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| Yes Ray, under ordinary circumstances, you might expect Coop's response to the influx of grain (by their members) to widen the basis in order to slow down the influx but remember, at the same time the end users aren't going to be able to easily turn to non-coop suppliers as they won't have any grain. Coop's are going to be sitting in the catbird's seat. And more to the point, since the owners of the Coop's are the producers themselves, they will presumably get the extra profits that might go to the Coop's. And in addition, since the producer-members get to collect either way, it actually might be more advantageous for the Coop's to narrow their basis as much as possible to maximize the gross revenue number and thereby maximize the 20% deduction.
And then there is the real possibility that the end user themselves might try for a piece of the action by paying less. | |
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199A Coop deduction provision.
