1.3 Producer Coöperatives | Land O’Lakes

Producer coöperatives are especially prevalent in agriculture and farming, in which many companies operating under coöperative principles have become household names, such as Land O’Lakes, Sunkist, or Ocean Spray.

Land O’Lakes, for instance, is a farmer-owned food and agricultural coöperative that is now a Fortune 200 and operates under several well-known trademarks, including Land O’Lakes, Purina Animal Nutrition, and WinField Solutions. Land O’Lakes classifies itself as a “farmer- and retail-owned cooperative” with a primary focus on “always supporting member-owners,” as the company states in its Annual Report for 2019.⁷⁵ The organization spans horizontally across the agricultural field, from seed and crop inputs, to B2B marketing, to branded good sales, and, of course, to butter.⁷⁶

Land O’Lakes originally started about one hundred years ago as the Minnesota Cooperative Creameries Association, the product of 320 dairy farmers meeting in St. Paul, Minnesota, with the purpose, in their own words, to “joint together to effectively market and distribute members’ dairy production across the country.”⁷⁷ Land O’Lakes is now governed by a board of directors that is elected by its members—nearly half are elected by the dairy producers and the other half are elected by the agricultural members.⁷⁸ The directors are elected to four-year terms at the organization’s annual meetings by voting members. The board determines “policies and business objectives, controls financial policy, and hires the CEO.”⁷⁹

As of February 2020, Land O’Lakes consists of 1,711 dairy producers, 744 agricultural producers, and 989 agricultural retailers.⁸⁰ And it is doing extremely well. Land O’Lakes has net sales of $14 billion, net earnings of $207 million, and returns $187 million in cash to its members.