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Corn+Soybean Digest

Alliances Offer Clout

In the livestock sector, especially the beef industry, the term "alliance" has been a buzzword for about five years. It seems it's now becoming one in the crop sector, too.

Alliances are simply ways for producers to join together to more profitably raise and market their products.

For those in the cattle business, alliances have sprung up that combine the calf-raising expertise of ranchers with the finishing efficiencies of feeders. Together, they build a stronger marketing force to sell beef. They're producing exactly what packers want.

With crops, start-up groups like Minnesota's FarmConnect are building yet another generation of alliances to capitalize on adding value by matching production to market needs. FarmConnect's farmer-based network is trying to connect you, for example, to companies like General Mills, which requires a specific grain quality to produce cereals like Cheerios.

Hopefully, that means more money in your pocket, says Zach Fore, a cropping systems specialist at the University of Minnesota.

Other co-op groups, like Producers Alliance in Bloomington, IL, are currently in the building phase, too. So far, says Bruce Johnson, the group's marketing manager, they've enrolled over 200 members from 45 Illinois counties and nearby states to explore value-added ventures.

"We're looking at ventures like specialty grain contracts, livestock initiatives and adding value through processing opportunities," Johnson says. He points to the successes of other farmer co-ops like South Dakota Soybean Processors, Golden Oval Eggs and Dakota Growers Pasta Co., which are all providing added value and getting paid for it.

Still others, like AgraMarke, Inc., in northeastern Kansas, are capitalizing on added value from identity-preserved crops. The three-year-old group has about 150 farmer-members and over 200,000 acres of corn and soybeans involved.

"The springboard for us happened when a local elevator came up for sale - and 21 farmers here bought it," says Bill Becker, the co-op's director of marketing.

Kudos to all these risk-takers pressing to make more cash than they are from their commodity crops. We hope they, and others like them, find success.

As Fore puts it: "It's time to get on the moving sidewalk. Think product markets, not commodity markets."

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