidated for higher member benefits. Some are

fragmented by too many competing organizations,

given the number of producers involved.

It is often contended that overcoming fragmentation can be a significant strategic opportunity, and that

once consolidation barriers are overcome, the structure

of an industry can be improved for those that consolidate. The structures of agricultural industries in dairy,

farm supply, and cattle, for instance, are changing due

to consolidation. The artificial insemination industry

has seen considerable consolidation. Once an industry

with a large number of stud organizations, it has now

consolidated into four cooperatives and a select number of private firms. The dairy industry, overall, continues to see consolidation. Though fragmentation in

that industry still applies in certain areas, Dairy

3
Figure 2- Strategy Potential of Unification

Potential subsequent-strategies

Farmers of America and Land O’Lakes, for instance,

continue to gain large-scale prominence. The number

of players in the industry has shrunk.

Consolidations in the farm supply industry also

are prevalent: Land O’Lakes and Countrymark,

CENEX and Harvest States, and now the prospect of a

unified Farmland and Cenex Harvest States.

Indeed, unification activity among quite a few

cooperatives has been impressive. The changing structure of certain agricultural industries cannot be

ignored. However, overcoming fragmentation and seeing industries consolidate, perhaps toward the “rule of

three” (it asserts that there is only room for two or

three major competitors in an industry sector-the

companies that can supply the volume and service

needed to support demand), invites more questions:

l How effective is unification for industries and

their participants? Will they improve along

with the member services of the remaining

cooperatives?

l How will large-scale unifications affect other

cooperatives (local and regional and various

cooperative partnerships (e.g., Land O’Lakes’

joint feed venture with Cenex Harvest States

and GROWMARK) in this industry or related

industries?

The structural changes taking place will pressure

existing cooperatives with comparatively slight industry involvement or market share. It may force them to

consider unification or other courses of action. The

impact of such pressure must be carefully weighed.

Continuing to serve producer members in the most

efficient and beneficial way, given changing structures,

should be the ultimate goal of all remaining cooperaFigure 3 summarizes the potential impacts and

implications of unification. Given significant change

via unification, there are a number of unknowns to

contemplate. What will be the impact on:

l member service and governance,

l other cooperatives and firms,
Figure 3- Strategic Implications (Questions) of Unification

Subsequent strategies,

organizational

l industry and industry performance, and

l subsequent strategy employment and organizational/operational change?

Cooperative leaders must keep attuned to unifications affecting their cooperative and their industry

and what impact these structural changes have on the

organizations and services to members. The following

sections highlight some of the cooperative unifications

during the past 10 years.

Unifications are expected to continue, and to further alter the structure and scope of agricultural industries. Questions as to the effectiveness of further consolidation arise. The answers won’t be easy to assess,

but time and a keen eye on the impacts of such unification activity will eventually produce a clearer picture.

Research and/or analyses beyond merely describing

unification activities are needed to gain a greater

understanding of how unification is impacting industries and of its effect on cooperative cultures and opera tions.

RBS Statistics

Figure 4 graphs unification activities derived

from removals from the RBS mailing list of cooperatives from 1989 to 1997 (see appendix table 1 for the

data contained in the chart). Each year, farmer cooperatives are dropped from the mailing list because of

mergers, consolidations, acquisitions, dissolutions, etc.

The unifications included in figure 4 are those cooperatives that indicated that they merged or consolidated

with, or were acquired by, another cooperative(s). The

trend shows unification activity peaked at 135 in 1991.

Other high years were 1992 (107) and 1995 (90).

During the study period, RBS documented 777

unifications. Of those, 65.8 percent were identified as

being mergers and consolidations, and 34.2 percent

were acquisitions (appendix table 1)

Selected Unifications

Selected unifications show the scope of activity.

Tables 1 and 2 summarize those described in the

appendix by month and year.

Summary

This section summarizes the unifications

described in the appendix. In some of the text, identifying numbers given in parentheses correspond to the

5
Figure +- Unifications per FIBS Mailing List Removals

80

60

1989 1990 1991 1992 1993 1994 1995 1996 1997

Table I- Selected unification activities, by year and type, 1989 through early 1999*

Totals D S G FV L F

1999 8

1998 9

1997 4

1996 4

1995 9

1994 5

1993 2

1992 5

1991 1

1990 3

1989 1

Totals 51 20** 9 4

l ** 7 8 3

2

3

3

l *

1

4

3

3

1

1 1

5 1

1

1

1

***

1

1

1 2 1

1

1 2

1 2 1

1

1 1

1

1

1

l Numbers correspond to activities listed in Table 2 and appendix listing.

l * One of the unifications was a DHIA activity.

l ** Counted as 1 were the 22 local cooperatives acquired by Riceland Foods in 1992

D = dairy, S = farm supply, G = grain, FV= fruit and vegetable, L = livestock, F = finance.

6
Table Z- Selected unifications of agricultural cooperatives, 1989 through early 1999

# Type Cooperative(s) State Action State Year

1 s

2 L

3

4

L

G

5 F

6 FV

7 D

8

9

IO

11

12

13

14

15

16

17

18

19

20

21

22

D

D

D

S

G

S

S

D

S

S

L

D

D

D

L

Farmland, Cenex Harvest

States

21 st Century Genetics,

Noba, Genex

Central Livestock

Northwest Grains Cooperative Terminal,

Prairie States Cooperative

St. Paul Bank for

Cooperatives

AgriPac, Inc.

