Cooperative Farming | Farming Together

 As we are coming across various news regarding suicides of farmers, which is alarming threat to the country food security. As we need food at highest priority which is basic need for survival of individual, As farmers do not want to go for farming due to, low income through farming practices, which will result in food insecurity in country.  

The solution is cooperative farming which we want to convert into Corporate Farming in near future; cooperative farming will give wings to farmers as well as will save country from food insecurity threat.

Hence we began this research motivated by a desire to farm with peers – to work together in managing land, sharing costs and equipment, and generally making our lives easier. Throughout this process I’ve found that desire echoed countless times, in many variations, by farmers across the country. It’s clear that we face common challenges. It’s also clear that by working together, we get more than just a solution to a problem: we get solidarity.

There is no one model for “cooperative farming.” We can form separate businesses or one business. We can share land, or farm as neighbors, or farm together in a community or a region.

We need a whole range of models and solutions for working together. We are learning to design our own tools and methods to match our scale and soil. In the same way, we need the knowledge to design our own business structures and agreements, to fit our unique circumstances of person and place.

 What is a cooperative?

The word “cooperative” has two meanings: both a type of business and an attitude that can be broadly applied. A cooperative is a specific type of business that is formed expressly to provide benefit to its members, such as:    

• A producer co-op that is created to provide cost savings and or marketing services to a group of  producers.  
• A worker cooperative created to provide stable, fair employment for its workers.

A cooperative business is defined by three major standards:  

•   It is owned by its members, those participating in the business, not by outside shareholders or investors.
•   It is governed by its members. Each member of the business has a vote in major business decisions and in electing representatives or officers.  
• It exists for member benefit, not profit for outside shareholders. Any profits are distributed equitably among members.

What Is “Cooperative Farming”?

Cooperative farming is creating shared farming ventures to address common challenges and provide mutual benefit. By cooperative farming we utilize resources like land, labor, farm equipment etc. collectively. Buying a seed drill with neighboring farms, sharing a delivery van to a nearby city, or even running a farm together need not be classified or operated as a cooperative in order to provide fair and mutual benefit to those involved. Cooperative farming explores a variety of frameworks to work together as a group. Here, we focus on the agreements and processes that make collaboration function.                                                                                      

Need For Cooperatives

As most of the families in our country are fragmenting generation by generation this is resulting in reduction of size of land for particular farmer. As a result of this effect farmers are getting raw materials at higher costs, as they buy small amount of material.                                                                                                             Small land size results in lowering profits through selling crops and higher price of raw materials like pesticides etc. , which in short increasing the burden on small farmers.

This can be better understood by following terminologies.

Economy of Scale: Cooperation will allows little farms to do what big farms are doing, like they can buy inputs (raw materials) at bulk rates, increase volume to open new markets, and lower the per-use cost of equipment. Together, producers can lower cost, access needed services or facilities, or generate more income.

People Power: Allied producers will be able to negotiate for better prices with the buyers, diffuse risk, and share knowledge for production, skills, and labor.

Access to Capital: Farmers can pool capital to invest in a shared business from investing agencies, tool or asset, and can increase their borrowing power with combined collateral and experience of their members and partners.

Quality of Life: Allied farmers can arrange for time for vacations, child care, or extra hands when needed during peak time. They can share responsibilities, whether in selling produced crops, producing crops, or maintaining shared resources for farming, means a lighter load for overworked operators for farming.

Continuity: Group entities can serve as long standing vehicles to transition land, resources, and businesses among producers. Operating under a primary entity, an individual farmer has more flexibility to retire or relocate and transition use to the next farmer.

By practicing cooperative farming we can provide employment to the land less people within our area which will again result in employment to the poor people. Hence farmers as well as people without land in villages will be benefited.

The Cooperative Farming Landscape

This report on cooperative farming addresses two main categories that can be used for working together. In the first category, several separate farming practices share access to resources and services, like marketing practices, equipment houses, and labor. In the second category, individuals will be working together to form one farm operation which will include multiple owners, such as a worker cooperative and farm cooperatives.

Cooperative farming landscape is defined in a strategic manner; it is designed to minimize the cost as much as possible. It includes community tool sheds, buying clubs, etc. These all department works in collaborations with each other’s.             

