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The Cooperative Advantage

The United Nations General Assembly has proclaimed 2012 as the International Year of Cooperatives (IYC). In addition to PCCA, there are numerous cotton- related regional cooperatives throughout our trade territory in Texas, Oklahoma, Kansas and New Mexico that offer their members numerous services and products that lead to what we like to call “The Coop Family” and “The Coop Advantage.” These cooperatives have paid out almost $700 million in dividends into the rural communities they serve in the past 10 years. So, as we approach the International Year of Cooperatives, we are pleased to present a series of stories about cotton cooperatives in our four-state region in this issue of Commentator.

TACC LogoTexas Agricultural Cooperative Council

The Texas Agricultural Cooperative Council (TACC) began in 1934 and serves as a voluntary, statewide organization created by Texas cooperatives. It serves as a collective voice, catalyst and clearing house on all cooperative activities in the state of Texas.

TACC’s mission is to promote, support and advance the interest and understanding of agricultural, utility and credit cooperatives and their members through legislative and regulatory efforts, education, and public relations.

“Overall TACC is a voice for farmers and a trade association for all coops, and we will continue to work on legislative issues that concern these two groups,” explains Tom Engelke, TACC’s Executive Vice President.

FCC LogoFarmers Cooperative Compress

Centered in the heart of “Cotton Country”, the Farmers Cooperative Compress (FCC), with headquarters in Lubbock, Texas, has seen a rich history of innovation, leadership, and member loyalty throughout its 63 years of operation.

Since its creation in 1948, FCC has maintained its profitability and preserved its mission statement of providing efficient, reliable service to the cotton industry from day one. “FCC has a reputation of giving great service to the cotton industry, and that has added value to our producer-members,” said RonHarkey, FCC President and CEO.

“Farmers Cooperative Compress has been blessed with exceptional board leadership, a strong producer and gin base, great gin managers, and outstanding employees,” Harkey said. “As we look back on FCC’s history, it has been a great story, but we feel our best days are ahead of us.”

PYCO LogoPYCO Industries

Proudly celebrating its 75th anniversary this year, PYCO Industries is the largest cottonseed cooperative serving the southern United States. Providing high- quality service to more than 90 member gins, PYCO operates two cottonseed oil mills in Lubbock, Texas.

In order to add more value to its members’ cottonseed, the cooperative does not limit itself to simply producing cotton seed oil for cooking. PYCO Industries also markets whole cottonseed and the by-products of cottonseed processing, including cottonseed meal, cottonseed hulls and linters.

“As an effective and powerful competitive force in the oilseed business, PYCO Industries has exerted a significant influence on the prices all farmers received for their products and on services rendered by the industry,” Gail Kring, PYCO Industries President said. “This benefited all of the farmers in the area and, through them, the hundreds of communities that depend on their welfare and prosperity.”

VALCO LogoValley Cooperative Oil Mill

Valley Cooperative Oil Mill (VALCO) serves a larger geographic region than any other Texas oil mill. Headquartered in Harlingen, Texas, VALCO’s 19 member-gins bring in cottonseed from producers scattered around the Houston, Texas, area to the bottom tip of the Lone Star state.

Although cottonseed oil remains the cooperative’s most valuable product, VALCO also processes and sells cottonseed meal, cottonseed hulls, linters, and whole cottonseed. VALCO also began supplying agricultural chemicals to its members in 1962 to provide a reliable supply of quality products, and in 1996, the cooperative completed the construction of a bulk fertilizer storage facility at the Port of Harlingen. Four years ago, as visionary board members believed the process would offer cotton producers an additional profit opportunity when the market was right, VALCO became the first mill with a plant capable of converting cottonseed into bio-diesel.

As Agriculture Secretary Vilsack recently indicated, never underestimate the American farmer. And if I may add to that: never underestimate what our farmer and utility coops are capable of when the power of one is multiplied by the many.Dallas Tonsager, Under Secretary for USDA Rural Development

“I don’t think you can get more coop minded than I am,” said Don Ocker, a farmer who gins his cotton at Gulf Coast Coop, markets his cotton though PCCA, and serves as a VALCO Board Member. “I feel like I get the most money and the best treatment from the cooperatives I do business with, and I never have to worry about them being able to fulfill their obligations or my expectations,” he added.

PCOM LogoProducers Cooperative Oil Mill

Headquartered in Oklahoma City, Oklahoma, Producers Cooperative Oil Mill (PCOM) has manufactured high quality cottonseed products since 1944. With additional locations in Kennett, Missouri; Osceola, Arkansas; and Covington, Tennessee, PCOM is a recognized leader in the industry, selling cottonseed oil, meal, hulls, linters, and whole cottonseed nationwide.