Maryland Virginia Milk

Producers Association

San Joaquin Dairymen,

Danish Creamery,

California Milk Producers

California Gold Dairy Products

Darigold Farms

Southern States Cooperatives

Cando Farmers Elevator

Countrymark

Farmers Petroleum Cooperative

Dairyman’s Cooperative Creamery

Farmland Industries

CENEX

Michigan Livestock Exchange

MMI, AMPI, Western Dairymen

NE DHIA

Atlantic Dairy Cooperative

Equity Livestock

MO

MN

WI

OH, NY

MN

ND

Discussing full merger 1999

Merged to form Genex, a

subsidiary of CRI

Merged into CRI

Merging to form Prairie

States Terminal

MO

MN

WI 1999

WI 1999

ND 1999

MN Merging into CoBank, ACB c o 1999

OR

VA

CA

Bought by Pro-Fat

To merge with Carolina

Virginia Milk Producers

Exploring merger

NY 1999

NC 1999

CA 1999

CA

W A

VA

ND

IN

Ml

CA

MO

MN

Ml

OH,

WI.CO

NY

PA

WI

Merging into DFA

Plans to acquire Echo Spring Dairy

Purchased farm supply from Gold Kist

Merging with Cando Farmers Union Oil

Merging with LOL

Merging with Farmland Industries

Merging with LOL

Purchased SF Services

Merged with Harvest States Cooperatives

Merged with Southern States Cooperatives

Merged with Mid-Am to form Dairy

Farmers of America

Merged with Dairylea Cooperative

Merged with LOL

Acquired Midwest Livestock

MO 1998

OR 1998

GA 1998

ND 1998

MN 1998

MO 1998

MN 1998

AR 1998

MN 1998

VA 1997

MO 1997

NY 1997

MN 1997

WI 1996

Continued

7
Table 2- Selected unifications of agricultural cooperatives, 1989 through early 1999 (continued)

# Type Cooperative(s) State Action State Year

23 D

24 L

25 FV

26 D

27 FV

26 D

29 L

30 D

31 D

32 S

33 F

34 L

35 FV

36 D

37 D

36 G

39 D

40 FV

41 L

42

43

44

45

Fort Collins MilkProducers

Eastern Al, Atlantic

Breeders, LABC

Naturipe Berry Growers

Foremost Farms

Blue Chelan, Trout, Inc.

Eastern Milk Producers

Dairylea Cooperative

Southern Milk Sales

Coble Dairy

GROWMARK

CoBank, Farm Credft

Bank, Springfield Bank

for Cooperatives

Noba, Inc.

Pro-Fat

Dairymen, Inc

Gulf Dairy

Consumers Co-op,

Farmers Union Coop Elevator

Allen Dairy

Wenoka Sales

21st Century Genetics,

WI DHIC

Dairymen’s Creamery

A-G Cooperative

22 Riceland affiliated

cooperatives

Chaseburg Cooperative

Creamery

co Joined Western Dairymen co 1996

NY. PA Merged to form Genex Cooperative NY 1996

LA

CA

WI

WA

c o

NY

AL

NC

IL

c o

MA

MA

OH

NY

KY

LA

c o

Acquired Ag Mark Produce FL 1996

Acquired Morning Glory WI 1995

Merged to form Trout-Blue Chelan WA 1995

Merged with MMI OH 1995

Purchased Empire Livestock NY 1995

Merged with MidAm MO 1995

Merged with M&Am MO 1995

Purchased United Co-operatives of Ontario Ontario 1995

Merged to form CoBank, ACB c o 1995

Merged into CRI

Purchased Curtis Burns Foods

Merged with Mid-Am

Merged with f&f-Am

Merged to form Great Plains

Cooperative

WI

NY

MO

MO

c o

ID Merged with Prairie Farms Dairy IL

WA Merged with Majestic Valley Produce WA

WI Merged and formed CRI WI

ID Merged wtth Darigold Farms WA

WI Merged with Mid-Am MO

AR Acquired by Riceland Foods AR

WI Merged with T&State Milk

Cooperative

WI

1995

1994

1994

1994

1994

1994

1993

1993

1992

1992

1992

1992

Continued
Table 2- Selected unifications of agricultural cooperatives, 1989 through early 1999 (continued)

# Type Cooperative(s) State Action State Year

46 FV

47 S

48 D

4g s

50 FV

51 F

Fruita Consumers Cooperative CO

Indiana Farm Bureau, IN

Cooperative Countrymark

Greenwood Milk Producers WI

Monroe Service, Randolph Service IL

Welch’s (National Grape NY

Cooperative)

Jackson Bank, Spokane Bank MS

WA

Bought United Fruit Growers c o 1992

Merged to create Countrymark Cooperative IN 1991

Merged with LOL MN 1990

Merged to form Gateway FS IL 1990

Bought Tree Top subsidiary U.S. Grape WA 1990

Merged with National Bank for Cooperatives CO 1989

# corresponds to number in unification listing of appendix.

numbering of each activity listed in table 2 and the

appendix. Readers may want to read certain descriptions for additional information.

Locations

To provide a general overview of where unifications have been occurring across the Nation during the

past 10 years, figure 5 maps the locations of the selected unification activities included in table 2 and cataloged in the appendix. All 10 years are commingled.

Some dots represent more than one activity. No correlation can be made between the markings, i.e., what

cooperative locations are linked through unification

with other cooperative locations.

Given this depiction, cooperative unifications

occurred in a broad and scattered pattern across the

United States, most of it in Washington State,

California, the Midwest, the Mid-South, and parts of

the East.

7ype of Activity

Unification listings are labeled by a code letter in

parentheses identifying the type of unification activity

described. Code letters consist of the following:

(D) - Dairy

(S) - Farm supply

(L) - Livestock

(G) - Grain

(Fv) - Fruit and/or vegetable

(F) - Finance

The code letter does not necessarily indicate the

cooperatives involved by their type, but rather by the

type of operational activity described by the unification. In some cases, the activity might actually have

crossover implications. For example, a grain activity

may also be a farm supply activity, and vice versa.

Table 1 provides the number and type of the

selected unification activities cataloged. Fifty-one

activities are listed, headed by 20 dairy unifications, 9

in farm supply, 7 in fruit and vegetable, and 8 in livestock. Four cooperative activities occurred in grain and

three involved finance (CoBank and its counterparts).

DaiwMid-America Dairyman of Missouri

unified with Dairymen Inc. (36) of Kentucky and a

number of relatively small dairy cooperatives (43,37,

36,31,30)’ prior to forming Dairy Farmers of America

in 1997 (19). Milk Marketing, Inc. of Ohio and Eastern

Milk Producers of New York merged in 1995 (28) and

the resulting cooperative subsequently teamed with

Mid-America Dairymen, AMP1 Southern Region, and

WCDI of Colorado to form Dairy Farmers of America

(DFA) in 1997. Recently, California Gold Dairy

Products voted to merge with DFA (9).

Land O’Lakes (LOL) was involved in significant

activity, pulling Atlantic Dairy of Pennsylvania (21)

and Dairyman’s Cooperative Creamery of California

(15) into its fold. LOL also unified on the farm supply

side, acquiring Countrymark of Indiana in 1998 (13).

