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Meet a Closed Cooperative That Works
In the mid-1990s, as the Pork Powerhouses ranking of the largest U.S. pork producers was launching, a few independent family pork producers were working with Farmland Foods as part of that company’s pork advisory group.
In 2000, those families formed America’s Premium Pork, patterned after U.S. Premium Beef. The goal was to add value to their pigs beyond the farm gate through a fully vertical integrated model.
When Farmland Foods filed for bankruptcy in 2000, the producers involved in America’s Premium Pork tried to figure out how they could position themselves to buy Farmland out of bankruptcy.
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At a now infamous meeting in the basement of the Iowa Pork Producers Association headquarters, it became clear the Farmland asset buy wasn’t going to happen. But something more interesting did.
After that meeting, Bob Christensen, CEO of Christensen Farms, asked the America’s Premium Pork representatives if they wanted to join in a new venture called Triumph Foods. The goal was to build a new state-of-the-art pork packing and processing pork plant in the Midwest that was 100% owned by producers.
By 2003, Christensen, along with The Hanor Company, New Fashion Pork, Eichelberger Farms, TriOak Foods, and now Allied Producers’ Cooperative (the new name for America’s Premium Pork) had a site in St. Joseph, Missouri, picked out for the new Triumph Foods plant.
In 2006, the first Triumph Foods plant opened in St. Joe. A second new state-of-the-art plant, owned 50% by Seaboard Foods and 50% by Triumph Foods, opened last year in Sioux City, Iowa.
Making it work
Allied Producers’ Cooperative (APC), headquartered in Westside, Iowa, is admired in the pork industry for making the closed cooperative structure work for almost 20 years. Cooperatives are a great idea in concept, but difficult to execute and succeed in principal because farmers are inherently independent.
Tom Dittmer, 62, Eldridge, Iowa, has been a part of APC since the beginning and was at the basement meeting when Triumph Foods took root. Today he is president of APC and his family’s 5th generation farm, Grandview Farms, has 11,500 sows farrow to finish. We caught up with him for a few questions.
SF: What are the biggest concerns/challenges with APC producers today?
TD: The large supply of hogs working through the market in the 4th quarter of this year and into 2020 is concerning because we need to have the trade deals successfully completed so our prices can be at profitable levels.
SF: What value does Triumph Foods involvement bring to your members?
TD: Our involvement with Triumph Foods gives our members the opportunity to have our family pork farms be fully vertically integrated from production through marketing our pork. Triumph Foods gives us a known place in the pork business that provides us with secure opportunities and adds value to our farms’ financial base.
SF: What are the keys to your success?
TD: The biggest key to our success has been choosing members who have a like-minded vision. Then, we were fortunate at the very beginning to have Dave Kock be our general manager. He was very instrumental in working with our board of directors to surround our closed co-op with supportive and professional people who brought us tremendous value through all phases of our cooperative’s work during the 20 years we have been together.
Another important key to the success of APC is we have our members function as one owner, just like the other owners of Triumph Foods. All 32 of our members know this and work very hard to perform and deliver to meet and exceed the expectations APC has in being part of the Triumph Foods model.
SF: What can you tell us about your members?
TD: APC has 32 producer members who are mostly multi-generational family farms. Most are farrow-to-finish operations with a wide range of production sizes.
SF: What else can Successful Farming readers learn from your experience?
TD: Being a part owner of Triumph Foods did not just fall out of the sky. It took quite a bit of time, energy, and money to get to where we are today. The stars lined up for us. Triumph has been a great company with which to be aligned and we have been able to be surrounded with people that were determined to succeed. We knew the odds were against us, but that gave us more determination to succeed. From the very beginning, 20 years ago, we had a great leadership group that worked well together, and brought real talents to the effort to reach our common goal.
SF: Any last comments?
TD: When we became part of Triumph Foods, we learned to raise pork, not just pigs.