Agricultural group underlines crucial role of dairy co-operatives

'Dairy cooperatives offer unique economic benefits to their farmer members'
'Dairy cooperatives offer unique economic benefits to their farmer members'

Faced with low dairy prices and rising volatility on agricultural markets, Cogeca President Thomas Magnusson underlined the crucial role of dairy cooperatives.

They enable farmers to get a better price for their milk and the need to encourage their development at a Cogeca Presidency Business Forum on Dairy Cooperatives today.

Speaking at the event in Brussels, Mr Magnusson said: "We are facing a serious crisis on the EU dairy market, with prices more than 40% down on levels seen two years ago and volatility increasing.

"It is consequently essential to encourage the development of dairy cooperatives as they help farmers to secure a better price for their produce and reduce the price volatility.

This was confirmed by a recent study carried out by the EU Commission which found that: "A large market share for cooperatives in a particular sector or country, can increase the price level and reduce the price volatility, as is currently the case in the dairy sector."

He continued: "Dairy cooperatives offer unique economic benefits to their farmer members, as they provide market outlets, more competitive buying prices and secure revenues, as well as more favorable long term perspectives.

"The examples presented today, demonstrate that cooperative governance is key to dairy cooperatives.

'Well developed' governance structures

"Even the largest international and transnational dairy cooperatives, have well developed governance structures, which ensure that their farmer members are heard and that they maintain control on decisions affecting their transactions."

"With dairy demand expected to grow by 2% annually on a global level, the sector needs to be competitive to make use of the market opportunities and cooperatives enable farmers to do this.

"There are significant entrepreneurial opportunities for dairy-cooperatives in some growing market segments in the EU, as well as on the global market.

"In addition, there is scope to further invest in innovative solutions, including actions to improve resource efficiency.

"More transnational cooperation within the EU, as well as beyond, could also take place," Magnusson added.

Wrapping up, MrMagnusson said: "Today’s event highlighted the importance of dairy cooperatives and how their strategies contribute to responding to current challenges, in defense of farmers interests."

Prof Cees Veerman, head of the EU Agricultural Markets Taskforce and former Vice President of Cogeca, also under lined the importance of cooperatives at the Business Forum.

A key aim of the Task Force, which is set to deliver its report by the end of the year, will be to strengthen farmers positioning in the food chain by encouraging the development of cooperatives as they help farmers to join forces and better market their produce.