A significant potential unification event not listed was

9
Figure +Locations of Cooperatives Involved in Selected Unifications

Unifications

0 Location

- States, USA

LOL’s talks with AG Processing that were later terminated. Greenwood Milk Producers of Wisconsin joined

LOL in 1990 (48).

Dar&old expanded its presence in the Northwest

by adding Dairymen’s Creamery Association of Idaho

in 1992 (42) and acquiring Echo Spring Dairy of

Oregon in 1998 (11).

On the East coast, Maryland and Virginia Milk

Producers is merged with Carolina Virginia Milk

Producers (7) in early 1999 while Florida Dairy

Farmers and Tampa Independent Dairy Farmers

merged to form Southeast Milk, Inc., in Florida (10).

The nation’s third largest dairy cooperative may

be formed in California if merger talks succeed among

San Joaquin Dairymen, Danish Creamery Association,

and California Milk Producers (8).

Farm Supply and &&-A major

unification in farm supply occurred by combining

CENEX and Harvest States to form Cenex Harvest

States Cooperatives (17). Farmland Industries had two

significant activities in 1998-a merger with Farmers

Petroleum Cooperative of Michigan (14) and the

acquisition of SF Services of Arkansas (16). And

topping those activities are the unification talks

between Farmland Industries and Cenex Harvest

States (1).

Southern States purchased Gold Kist’s retail farm

supply business in 1998 (6) and greatly expanded its

marketing territory into the Southeastern States. In

another major acquisition, LOL purchased

Countrymark’s primary farm supply businesses in

1998 (13). An interesting linkage was GROWMARK’s

purchase of a Canadian cooperative, United Co-operatives of Ontario (32).

In 1992, Riceland Foods acquired 22 of its local

member grain drying cooperatives (44). Great Plains

Cooperative in Colorado was formed from the merger

of two Colorado grain cooperatives, making it one of

the largest cooperatives in Colorado (38).

10
Livestock-The livestock industry has seen

considerable unification during the lo-year period.

Both a farm supply and a dairy cooperative were

involved-Southern States of Virginia merged with

Michigan Livestock Exchange (18), and Dairylea

Cooperative acquired Empire Livestock, both

operating in the State of New York (29).

Furthermore, a significant merger took place

among three artificial insemination cooperatives to

form Genex (24). It also joined Cooperative Resources

International (CRI), a holding cooperative developed

in 1993 from the partial merger of 21st Century

Genetics (artificial insemination cooperative) and

Wisconsin DHIC, a dairy herd improvement cooperative (41). Noba Inc., of Ohio joined CR1 in 1995 (34).

CR1 unification continued when Central Livestock of

Minnesota joined the fold (3), and the three AI subsidiaries (21st Century Genetics, Noba, and Genex)

merged, resulting in just one AI subsidiary, Genex (2),

under the CR1 umbrella.

Among livestock marketing cooperatives in

Wisconsin, Equity Livestock acquired Midwest

Livestock, substantially increasing the size of the surviving organization (22).

Fruit and Vf?gefBble-Cross-Nation

unifications occurred in the fruit an vegetable category.

Welch’s (owned by National Grape Co-operative) of

Massachusetts purchased Washington-based U.S.

Grape, a subsidiary of Tree Top, Inc., in 1990 (50).

Naturipe of California purchased Florida Berries in

1996 (25). Among regional activity, Blue Chelan and

Trout cooperatives, both in Washington State, merged

to form Trout-Blue Chelan in 1995 (27), Pro-Fat

acquired Curtice Burns, both in New York, in 1994 (35),

and Fruita bought United Fruit, both in Colorado (46).

Finance--Three consolidations took place in

the cooperative finance arena. In 1989, the Jackson

Bank for Cooperatives in Mississippi and the Spokane

Bank for Cooperatives in Washington merged into the

National Bank for Cooperatives (51). In 1995, CoBank,

the Springfield Farm Credit Bank, and the Springfield

Bank for Cooperatives merged to form CoBank,

Agricultural Credit Bank (33). Then, early this year

(1999), the St. Paul Bank for Cooperatives, the last of

the former district banks, merged with CoBank, ACB

(5). CoBank became the parent lending institution for

the entire Farm Credit System.

Appendix

Selected Unification Listings

Unification listings are organized by date (month

and year reported) and are numbered for reference.

The code letter in parentheses identifies the unification

activity described (see text). Descriptions were gleaned

from various news sources and from USDA’s Rural

Cooperatives magazine (formerly Farmer

Cooperatives). Those from outside the magazine have

an asterisk (*) next to the heading.

April 1999

(S) Farmland, Cenex Harvest States Work Toward

Consolidation*

Farmland Industries, Inc., Kansas City, MO, and

Cenex Harvest States Cooperatives, St. Paul, MN,

announced plans to explore a complete combination

of the two agricultural cooperatives. The resulting

cooperative would create an agricultural giant with

$20 billion in annual revenue. Both boards of directors have approved the talks leading to the proposed unification.

(L) CRI AI Subsidiaries Consolidated*

Delegates representing members of Cooperative

Resources International (CRI), Shawano, WI,

approved the merger of the separate AI subsidiaries-21st Century Genetics, Shawano, WI;

Noba, Tiffin, OH; and Genex, Ithaca, NY; into one

subsidiary, Genex.

(L) Central Livestock Joins CRI*

Delegates representing members of CR1 approved

the consolidation of Central Livestock Association,

St. Paul, MN, into CRI, Shawano, WI. Central

Livestock joins AgSource and Genex as subsidiaries

of CRI.

March 1999

4. (G) Northwest Grain and Prairie States to Merge*

Northwest Grain Co-operative Terminal, Williston,

ND, will merge with Prairie States Cooperative,

Zahl, ND, to form Prairie States Terminal. The consolidation involves a combined membership of

1,800 producers, who overwhelmingly approved

the combination. Northwest Grain operates grain11
marketing terminals in five communities. Prairie

States is a full-service cooperative with programs in

grain, fertilizer, fuel, and chemicals.

5. (F) CoBank, ACB, St. Paul Bank Agree To Merge*

Pending shareholders approval, CoBank, ACB,

Denver, CO, and St. Paul Bank (MN) will form a

bank with $22 billion in assets. Both banks are part

of the $84 billion U.S. Farm Credit System. The St.