1-Sharing resources and services

• Marketing & Distribution Sharing

Cooperative demonstrates how commodity producers have succeeded in the marketplace by banding together to process, market and distribute their goods. Small and large farms alike can combine efforts to overcome barriers of scale, means, skill, time, language or culture. Marketing is a fairly specialized skill set that can be a huge relief to a producer to be able to outsource. Other benefits of shared marketing include:

• Sharing of distribution costs lowers the costs for each producer.
• Several producers can reach a sufficient sales volume to hire qualified salespeople.
• Allied sellers can negotiate more stable prices and consistent sales.
• Increased product volume, consistency, and reach can open new market outlets.
• Strong shared brand can bring marketing advantages.
• Cooperative value adding, like washing or processing, can bring higher prices.

 Marketing Cooperatives are businesses owned by the producers that use the business to sell their goods. The cooperative operates at cost, and distributes any surplus profits back to the members in proportion to the money value they’ve sold through the co-operative.

 Multi-Farm CSAs can be groups of similar producers (i.e., vegetable farmers) that pool and distribute their products to a broader customer base, or groups of farms with entirely different products, seeking to provide consumers with many of their food needs. Some multi-farm

CSAs are structured as cooperatives, such as Local Harvest in New Hampshire, a group of 8 growers producing vegetables for a 260 member CSA.

A hired crop coordinator works with the growers, who bid and contract for the crops they’d like to provide. The growers are paid for their produce on arrival, minus a 20% commission to cover their operating expenses. Thanks to SARE funding, Local Harvest has put together Local Harvest: A Multi-Farm CSA Handbook laying out the details on bidding, incorporating, administration and more.

Joint Sales Agreements can be created between two or more businesses to sell or market products for one another. An example would be vegetable farm that wants to diversify its offerings by selling meat and eggs from another farm. The parties would write a contract stating the terms of the agreement, such as if there’s a fee or percentage taken by the host farm or seller, and the length of time the agreement will last.

Co-packing and processing involve some value-adding, such as washing, freezing, canning, drying, and or cooking. These processes can be done on a small scale, or members can invest in the equipment and infrastructure to process significant quantities of produce efficiently. Grange Co-Packers, a start-up cooperative in Essex, NY, has made this work by lobbying for their local grange hall to install a commercial kitchen with needed equipment like a flash freezer and steam kettle, to which they lease access.

The desired price point, volume, and type of product can help determine the sales strategy. Many large-volume venues like schools and hospitals need products in standardized quality and packs. Producers looking to sell to these accounts would need to focus on crops that can be grown in sufficient quantity, quality and packaging. Direct to consumer sales like multi-farm CSAs or shared market stands can bring in higher prices, be more flexible on volume, and allow for greater diversity; however, they also require more time in outreach, customer support and distribution. The direct-to-consumer distributors we spoke to needed 20-30% of the sales value to cover their administration, staff, and facilities costs.

• Equipment Sharing

Sharing equipment can be organized through a variety of ownership structures and financial arrangements, from handshake deal among neighbours to setting up an equipment-sharing cooperative.

Organizing as a separate legal entity has liability protection advantages and can provide a better structure for investing in or replacing equipment.                           A separate legal entity can build up capital to hold for future purchases or expenses. Regardless of the form (informal agreement, contract or legal entity), farmers sharing equipment should write down their agreement and include:

• Each member’s capital contribution and ownership
• How expenses will be allocated (hourly, by acreage, or unit)
• How depreciation will be calculated
• Operating policies on scheduling and safe operations
• Procedures for housing and maintaining the equipment
• Entry and exit: how members can transfer ownership

Community Tool Shed                                                                                               It is shed where all the shared tools and farm equipment will be stored to a common place and tools and equipment can be used by members according to scheduled timing. It contains equipment like seed drill, tractors, harvester etc. It is owned by its members by sharing money according to their land size.

Scheduling use: Scheduling is generally the first concern for producers considering shared equipment: “What if I can’t use it when I need it?” By and large, the response from most farmers sharing machines is that because joint purchasing enables access to larger equipment, or equipment that would otherwise be unavailable, the time savings outweigh the hassle of scheduling in advance. For nearby farmers, a Google calendar and 24 hours advance signup may be enough. Seasonal equipment like hay balers and combines are often scheduled at the beginning of the year. They can be rotated in order of proximity between different farms, starting with a different farm each year.

