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Agricultural cooperatives can be broadly categorized into several types based on their functions and services:
- Marketing Cooperatives: These cooperatives assist farmers in processing, packaging and selling their products. By pooling the goods they produce, farmers can access larger markets and negotiate better prices. Examples include dairy cooperatives like Land O'Lakes and Cabot Creamery, fruit cooperatives like Ocean Spray and Sunkist Growers and nut cooperatives like Blue Diamond Growers.
- Supply Cooperatives: Supply cooperatives provide farmers with essential inputs such as seeds, fertilizers and equipment. By purchasing in bulk, these cooperatives can offer inputs at lower prices. An example is Southern States Cooperative, which supplies agricultural inputs to farmers in the Southeast. CHS Inc. is the largest cooperative business in the United States and supplies energy, crop nutrients, seed and crop protection products as part of its business.
- Service Cooperatives: These cooperatives offer various services to farmers, including transportation, storage and financial services. Cooperative banks and credit unions specifically serve the financial needs of farmers, providing loans and credit at favorable terms. The Farm Credit system functions as a service cooperative in this manner. Supply cooperatives like CHS and Growmark also offer marketing services for members, which places them under multiple categories.
Some popular consumer retailers like recreational goods provider REI and grocer Shoprite are also both cooperatives. For REI, members pay a one-time fee to join and receive benefits such as annual dividends based on their purchases, exclusive sales and access to outdoor events and classes. Individual Shoprite stores are owned and operated by independent retailer members. These member-owners benefit from collective purchasing power, shared resources and marketing efforts, which helps them compete with larger supermarket chains.
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