Paul Bank has $2.3 billion in assets and serves 600

agricultural cooperatives and rural utility customers

in the upper Midwest. CoBank, ACB, has $20 billion

in assets, finances agricultural exports, and serves

2,000 agricultural cooperatives, rural utility systems,

and farm credit associations. The merger will create

the nation’s largest Farm Credit System bank.

February 1999

6. (FV) Pro-Fat Cooperative Completes Acquisition of

Agripac*

Pro-Fat Cooperative, Inc., Rochester, NY, and its

wholly owned subsidiary, Agrilink Foods, Inc., has

acquired the frozen food business of Agripac, Inc.,

Salem, OR. Agripac had approximately $130 million

in annual sales. Pro-Fat will operate the business

through its subsidiary, Pro-Fat Acquisition II, Inc.

Agrilink will provide the subsidiary with management and administrative services.

January 1999

7. (D) Maryland and Virginia Milk Producers To

Merge With Carolina Virginia Milk Producers*

Maryland and Virginia Milk Producers Association,

Inc., Reston, VA, the largest dairy cooperative in

Virginia, plans to merge with Carolina Virginia Milk

Producers Association, Charlotte, NC. Directors of

both cooperatives approved the consolidation plan.

The new cooperative would serve more than 1,550

dairy farmers in 11 States and market about 3 billion pounds of milk a year.

8. (D) Three California Cooperatives Explore Merger*

Three California dairy cooperatives are contemplating a merger that would create one of the largest

milk-producing associations in the Nation. The

trio-San Joaquin Valley Dairymen, Los Banos,

Danish Creamery Association, Fresno, and

California Milk Producers, Artesia-represent 700

dairymen and 44 percent of the State’s milk production. The merger would make the cooperative the

State’s largest and the nation’s third biggest with an

estimated revenue of nearly $2 billion.

December 1998

9. (D) California Gold To Merge with DFA

Members of California Gold Dairy Products,

Petaluma, CA, the Nation’s 12th-largest milk marketing cooperative, have voted overwhelmingly to

join Dairy Farmers of America (DFA), Kansas City,

MO. California Gold’s 330 members in California

and Nevada produce 2.5 billion pounds of milk

annually, about half of which is marketed as fluid.

10. (D) Florida Dairy Cooperatives Merge

Florida Dairy Farmers Association and Tampa

Independent Dairy Farmers Association have

merged to form Southeast Milk Inc.

Headquartered in Belleview, FL, Southeast Milk is

the only Florida-based dairy cooperative. Its 253

members have a combined annual milk volume of

some 2.8 billion pounds, or about 90 percent of the

milk produced in the State.

October 1998

11. (D) Darigold To Purchase Echo Spring Dairy

Darigold Farms, a major dairy cooperative in the

Pacific Northwest (Seattle, WA), agreed to purchase Echo Spring Dairy, an Oregon-based company that offers a full line of fluid milk products, cottage cheese, and sour cream. Darigold Farms has

been a major supplier to Echo Spring, providing

about 85 percent of its milk needs. The purchase

will combine Echo Spring’s 105 workers with

Darigold’s 1,300 employees.

12. (S) Southern States/Gold Kist Deal Complete*

Southern States Cooperative, Inc., of Richmond,

VA, has purchased of the wholesale and retail farm

supply business from Gold Kist Inc. of Atlanta,

GA. By early November, Southern States expects to

have its signs on 100 former Gold Kist retail farm

supply stores as well as peanut and grain buying

stations, cotton gins, fertilizer plants, feed mills

and crop protection distribution centers in South

Carolina, Georgia, Florida, Alabama, Mississippi,

Arkansas, Louisiana, and Texas.

12
September 1998

13. (S) Countrymark, LOL Members Approve

Purchase*

Members of Land O’Lakes, Inc. (LOL),

Minneapolis, MN, and Countrymark Cooperative,

Inc., Indianapolis, IN, approved LOL’s acquisition

of Countrymark’s primary farm supply businesses.

Ninety percent of the members of the two organizations supported the acquisition which will fold

Countrymark’s seed, agronomy, and feed businesses into LOL, expanding LOL’s market territory and

membership deep into the eastern Midwest, and

make it the third-largest commercial feed manufacturer in the U.S. The acquisition also includes

Countrymark’s petroleum distribution business

and involves establishing joint ventures with

Countrymark and GROWMARK, Inc., in feed,

seed, and petroleum.

July 1998

14. (S) Farmland and Farmers Petroleum Propose

Merger*

Farmland Industries, Inc., of Kansas City, MO,

plans to merge with Farmers Petroleum

Cooperative, Inc., of Lansing, MI. Farmers

Petroleum, which has 4,100 members, is owned by

Michigan farm cooperatives, individual farmers,

and the Michigan Farm Bureau. Petroleum continues to be a major business unit for Farmland.

Under the merger, Farmland will operate Farmers

Petroleum’s five retail facilities.

May 1998

15. -(D) Land 0’ Lakes, Dairyman’s Creamery Merger

Plan Approved*

Members of Land O’Lakes of Minneapolis, MN,

and Dairyman’s Cooperative Creamery

Association of Tulare, CA, approved a merger that

will make LOL a $5 billion national cooperative.

LOL will beef up its presence in the West The two

cooperatives have a long history together.

Dairyman’s has been making butter for LOL for 15

years.

16. (S) Farmland To Buy SF Services*

SF Services of North Little Rock, AR, whose smalltown farm supply stores produced sales of $623

million in 1997, has been purchased by Farmland

Industries, Inc., of Kansas City, MO. Arkansas has

at least 83 SF-affiliated stores. Another 420 locations are scattered through east Texas, Mississippi,

Louisiana, and Oklahoma, with some locations in

Alabama and Kansas. The sale required approval

by 126 store-owning members of SF.

March 1998

17. (S) CENEX, Harvest States Members Approve

Unification

The members of CENEX, Inc., and Harvest States

Cooperatives, both of St. Paul, MN, overwhelmingly approved unification to form CENEX

Harvest States Cooperatives, one of the nation’s

largest farmer-owned cooperatives. The unification

will take effect June 1,1998. About 88 percent of

CENEX members and 91 percent of Harvest States

members favored the merger. Their businesses

span the full range of food production from farm

supplies to processing and marketing to consumer

products.

