Co-ops Have Healthy Returns

Analysis of cooperative income from 2010 shows an increase across the board for the nation's top 100.

Published on: May 2, 2012

While the data is a year old, the analysis is newsworthy as USDA Rural Development releases its report on the nation's 100 largest 100 ag cooperatives. The top 100 recorded near-record revenue of $118 billion in 2010 - a 4% increase over 2009. Net income, according to the report released by Rural Development Under Secretary Dallas Tonsager, rose more than 10% in the same period, reach $2.39 billion, up from $2.16 billion in 2009.

In the statement announcing the new data, Tonsager notes that these farmer and rancher-owned cooperatives not only help members market and process their crops, milk and livestock; but they create jobs and help producer keep more of their earnings at home. "The end result is a huge benefit for producers, their communities and the overall rural economy. Farmer co-ops also account for significant numbers of jobs and economic activity in many cities."

Co-ops Have Healthy Returns
Co-ops Have Healthy Returns

Top earning cooperative in 2010 was CHS Inc. The farm supply, grain and foods cooperative, based in St. Paul, Minn., had revenue of $25.3 billion. Land O' Lakes, a dairy foods and farm supply co-op, also based in St. Paul, ranked second, with $11.1 billion in revenue. And in third, Dairy Farmers of America, based in Kansas City, Mo., with $9.8 billion in revenue.

USDA's top 100 ag co-op list shows that 23 co-ops had 2010 revenue of more than $1 billion. Another 47 co-ops had revenue between $506 million and $1 billion. The 100th ranked co-op had sales of $276 million.

Leading the revenue increase from 2009 to 2010 were dairy cooperatives, which saw 2010 revenue climb more than 14.5 percent from the previous year, to $29.5 billion. Dairy cooperatives accounted for more than half of the revenue increase recorded by the top 100 ag co-ops in 2010.

Gross margins, as a percent of total sales, were up slightly, from 9 percent to 9.2 percent. The increase in gross margins partially covered higher expenses. Gross margins plus service revenue climbed to $684 million.