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How is the French agricultural cooperative model managing to weather the international crisis?

Scientists in the Contract-based Unit for the Governance of Cooperatives, Territories, the Environment and Markets (GAIA SAD) in Bordeaux, and the Joint Research Unit for Agrosystems and Territorial Development (AGIR) in Toulouse, have been studying how cooperatives, whatever their sector, are managing to weather the current crisis and continue to compete internationally.

Silos de l'unité de  STOCKAGE  de la SCAEL (Société Coopérative Agricole d' EURE ET LOIR ) de Marchezais (28). © BOSSENNEC Jean-Marie

Industrial innovation economics research tools were used to investigate how the status of French cooperatives, first defined in the French law of 10 September 1947, has enabled cooperatives to combine the upholding of their traditional values of solidarity, transparency and democracy with becoming competitive players in international markets.  The task of cooperatives is to provide collection, processing and distribution services for their owner-members, and to offer them the best possible level of remuneration.

Involving three farmers out of four, and representing some 40% of agri-food companies, cooperatives are enterprises that play a structural role in both local areas and throughout the supply chain.  Their local roots allow them to help preserve rural employment and to improve upstream structures by enhancing the value of local products.  And small-sized cooperatives also play a role in ensuring the traceability, security and quality of their products, by indicating the origin of their products (two out of three cooperatives benefit from an official quality label) and/or having their own brand (one out of four).  Equally, their strong investment in the downstream value chain allows them to reconcile production and consumption.

Thanks to the advisory services they provide, agricultural cooperatives play a key role in responding to the agronomic, economic and strategic needs of their members.  The experimental skills they have acquired enable them to participate actively in encouraging the adoption of good practices and in developing more environmentally-friendly farming.

Despite their strong roots in different regions, cooperatives have nonetheless managed to remain competitive.  In fact, since the 1960, an overall decline in their numbers has gone hand in hand with their increased concentration through mergers and acquisitions, and growth in their earnings.  Today, these cooperatives and their subsidiaries constitute complex groups whose sphere of influence can be measured using the “cooperative perimeter” concept.  This includes all enterprises with cooperative statutes and those controlled jointly or severally.  These groups, which pursue the objective of attaining critical size, do so by developing strategic alliances that allow them to reduce their costs, acquire new skills and affirm their leadership of a sector.

Another approach involves innovation, the diversification of their activities by increasing the number of “product”' sectors and the creation of new sources of added value.  Examples include investment in biofuels, or the Tereos group, a leader in sugar-beet processing, which invests in sugar cane processing in Réunion, Mozambique and Brazil.  Cooperatives also use market management tools to try and regulate the volatility of agricultural prices.
As for their strategic orientation, their particular mode of governance confirms their democratic ambitions: to reconcile economic development with the preservation of agriculture at the service of their owner-members.

Scientific contact(s):

  • Maryline FILIPPI Contract-based Unit for the Governance of Cooperatives, Territories, the Environment and Markets (GAIA)
Associated Division(s):
Science for Action and Development
Associated Centre(s):

Find out more

  • Filippi M., 2012, Support for Farmers’ Cooperatives; Country Report France. Wageningen: Wageningen UR, 61p.