November/December 1997

18. (L) Southern States, Michigan Livestock Eye

Merger

Michigan Livestock Exchange at East Lansing and

its subsidiaries, which have 60,000 members and

sales that topped $700 million in 1996, will become

the livestock marketing division of Southern States

Cooperative based at Richmond, VA, under a proposed merger.

September/October 1997

19. (D) Dairy Farmers of America Formed

Members of four leading U.S. dairy marketing

cooperatives (Mid-America Dairymen, Milk

Marketing Inc., AMP1 Southern Region, and

WDCI have voted to form Dairy Farmers of

America at Kansas City, MO. The new cooperative

will handle about 21 percent of the nation’s milk

supply; serve 22,000 members in 42 States; will

have combined sales of nearly $7 billion; and will

market more than 32.5 billion pounds of milk

(1996).

13
March/April 1997

20. (D) Dairylea, DHIA Combining Operations

Cooperative Dairy One Inc., has been formed from

the merger of Northeast Dairy Herd Improvement

Association, Ithaca, NY, and Dairylea Cooperative,

Inc., of Syracuse, NY. It’s mission is to bring about

needed changes in the dairy industry.

21. (D) Atlantic Dairy, Land O’Lakes Merge

Members of two of the Nation’s leading dairy marketing cooperatives have approved the merger of

Atlantic Dairy Cooperative (ADC), of

Philadelphia, PA, with LOL of Minneapolis, MN.

The merger solidifies a 17-year relationship

between the two cooperatives. ADC’s administrative operations at Southhampton, PA, will be

maintained, as will its field staff and the staff of its

Holly Milk manufacturing operation. ADC will

adopt L,OL,‘s governance system and its members

will join LOL.

July/August 1996

22. (L) Equity Livestock Acquires Midwest in

Wisconsin

The largest livestock marketing cooperative in

Wisconsin, Equity Cooperative Livestock Sales

Association at Baraboo, has become the dominant

cooperative of its type in the State with its purchase of Midwest Livestock Producers of Francis

Creek.

May/June 1996

23. (D) WDCI, Fort Collins Milk Producers Unify

Fort Collins (CO) Milk Producers Association, a

dairy marketing cooperative with seven members

who produce 2 million pounds of milk annually,

has joined Western Cooperative Dairymen, Inc., of

Thornton, CO.

March/April 1996

24. (L) Livestock Breeding Cooperatives (Atlantic

Breeders, Eastern AI, LABC) Merge

Members of Atlantic Breeders Cooperative of

Lancaster, PA, Eastern A.I. Cooperative, Ithaca,

NY, and Louisiana Animal Breeders Cooperative,

Baton Rouge, LA, overwhelmingly approved

merger plans to form Genex Cooperative. The pro25. (FV) Naturipe Acquires Florida Berries

posal also made Genex a subsidiary of Cooperative

Resources International, an AI holding cooperative

based at Shawano, WI. The three cooperatives had

been working together since 1986 in a partnership

called Federated Genetics.

Greater timely access to markets in the East and

Southwest will be achieved through an agreement

between Naturipe Berry Growers of Watsonville,

CA, and Ag Mark Produce, Inc., of Plant City, FL.

Berries grown in Florida will be marketed under

the Naturipe label. The Florida source will allow

Naturipe, a berry-marketing cooperative, to serve

the eastern markets at a lower cost during a time

when California supplies are limited.

October 1995

26. (D) Foremost Farms To Buy Morning Glory

Foremost Farms USA, Baraboo, WI, has announced

plans to acquire the Morning Glory Farms Region

of Associated Milk Producers, Inc. (AMPI),

Shawano, WI-one of San Antonio-based AMPI’s

three regions. Both cooperatives have facilities and

members concentrated in Wisconsin and northern

Illinois. Foremost Farms was created last year by

the 1994 consolidation of Wisconsin Dairies

Cooperative and Golden Guernsey Dairy

Cooperative.

September 1995

27. (FV) Washington Apple Co-ops (Blue Chelan,

Trout) Merge

Washington’s largest grower-owned apple cooperative was formed Sept. 1 when two apple cooperatives-Blue Chelan Inc., and Trout, Inc.-merged.

The new association, Trout-Blue Chelan, Inc., represents about 300 growers and will pack 5 million

boxes of fruit worth $70 million annually.

May 1995

28. (D) MM1 and Eastern Milk Approve Merger

The nation’s third largest dairy cooperative has

been created by delegates voting to merge Eastern

Milk Producers Cooperative, Syracuse, NY, and

Milk Marketing, Inc. (MMI), Strongsville, OH. The

new cooperative will retain the MM1 name and

14
incorporate Eastern’s cow logo into the new logo.

The new cooperative has 9,000 farm family members in an area stretching from Indiana to Vermont.

It will process 7 billion pounds of milk worth $1

billion, annually. More than 95 percent of the voting members of each cooperative approved the

merger.

29. (L) Dairylea Acquires Empire Livestock

Dairylea Cooperative Inc., Syracuse, NY, has

assumed ownership and control of the assets of

Empire Livestock Marketing Cooperative, Ithaca,

NY. Dairylea plans to operate Empire as a fully

autonomous subsidiary. Dairylea has been providing administrative services for Empire since the

early 1990s. Empire is the largest livestock marketing organization in the Northeast, operating nine

markets across New York State.

March 1995

30. (D) Southern Milk Sales Merges with Mid-Am

Southern Milk Sales (SMS), Montgomery, AL,

merged with Mid-America Dairymen, Inc.,

Springfield, MO. Mid-Am has managed SMS operations on a contract basis for the past 3 years.

Coordination of marketing programs was the goal

when the management contract was established

with full merger to follow.

February 1995

31. (D) Coble Dairy To Merge with Mid-Am

32.

Members of Coble Dairy, Lexington, NC, voted

unanimously to merge with Mid-America

Dairymen, Inc., Springfield, MO. The recent merger of Mid-Am and Dairymen, Inc., and their subsequent aggressive marketing program and strong

position in Class I fluid milk market in the

Southeast prompted the merger. It provides Coble

with the opportunity to preserve members’ equity

and market milk profitably in the future.

