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ECIL | To compare your local co-op to Bunge, Cargill, ADM, etc is not an apples to apples comparison. Bunge, etc are end users and can bid whatever they want, wherever they want. It doesn't have to make sense. They can bid high where there is a lot of competition and bid really low where they have no competition to make up for it. They also have the advantage of not having to deal with a middleman. I'm not aware of your particular co-op (I'm sure there are bad actors some places) and their philosophy regarding what being a co-op means, but I can say that the co-ops I've been involved with and been on the boards of aren't cutting the fat hog. It's a tight business, you're constantly needing to upgrade, repair, and replace equipment and that's not a cheap endeavor. We always are wanting to dump fast as farmers, so dumping slow and being the harvest bottleneck for farmers isn't an option either. The complaint will be one of the two "you aren't bidding enough" or "my trucks can't sit in line that long". It's a struggle to give both/and to the customer/owners of your company when you aren't the end user.
If you don't like the local co-op's bids I would build your own bins to cut out the "middleman". If you have the capital, labor, and management required to do so go for it. I probably shouldn't say this as a board member, but for guys that want the "best" of all worlds, this is the direction you'll have to head.
All this to say, don't run the co-op's bids in the dirt until you know the full story or have walked a mile in their shoes and understand what the grain business is like apart from the end user's world. | |
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Why do coops have such bad basis?
