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5 things you didn’t know about co-ops

NCB reveals the top 100 co-ops in the United States.

For the last 31 years, the National Cooperative Bank (NCB) has published the annual Co-op 100 List, a ranking of the largest co-ops in the United States. Agricultural co-ops, owned by customer members to give them more clout in both buying and selling products, dominate the list. Here are five takeaways from the new top co-op ranking, based on 2020 revenues.

1. Agriculture’s dominance

About half of the 100 largest co-ops in the U.S. are directly in agriculture – buying, processing, and marketing crops and livestock and providing inputs. CHS (Cenex-Harvest States) has been on the top perch for many years, and is still there this year with $28.4 billion in revenue. That revenue is down from the previous year due to lower commodity prices in 2020, but still nearly twice as big as CHS’s closest co-op competitor.

At the other end of the list is the National Grape Cooperative at No. 97 and $596 million in revenue. It is a co-op of over 1,000 grape growers who grow for Welch Foods.

In between are many other common co-op names familiar to farmers; GROWMARK (8), MFA (34), Southern States Co-op (43), and Farmers Cooperative (63). Regional co-ops like Plains Cotton Co-Op (31) in Texas and New Cooperative (42) in Iowa make the list, too.

The farm cooperative dominance has held pretty steady over the history of the report, says Barry Silver, a former NCB executive who has been the point person behind this list since its inception.

2. The big 3 of ag co-ops

CHS has been the biggest co-op in the country since the 1998 merger of Cenex and Harvest States. Headquartered in Minnesota, it buys grain from farmers, processes it, and sells it on domestic and world markets. It also sells inputs to thousands of farmers through local outlets.
CHS is nearly twice as big, revenue-wise, as No. 2 and No. 3 on the co-op list – Dairy Farmers of America, and Land O’Lakes. DFA, based in Kansas City, is a co-op of 12,500 family dairy farm owners that buys milk, processes it, and sells it under such household brand names as Bordens, Kemps, and Meadow Gold.

Land O’Lakes is the 100-year-old cooperative based in Saint Paul, Minnesota, that is big in dairy products sold under its own brand. It also sells many farm supplies and livestock feeds to farmers, and since 2001 has owned the Purina brand of animal feeds. In 2016, it joined United Suppliers to form a business unit called WinField United to serve local agricultural retailers with seed, chemicals, and farm services.

3. If it’s not directly ag, it’s probably still rural or food

Included on the Co-op 100 List are 22 energy cooperatives, most in rural areas. They are primarily the rural electric cooperatives that trace their roots to the 1930s and 1940s rural electrification movement. The largest of these is Basin Electric Power Co-op (20), based in North Dakota, which generates and distributes power to clients across the upper Great Plains states. Other energy co-ops include Oglethorpe Power (34) in Georgia, and Arkansas Electric Cooperative (80).

Food and grocery companies also have prominence on the Co-op 100 List. They usually serve independent grocery stores by region of the country. The largest grocery co-op is ShopRite, No. 4 on the list with $12 billion in annual revenue. It serves independent grocery stores in the northeastern part of the U.S. and claims to be the largest grocery retailer in the New York City metropolitan area. 

Another grocery co-op, Associated Wholesale Grocers (5), is owned by and serves 3,000 retail grocery locations across the middle section of the country. Piggly Wiggly (74) also operates as a grocery co-op.

Says Silver, “There used to be 50 grocery co-ops, but mergers and buyouts have reduced that number to about eight now. They’ve had to stay competitive with giant grocery retailers like Walmart. The ones left are some really strong co-ops.”

4. Surprise! Credit unions are co-ops

Many people don’t realize this, says Silver, but most credit unions are organized as co-ops and owned by their member customers. They are growing in size; 126 million Americans now belong to a credit union and four new credit unions made the Co-op 100 List for the first time this year. 
The biggest credit union co-op is the Navy Federal Credit Union (No. 6), based in Virginia and an $8.3 billion financial institution. It was started during the Great Depression by a few Navy veterans who wanted access to credit. It’s been expanded to include members from all branches of the military, veterans, defense department employees, and family members.

A few of the financial institutions on the Co-op 100 List are closely connected to agriculture as part of the Farm Credit Service. Owned by their customer members, they provide land and operating loans to farmers and ranchers, in some cases regionally. CoBank, based in Colorado and No. 11 on the list, is the largest of these. Others include AgriBank based in St. Paul, Minnesota (16), FCS of America from Omaha, Nebraska (29), and FCS of Mid-America based in Louisville, Kentucky (48).

The National Cooperative Bank, which compiles the Co-op 100 List, is also a cooperative financial institution that serves co-ops nationwide, but is not large enough itself to make this list. It also doesn’t lend to agricultural co-ops or farmers. “NCB’s primary focus is housing and commercial co-ops such as grocery, where a bank like CoBank would not finance,” Silver says.

5. And a few odd co-ops

There are a handful of other non-agriculture members of the Co-op 100 List that you will recognize, but may have realized were co-ops. For instance, Ace Hardware, No. 7 on the list, is owned and operated by 5,000 local Ace stores. The co-op approach gives them some purchasing and marketing power to compete with the big-box stores. Do-It-Best hardware, No. 12 and headquartered in Fort Wayne, Indiana, is also a co-op.

REI, an outdoor apparel and equipment co-op and No. 14 on the list with nearly $3 billion in annual sales, is the largest consumer-owned co-op in the country. Members who shop there can earn a patronage dividend at the end of the year based on their spending, just like farmers do at a farm co-op.

One of the goals of the Co-op 100 List, says Silver, is simply education. “A lot of people, even farmers who may serve on their local co-op boards, don’t realize the breadth of the co-op movement,” he says. 

“I’m a true believer in the co-op approach,” adds Silver, who in retirement now still does the research and compiles the Co-op 100 List for NCB. “Co-ops offer services cheaper than elsewhere, and well-serve their members. I really believe in that model of shared ownership, and I always hope that publishing this list helps spread that positive message.”

What is a co-op?

A cooperative is a business organized, owned, and controlled by the people who use its products and services. Co-ops operate for the benefit of their member-owners. Profits are usually re-invested in the business, or returned to members as patronage dividends. One in three Americans is a member of a co-op. Co-ops take advantage of economies of scale, combined buying power, and strength in numbers to save money. They provide millions of jobs, support other businesses and personal needs, and enhance quality of life.  

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