(S) Canadian, U.S. Co-ops (UCO, GROWMARK)

Join Forces

GROWMARK, Inc., Bloomington, IL, has purchased the assets of United Co-operatives of

Ontario-the largest farm supply and marketing

cooperative in the Canadian province-for $34

million. Despite geographic differences, the agri33. (F) CoBank, Springfield Banks To Consolidate

Stockholders of CoBank, the Farm Credit Bank of

Springfield (MA), and the Springfield Bank for

Cooperatives have overwhelmingly approved

their consolidation to form CoBank, ACB

(Agricultural Credit Bank). The new bank will be

based in Denver, CO. The merger is intended to

present a significant opportunity for all the banks

to improve service to customer-owners, strengthen

financial performance, and achieve strategic business objectives. The consolidated bank will act as a

wholesale lender to the Farm Credit Association

serving cooperatives and associations in eight

States of the First Farm Credit district.

34. (L) Noba Joins CRI*

culture of Ontario and of the Midwest are compatible because they have strong roots in cooperation

among farmers.

Noba, Inc., an artificial insemination cooperative

in Tiffin, OH, merged into Cooperative Resources

International (CRI), Shawano, WI. Noba becomes

the third subsidiary of CR1 and joins 21st Century

Genetics and Wisconsin DHIC.

December 1994

35. (FV) Pro-Fat Completes Acquisition of Curtice

Burns

Pro-Fat Cooperative, Inc., a 700-member agricultural marketing cooperative at Rochester, NY, has

completed its acquisition of Curtice Burns Food,

Inc. It will become a wholly-owned subsidiary of

Pro-Fat. Both will continue to operate under two

separate boards. The two had been partners in a

joint venture in which Pro-Fat was the primary

supplier of fruits and vegetables processed by

Curtice Burns.

November 1994

36. (D) Mid-Am, DI Merger Receives Justice Approval

The merger of Mid-America Dairymen, Inc., of

Springfield, MO, and Dairymen, Inc., of Louisville,

KY, has been approved by the U.S. Justice

Department, clearing the way for the cooperatives

to file required merger certification papers with

the States of Kansas and Kentucky, respectively,

where the cooperatives are chartered. With more

15
than 92 percent of Mid-Am’s 360 delegates voting,

93.4 percent favored the merger. The new cooperative will continue to use the Mid-Am name. The

merger will combine Mid-Am’s 14,000 members

with DI’s 3,000 members in an organization that

will cover much of the United States.

June 1994

37. (D) Gulf Dairy To Merge with Mid-Am

Gulf Dairy Association, Kentwood, LA, has voted

to merge operations with Mid-America Dairymen,

Inc., Springfield, MO. Gulf Dairy will operate as a

sub-region within Mid-Am’s existing Southern

Division. Also, Highland Dairy-Mid-Am’s joint

venture with Prairie Farms Dairy Inc., Carlinville,

IL-has acquired Gilt Edge Dairy, a subsidiary of

the Dean Milk Co. in Norman, OK. Prairie Farms

manages Hiland while Mid-Am supplies the raw

milk.

April 1994

38. (G) Colorado Co-ops Join Forces

Members of Consumers Co-op, Inc., and Farmers

Union Co-op Elevator, both in Wray, CO, have consolidated their operations. Eighty percent of the

members voting favored unification. The new

cooperative, known as Great Plains Cooperative,

Inc., will be one of the largest in Colorado.

February 1994

39. (D) Prairie Farms, Allen Dairy Merge

Allen Dairy, Fort Wayne, ID, has merged with

Prairie Farms Dairy, Inc., Carlinville, IL. Allen

Dairy processes 130 million pounds of fluid milk

annually and has about 100 members.

October 1993

40. (FV) Wenoka Announces Merger

Wenoka Sales, the marketing division of the

Wenatchee (WA) Okanogan Cooperative

Federation, has merged into a new company,

Majestic Valley Produce, also headquartered in

Wenatchee. Majestic will market for Wenatchee’s

six warehouses plus three other packing sheds. Six

of the nine members of Majestic are cooperatives.

February 1993

41. (D) 21st Century Genetics, Wisconsin DHIC Merge

to Form CRI*

Cooperative Resources International (CRI), a holding cooperative, formed by 21st Century Genetics,

an artificial insemination cooperative from

Shawano, WI, and Wisconsin DHIC (WDHIC),

Verona, WI. Several operations from both cooperatives are combined under the new holding cooperative.

May 1992

42. (D) Dairymen’s Creamery Association Merges

with Darigold

Dairymen’s Creamery Association @CA),

Caldwell, ID, has merged with Darigold Farms at

Seattle, WA, retroactive to Dec. 1,1991, when DCA

members approved the combination. The 76-yearold DCA has been serving diary farmers in northern Idaho and eastern Washington State. The

merger is the latest in a number of new changes for

Darigold in the past few years. It recently opened a

new manufacturing plant in Sunnyside, WA.

43. (D) Mid-Am, A-G Cooperative Consolidate

A-G Cooperative in Arcadia, WI, has consolidated

with Mid-America Dairymen, Inc., Springfield,

MO. The addition of AG’s members and state-ofthe-art cheese plant and whey processing center is

expected to fill a void in Mid-Am’s Northern

Division. Consolidation assured continuation of

the plant at Arcadia and market security for members through Mid-Am.

February 1992

44. (G) Twenty-two Riceland Co-ops Acquired

Riceland Foods, Inc., Stuttgart, AR, has acquired

22 affiliated local grain-drying cooperatives.

Nearly 6,000 members of the affiliates participated

in the vote, with 94 percent favoring the move. The

total package cost Riceland about $48 million

including obligations to redeem $34 million in

equities and $13.6 million in long-term debt.

Current and former members received $11.6 million in redemptions of the dryer’s certificates of

equity. Members saw immediate benefits in the

form of lower drying charges and the freedom to

deliver grain to the nearest facility. Over the next 5

16
years, Riceland plans to invest $30 million for

improvements. The former affiliate boards will be

continued to provide marketing advice to

Riceland, collect and distribute earnings derived

from grain origination, and redeem members’ allocated equity.

January 1992

45. (D) Wisconsin Dairy Co-ops (Tri-State Milk,

Chaseburg Coop Creamery) Merge

Two Wisconsin dairy cooperatives have agreed to

merge. The move allows both Tri-State Milk

Cooperative at West Salem and Chaseburg

Cooperative Creamery Company to continue their

operations. The surviving Tri-State, which previously had no processing facility, will supply milk

to Chaseburg so its cheese plant can operate more

efficiently.

