Potato cooperative
Farmers' cooperative are given special license under US antitrust to work together to process and market their products, something other businesses are not allowed to do The 1922 the Capper-Volstead Act allowed farmers, unlike other competitors to share pricing data and to manage supplies. It is a way or framers to counter the oligopsony powers of the buyers f agricultural products.
A recent Wall Street Journal article ('This Spud's Not for You", 9/26/06) documents United Potato Growers of America, a growing national cooperative for US and Canadian farmers. They are trying, as the article puts it, "to be to potatoes what OPEC is to oil by carefully managing supply to keep demand high and constant, resulting in a more stable return for farmers."
To that end, the group is working with members to destroy potatoes, "6.8 million hundred-pound potato sacks" last year. The lowering of supply has helped potato price surge by over 45% since last year. (however, as the article has pointed out, supermarket and fast food companies have eaten the price rise without passing it customers.)
The organization is busy " suggesting what potato types should be grown in what area. It also has been paying some farmers to keep their potatoes off the market. The miracle is hat they have, so far, managed to get so any fiercely independent small businessmen (the Framers), to voluntarily comply -- so far. As the article points out, the big challenge will be to keep growers from resuming overproduction, based on a year of good prices.
Cooperatives are not entirely exempt from antitrust regulation.
The growth of cooperatives can been as anti-competitive, as noted by agricultural economist Luther Tweeden "Some cooperatives have consolidated or in other ways grown to a size providing countervailing power against large private firms. In fact, the size and predatory conduct of some large cooperatives has drawn the attention of antitrust agencies in recent decades."
For example, in 2004, the US Justice Department settled an action against the Eastern Mushroom Marketing Cooperative, the nation's largest mushroom farmer cooperative, which has been buying up rival farms and closing them down, something called "supply control" that is an antirust