“PCOM allows us, as farmers, to benefit financially from the biofuel, cooking oil, and protein markets by selling the byproducts of our cottonseed,” explained Steven Clay, a cotton producer and PCOM Board Member from Carnegie, Oklahoma. “Probably the largest benefit of PCOM is the consistency the coop provides in the cottonseed market. From year to year there are no guaranteed sales to other industries, like dairies for instance, but PCOM is always there to buy cottonseed from its member gins,” he said.

The cooperative allows individuals to pool resources to reach economies of size that would not be achievable otherwise. This economic advantage is multiplied in the Southern Plains where cotton producers have access to inputs, ginning, warehousing, cottonseed crushing, marketing, and credit through cooperative entities that they own.Ed Smith, Director
Texas AgriLife Extension Service

Gulf Compress LogoGulf Compress

Strong leadership and growth have contributed to the success of a South Texas cooperative warehouse association which, for more than 60 years, has strived to maintain great customer care and quality performance.

A group of cooperative gins formed Gulf Compress in 1950 to serve the southern region of Texas with the primary goal of providing dependable storage and service for cotton producers. Currently, Gulf Compress has a combined total capacity for about 625,000 bales.

“Our board has been blessed to have a management team that works to keep our customers supplied with clean, dependable, and timely deliveries that add value to their growers and member gins,” said Chairman Sam Simmons.

FCEC LogoFarmers Cooperative of El Campo

Along the Texas Gulf Coast, about 90 miles southwest of Houston, is a cooperative that was created to better serve the farmer-members of the area’s agricultural community. For almost three decades, Farmers Cooperative of El Campo (FCEC) has been serving Texas farmers with efficient cooperative services, warehouse availability, and even a general store.

FCEC has three warehouses which have a total bale capacity of 30,955. The cooperative also owns two cotton gins to better serve its cotton producers as well as three elevator locations for its grain producers.

“When we established our warehouse division, our goal was to receive our members’ cotton on a daily basis and never be late shipping a load of cotton,” Jimmy Roppolo, Farmers Cooperative of El Campo General Manager said. “To this date we have accomplished just that.”

Triangle LogoTriangle Insurance

Triangle Cooperative Service Company (TCSC) was founded in 1916 by 20 Oklahoma farmerowned cooperatives. Today, TCSC has more than 385 member-cooperatives in a nine state area. Headquartered in Enid, Okla., Triangle adds value to its members in many ways with the services and programs offered.

“Triangle’s mission has always been and will continue to be to provide a stable insurance market for our cooperative member/owners,” said John Berg, TCSC President and CEO.

By fostering democratically governed business structures, cooperatives contribute to their members’ financial bottom line and their social well being. In addition, cooperatives promote their communities’ collective energy and enhance society’s civility. This is the Cooperative Advantage.Michael L. Cook, Graduate Institute of Cooperative Leadership (GICL) Board of Trustee member and University of Missouri Professor of Cooperative Leadership

TCG LogoTaylor Compress

A cotton warehouse located in Taylor, Texas, carries a unique story of transforming from a cotton marketing cooperative to a cotton compress and warehouse over a span of 70 years.

Today, Taylor Compress is a producer-based cooperative, and its current 266 producer-members own the facility debt-free and participate in all of the earnings the warehouse generates.

General Manager Bob Snodgrass has been with Taylor Compress for 20 years and continues to set future goals that will benefit the cooperative plan.

“In the future, my hope for the compress is that it continues to be a producer-owned warehouse that provides our members with a local facility to store their cotton and the benefits associated with such ownership,” Snodgrass said.

Snodgrass feels the cooperation between Taylor Compress and Plains Cotton Cooperative Association’s (PCCA) Marketing Division, which began in 1996, was a new opportunity for its members which has proven to be beneficial both to the operation of Taylor Compress and its members.

“I think farmers have always benefited from the availability of crop production support provided by various state agencies or commercial firms,” Snodgrass said. “Similarly, PCCA provides farmers with much needed marketing support and assistance through its pool and other marketing options.”

  • The United Nations General Assembly Resolution 64/136 proclaims the year 2012 as the International Year of Cooperatives (IYC).
  • The theme is “Cooperative Enterprises Build a Better World.”
  • Worldwide, more than 800 million people are members of cooperatives.
  • More than 29,000 cooperatives operate in every sector of the U.S. economy and in every congressional district; Americans hold more than 350 million coop memberships.
  • U.S. cooperatives generate two million jobs and make a substantial contribution to the U.S. economy with annual sales of $652 billion and possessing assets of $3 trillion.
  • The majority of our country’s two million farmers are members of the nearly 3,000 farmer-owned cooperatives. They provide more than 250,000 jobs and annual wages of more than $8 billion.
  • More than 900 rural electric coops deliver electricity to more than 42 million people in 47 states. This makes up 42 percent of the nation’s electric distribution lines and covers 75 percent of our country’s land mass.
  • About 1.2 million rural Americans in 31 states are served by the 260 telephone cooperatives.