46. (FV) Fruita Buys United Fruit Growers

Fruita Consumers Cooperative Association, Inc.,

Fruita, CO, will acquire United Fruit Growers,

Palisade, CO. United will continue to operate

under its branch manager. Its retail operations at

East Valley will expand to handle farm production

supplies. The fruit packing and marketing functions will be continued. New contracts and additional fruit growers will be sought.

September 1991

47. (S) Indiana Farm Bureau, Countrymark Merge*

Indiana Farm Bureau Cooperative Association,

Indianapolis, IN, and Countrymark, Inc.,

Indianapolis, IN, merged to form Countrymark

Cooperative.

November 1990

48. (D) Greenwood Co-op Joins LOL

Members of Greenwood (WI) Milk Products

Cooperative voted to join Land 0’ Lakes, Inc.

(LOL), at Minneapolis and thereby relinquish the

Class A member status they had held for the past

25 years. Greenwood will become LOL’s seventh

major plant and first in central Wisconsin. It provides a strategic link between LOL’s Minnesota

service area and members of its Lake to Lake subsidiary in eastern Wisconsin.

October 1990

49. 6) Illinois Co-ops Form Gateway FS

Two southwestern Illinois cooperatives-Monroe

Service Company and Randolph Service

Company-have merged to form Gateway FS, a

grain marketing and farm supply cooperative at

Red Bud, adjacent to the cooperative’s grain elevator. Combined volume of the new cooperative will

be $73 million. The new operation will have 100

employees and facilities at 14 locations in adjoining Monroe and Randolph counties. Gateway is

expected to save $200,000 a year after its first year

of consolidation by eliminating duplicate insurance, audits, annual meetings, and personnel.

April 1990

50. (FV) Welch’s Completes U.S. Grape Purchase

Assets and operations of U.S. Grape, Sunnyside,

WA, have been transferred from Tree Top, Inc., an

apple-processing cooperative at Selah, WA, to

Welch’s. Sale of the former Tree Top subsidiary to

Welch’s was formally completed earlier this year.

Facilities were closed and offered for sale. Stored

juices were transferred to Welch’s facility at

Grandview, WA. The 51 grape growers, who had

contracted more than 1,000 acres of vineyards to

U.S. Grape, became members of National Grape

Co-operative that owns Welch’s.

January 1989

51. (F) Jackson, Spokane Join National Bank for

Cooperatives

The addition of the Jackson and Spokane Banks for

Cooperatives gives the new National Bank for

Cooperatives (NBC) a base of about 2,400 stockholders, $11.3 billion in assets, and $8.8 billion in

loans outstanding, based on June 30,1988 figures.

Stockholders in the Jackson and Spokane districts

approved the merger with NBC and stockholders

in the eight other districts, both by number and

equity, and the Central Bank also approved it for

cooperatives in Denver.

Listing Index

April 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

1. (S) Farmland, Cenex Harvest States Work

Toward Consolidation* . . . . . . . . . . . . . . . . . . .ll

2. (L) CR1 AI Subsidiaries Consolidated* . . . . . . . . .ll

3. (L) Central Livestock Joins CRI* . . . . . . . . . . . . . . .11

17
March 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

4. (G) Northwest Grain and Prairie States

toMerge* . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..ll

5. (F) CoBank, ACB, St. Paul Bank Agree

ToMerge* . . . . . . . . . . . . . . . . . . . . . . . . . . . ...12

February 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

6. (FV) Pro-Fat Cooperative Completes

Acquisition of Agripac” . . . . . . . . . . . . . . . . .12

January 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

7. (D)

8. (D)