 Sharing Costs: Producers can divide the initial investment cost equally among them or in proportion to projected use. Ongoing costs include depreciation, insurance, housing, maintenance, and repair, and are usually divided by hourly use, acreage, or units. “Estimating Farm Machinery Costs” is great tool for those just starting out.

 Operating and Maintaining Equipment: Co-owners should set policies on what constitutes misuse, what repairs need to be paid for by the individual, and how the equipment should be returned. A logbook or other record should be kept for each piece of equipment noting usage, needed repairs, and maintenance performed. The group can assign and compensate one member to perform maintenance, or divide responsibility of various machines between the members.

• Labour Sharing

This allows member farms to share the cost and administrative burden of hiring workers, especially for those farms that only need part-time help, and provides more stable work and more hours to the employees. Participating members commit to hiring workers for a certain number of weeks per year.

 Benefits of Labour Sharing:  

• Centralized vetting and hiring of employees brings in a wider pool of applicants and improves the hiring options for each farm.
• Farms can gain access to a stable supply of trained labor
• Farms can share the responsibility of housing, transporting, and training workers
• Labor regulations and paperwork can be handled at the cooperative level
• Allows more flexibility in sharing part-time and “spot” labor
• Larger pool of employers offers more stable work to the workers

 Farmer and Worker Agreements: There should be clear agreements on what the authority, expectations and responsibilities are for workers, host farms, and the coordinating organization, including policies for maintaining worker safety and instruction. Having farms commit to hiring workers for a certain number of hours each week or season is important to supporting the finances of both workers and coordinating group. If two or more farms are sharing a part-time worker, there should be clear agreements about the scheduling process – how farms book workers in advance and whether or not they are committed to hiring them if the weather proves unworkable.

•   Service and Supply Sharing

Storage, custom hire work, and technical support services can all be shared among farms in the framework of shared service cooperatives. Beyond agriculture-specific services, service cooperatives can be set up to share:

• Purchasing of health insurance or childcare services
• Education services, such as hiring consultants or hosting trainings
• Machine repair, renting shop space and hiring repairmen
• Lending or financial support, such as Farm Credit, Co-Bank, credit unions or revolving loan programs like the Carrot Project.

These types of collaboration can suit a broad audience, including those skeptical of collaboration. In general, groups would benefit from bringing in as many members as possible, to increase the group’s buying power and lower costs. Some buying clubs rely entirely on volunteer labor with great success, and others find that most members use the service as they would any other shopping experience (low participation in the direction and maintenance of the business). The amount of work members are willing to do may hinge in part on how much the good or service is needed. Understanding consumer “buy-in” is important to planning the staff needs and including those expectations in your feasibility study. After preliminary planning, running a pilot program and gathering feedback is a great first step.

2. Land Sharing

As size of land for single individual is fragmenting generation by generation within a family, this is resulting in small land sizes for single individual. Hence if we cultivate small land size that will increase average cost of cultivation, resulting into low profits and burden on farmers.  

To overcome this situation we can share land and cultivate it in a group, and can reduce the burden and cost of cultivation.                                                                     Below is example how different lands can be shared to form a single big farm land.

As we saw in above situation that how small lands can be converted into big farm land, this will reduce the burden of high equipment cost, as cost will be shared with every member. Cost of cultivation will similarly decrease and this will result in increase in profits.

 Conclusion

As in everyday newspaper we read, most of the farmers are doing suicide as they are not able to earn profits from their lands. In most of the cases small farmers are in this category, whereas big farmers are earning profits. The reason behind this situation is size of land which is fragmenting generation by generation, due to small land size the average income decreases as we have to buy costly equipment for small land which becomes the another burden on the small farmer.

As number of small farmers is increasing day by day and which is becoming a burden on farmers as well as government is also facing subsidies burden due to it. To overcome all these problems we should start cooperative farms in our country which will result into the good profits for farmers and will reduce the excess burden on farmers and government.

To start with cooperatives at different villages we should start a campaign to educate farmers regarding the cooperative farming, although this is practiced at many places within the country but our vision is to establish it at mass level so that farmers across the whole country can be benefited by it.

By passing of time when these kinds of cooperatives with establish in full fledge; it will be beneficial for farmers as well as the other people also within the country. Many labor class people will also get employment as they will be engaged in farm activities with farmers to support them.

In future cooperative farms can also be converted into corporate farms; where farmers can earn more profits by processing crops into desired goods to earn more profits which will further increase the profits to framers.