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Spain's agri-food cooperative sector

Wiki Spanish Food editorial team

The cooperative sector accounts for a large portion of the productive, industrial and commercial agri-food framework, in both quantitative and qualitative terms. The sector comprises 3,844 associative entities, of which slightly less than 3,400 are farming cooperatives and the remainder are agricultural production cooperatives.

The sector is immersed in a process of concentration, which is slow though ongoing, with revenues of over 25 billion euros, almost 1.18 million members in various productive sectors, and close to 100,000 direct jobs.

Despite progress, the sector remains small. There are no Spanish cooperatives among the 50 largest in the European Union in terms of revenues. In 2013, the largest agri-food cooperative in the EU reported revenues of 11 billion euros, while the largest in Spain barely obtained more than 900 million. Only the 28 cooperatives in Denmark have revenues in line with those in Spain, and 2,400 French cooperatives have revenues which are three times higher than Spanish ones. Average revenue for agri-food cooperatives in Spain as a whole is 6.7 million euros, which contrasts with the 10 largest in the EU, which obtain an average of 380 million euros.

Therefore, there is a clear weakness, due to excess fragmentation and dispersion, which in turn leads to scant bargaining power with other parts of the agri-food value chain, such as the processing industry and, in particular, large supermarket chains, which account for 60.2% of the retail sector in Spain. However, it also has its strengths: it has more than one million members in the various productive sectors and in associated services, and a structure that is well implemented in rural areas.

Broadly speaking, cooperatives' business activity accounts for around 60% of the value of Final Agricultural Production and 30% of the value of net agri-food industry sales, representing 13% of Spanish Agri-food Industries.

According to the most recent general data from EU agri-food cooperatives in the report entitled "Development of agricultural cooperatives in the EU in 2014", drafted by the General Confederation of Agricultural Cooperatives (Cogeca), Spain ranks second in terms of the number of associate agri-food entities, behind Italy, which has 5,834 cooperatives (26.8% of the total in the EU), with 17.7% of the total and 3,844 companies. As for the number of members, once again Spain ranks second in the EU, with 1,179,323 (19.1% of the total), trailing only Germany, which has 1,440,600 (23.3% of the 6,172,746 total cooperative members in the EU). However, in terms of revenues, Spain ranks fifth, behind France, Germany, Italy and the Netherlands, with 25.696 billion euros (7.4% of the EU total), in line with Denmark, which ranks sixth, with 25.009 billion.

According to this study, there are no Spanish entities in the EU's top 25 agri-food cooperatives in terms of revenues, nor are there any in the top 50. The first Spanish cooperative ranks 57th, Coren, with revenues of 982 million euros in 2013, followed by CAPSA/Clas, which ranks 76th, with 677 million; Grupo AN, 78th, with 665 million; Dcoop, 86th (which will have moved up the ranking as it has been one of the most active in cooperative concentration in the last two years), with 564 million, and Anecoop, 94th, with 508 million.

In 2012, the Ministry of Employment and Social Services identified 3,844 active cooperative entities, among them 3,297 first-level cooperatives and 447 agricultural production cooperatives, which have declined by 4.4% in number since 2005, with a slight impact on concentration and business integration, which has increased each company's average revenues.

According to the data available, 74% of cooperatives—which in turn account for 73% of total revenues—are in the following regions: Andalusia, Castile-La Mancha, Castile-León, Valencia, Catalonia and Extremadura.

In terms of subsectores, member agri-food companies play a key role in the production of fruits and vegetables (24.1% of total cooperative revenues and 23.9% of the total number of cooperatives), herbs (8.5% and 17.5%, respectively), olive oil (12.9% and 30.8%), wine (7.2% and 20.9%), fodder (10.3% and 8%), dairy (5.3% and 5.1%), pork (3.5% and 2%), poultry (3.2% and 0.8%), table olives (1.9% and 5.4%), beef (1.4% and 2.5%), etc.

The sector with the most cooperatives is the supply industry (46.1%), followed by olive oil (30.8%), fruits and vegetables (24.3%), wine (20.9%), herbs (17.5%), shops (14.8%), fodder (8.0%), table olives (5.4%), dairy (5.1%), mutton and goat meat (3.3%), beef (2.5%), rice (2.4%), pork (2%), and poultry (0.8%).

It's worth nothing that many first-level cooperatives are part of second-level cooperatives, with the result that there is an invisible structure that's not reflected in this data, such as in the olive oil and supply subsectors, for example. In fact, the 138 second-level cooperatives (2012) accounted for 41% of total cooperative gross revenues (first- and second-level combined).

These entities offer a notable and increasingly large range of services with a view to improving production efficiency and quality, helping members with their activity and, in short, responding to some of their many daily needs, which range from access to supply or farm inputs, which account for 12.8% of total cooperative revenues and 40.1% of the total number of cooperatives, and to other consumer products, technical advice, management, insurance, replacement services, crop selection, financial services, etc.

Around one-third of the total number of agri-food cooperatives export their products, with first-level cooperatives exporting an average of 4.7 million euros worth of goods and second-level exporting 26.3 million euros, with a total weighted average of 6.7 million euros. Around one-fourth of total agri-food cooperative revenues come from sales outside Spain

The specific data about agri-food cooperatives should be taken with a grain of salt, since many cooperatives produce or process more than one product and, therefore, are included in more than one production activity or service, which makes classification and quantification more complex. The idea is to give an approximation of the main sectors and activities in which those cooperatives operate and the degree of fragmentation or concentration within each sector, i.e. their percentage of revenues with respect to the total for all cooperatives and the percentage of the number of sector cooperatives with respect to the total.

According to Cooperativas Agro-alimentarias, associate agricultural entities account for 100% of tobacco production, 80% of the grape must supply, 70% of olive oil and wine and 60% of rice production. They also account for a notable portion of productive sectors such as citrus fruit, cow's and sheep's milk, and nuts, with 45% of the total, and, to a smaller degree, they account for 35% of total sector production of table olives, fruits, mutton and goat's meat, grains, oil products and cotton.

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28/06/2017