Maryland and Virginia Milk Producers To

Merge With Carolina Virginia Milk

Producers, . . . . . . . . . . . . . . . . . . . . . . . . . . ...12

Three California Cooperatives Explore

Merger+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...12

December 1998 ............................... 12

9. (D) California Gold To Merge with DFA ....... .12

10. (D) Florida Dairy Cooperatives Merge ....... .23

October 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

11. (D) Darigold To Purchase Echo Spring

Dairy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...12

12. (S) Southern States/Gold Kist Deal

Complete* . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

September 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

13. (S) Countrymark, LOL Members

Approve Purchase* . . . . . . . . . . . . . . . . . . . . .13

July 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -13

14. (S) Farmland and Farmers Petroleum

Propose Merger* . . . . . . . . . . . . . . . . . . . . . . . .13

May 1998 .................................... 13

15. (D) Land 0’ Lakes, Dairyman’s Creamery

Merger Plan Approved* .................13

16. (S) Farmland To Buy SF Services* ............13

March 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

17. (S) CENEX, Harvest States Members Approve

Unification . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

November/December 1997 . . . . . . . . . . . . . . . . . . . . .13

18. (L) Southern States, Michigan Livestock

EyeMerger . . . . . . . . . . . . . . . . . . . . . . . . . ...13

September/October 1997 ..................... ..13

19. (D) Dairy Farmers of America Formed ....... .13

March/April 1997 ............................. 14

20. (D) Dairylea, DHIA Combining Operations ... .14

21. (D) Atlantic Dairy, Land O’Lakes Merge ..... .14

July/August 1996 ............................. 14

22. (L) Equity Livestock Acquires Midwest

in Wisconsin .......................... .14

May/June1996 ............................. ..14

23. (D) WDCI, Fort Collins Milk Producers

Unify.. ............................. ..14

March/April1996 ........................... ..14

24. (L) Livestock Breeding Cooperatives (Atlantic

Breeders, Eastern AI, LABC) Merge ...... .14

25. (FV) Naturipe Acquires Florida Berries ...... .14

October 1995 ................................. 14

26. (D) Foremost Farms To Buy Morning Glory ... .14

September 1995 ............................... 14

27. (FV) Washington Apple Co-ops (Blue

Chelan, Trout) Merge ................. .14

May 1995 .................................... 14

28. (D) MM1 and Eastern Milk Approve Merger .. .14

29. (L) Dairylea Acquires Empire Livestock ...... .15

March 1995 .................................. 15

30. (D) Southern Milk Sales Merges with

Mid-Am ............................ ..15

February 1995 ................................ 15

31. (D) Coble Dairy To Merge with Mid-Am ..... .15

32. (S) Canadian, U.S. Co-ops (UCO,

GROWMARK) Join Forces ...............15

January 1995 ................................. 15

33. (F) .CoBank, Springfield Banks To

Consolidate ........................... .15

34. (L) Noba Joins CRY ....................... .15

December 1994 ............................... 15

35. (FV) Pro-Fat Completes Acquisition of

CurticeBurns ....................... ..15

November 1994 ............................... 15

36. (D) Mid-Am, DI Merger Receives Justice

Approval ........................... ..15

June 1994 .................................... 16

37. (D) Gulf Dairy To Merge with Mid-Am ...... .16

18
April 1994 ................................... 16

38. (G) Colorado Co-ops Join Forces .............16

February 1994 ................................ 16

39. (D) Prairie Farms, Allen Dairy Merge ........ .16

October 1993 ................................. 16

40. (FV) Wenoka Announces Merger .............16

February 1993 ................................ 16

41. (D) 21st Century Genetics, Wisconsin

DHIC Merge to Form CRP ...............16

May 1992 .................................... 16

42. (D) Dairymen’s Creamery Association Merges

with Darigold ......................... .16

43. (D) Mid-Am, A-G Cooperative Consolidate ... .16

February 1992 ................................ 16

44. (G) Twenty-two Riceland Co-ops Acquired ... .16

January 1992 ................................. 17

45. (D) Wisconsin Dairy Co-ops (Tri-State Milk,

Chaseburg Coop Creamery) Merge ...... .17

46. (FV) Fruita Buys United Fruit Growers ....... .17

September 1991 ............................... 17

47. (S) Indiana Farm Bureau, Countrymark

Merge* .............................. ..17

November 1990 ............................... 17

48. (D) Greenwood Co-op Joins LOL .............17

October 1990 ................................. 17

49. (S) Illinois Co-ops Form Gateway FS ......... .17

April 1990 ................................... 17

50. (FV) Welch’s Completes U.S. Grape Purchase . .17

January 1989 ................................. 17

51. (F) Jackson, Spokane Join National Bank for

Cooperatives .......................... .17

References

Business Wire, Inc., various news reportings, 1998.

Cobia, David W. Cooperatives in Agriculture, Prentice

Hall, New Jersey, 1989.

PR Newsletter Association, Inc., various news reportings, 1998.

Porter, Michael, E. Competitive Strategy, The Free Press,

A Division of Macmillan, Inc., New York, NY, 1980.

Various newspaper reportings, i.e., The Indianapolis

Star (IN), The Star Tribune (MN), The Kansas City

Star (MO), Grand Forks Herald (ND), The Bismark

Tribune (ND), The Pan tagraph (IL), The Sunday

Oklahoman (OK), The Daily Oklahoman (OK), The

Omaha World Herald (NE), The Arkansas Democrat

(AR), The Fresno Bee (CA), The Des Moines Register

(IA).

U.S. Department of Agriculture, Farmer Cooperatives,

Agricultural Cooperative Service, Washington, DC,

Vol. 55, No. 10, January 1989 - Vol. 61. No. 1 April

1994.

U.S. Department of Agriculture, Farmer Cooperatives,

Cooperative Services, Rural Development

Administration, Washington DC, Vol. 61, No. 2,

May 1994 - Vol. 61, No. 8, November 1994.

U.S. Department of Agriculture, Farmer Cooperatives,

Rural Business and Cooperative Development

Service, Washington, DC, Vol. 61, No. 9, December

1994 - Vol. 62, No. 6, September 1995.

U.S. Department of Agriculture, Farmer Cooperatives,

Rural Business and Cooperative Development

Service, Washington, DC, Vol. 62 No. 7, October

1995 - Vol. 62, No. 9, December 1995.

U.S. Department of Agriculture, Rural Cooperatives,

Rural Business - Cooperative Service, Washington,

DC, Vol. 63, No. 1, January/February 1996 - Vol.

65, No. 2, March/April 1998.

U.S. Department of Agriculture, Posifioning Farmer

Cooperatives for the Future, A Report to Congress,

Agricultural Cooperative Service, Washington, DC,

October, 1987.

Wadsworth, James J. Cooperative Restructing, 2989-2998,

RBS Service Report 57, Rural Business-Cooperative

Service, USDA, Washington, D.C., November, 1998

19
Appendix table I- Unifications shown in RBS cooperative list, 199%97*

1989 1990 1991 1992 1993 1994 1995 1996 1997 Total

Numbers

consolidations 55 41 76 74 58 47 65 54 41 511

Acquisitions 33 27 59 33 4 1 14 25 18 16 266

Total 88 68 135 107 99 61 90 72 57 777

Percentage of tota/

Merges and

consolidations 62.5 60.3 56.3 69.2 63.7 77.0 72.2 75.0 71.9 65.8

Acquisitions 37.5 39.7 43.7 30.8 36.3 23.0 27.8 25.0 28.1 34.2

’ The actual change may have occurred a year or more earlier. The year-to-year variation is partially due to the reporting mechanism.

20
U.S. Department of Agriculture

Rural Business-Cooperative Service

Stop 3250

Washington, D.C. 20250-3250

Rural Business-Cooperative Service (RBS) provides research,

management, and educational assistance to cooperatives to

strengthen the economic position of farmers and other rural

residents. It works directly with cooperative leaders and

Federal and State agencies to improve organization,

leadership, and operation of cooperatives and to give guidance

to further development.

The cooperative segment of RBS (1) helps farmers and other

rural residents develop cooperatives to obtain supplies and

services at lower cost and to get better prices for products they

sell; (2) advises rural residents on developing existing

resources through cooperative action to enhance rural living;

(3) helps cooperatives improve services and operating

efficiency; (4) informs members, directors, employees, and the

public on how cooperatives work and benefit their members

and their communities; and (5) encourages international

cooperative programs. RBS also publishes research and

educational materials and issues Rural Cooperatives magazine.

The U.S. Department of Agriculture (USDA) prohibits

discrimination in all its programs and activities on the basis of

race, color, national origin, gender, religion, age, disability,

political beliefs, sexual orientation, and marital or family

status. (Not all prohibited bases apply to all programs.)

Persons with disabilities who require alternative means for

communication of program information (braille, large print,

audiotape, etc.) should contact USDA’s TARGET Center at

(202) 720-2600 (voice and TDD).

To file a complaint of discrimination, write USDA, Director,

Office of Civil Rights, Room 326-W, Whitten Building, 14th and

Independence Avenue, SW, Washington, D.C. 20250-9410 or

call (202) 720-5964 (voice or TDD). USDA is an equal

opportunity provider and employer.