The state of agri-cooperatives in Denmank

Esben Tranholm Nielsen, Chief policy advisor of the Danish Agriculture & Food Council, spoke at «Ypaithros Chora», about the agri-cooperatives in his country

What is the state of play ( basic information/figures : number of coops, turnover, key sectors, share of country’s production and agri-export activity) and the challenges that agri-cooperatives in your country are facing at the moment?

Danish farmers are predominately organized on a voluntary basis in co-operatives, which are owned by the farmers. Farmers are free to join and free to leave the cooperative, and there is no governmental involvement in supporting the organization of farmers in cooperatives and the day-to-day operation of cooperatives. The Danish cooperatives are founded on three pillars:

  • Economic advantages
  • Trust
  • Democratic structure

Most of the Danish farmers use the option to be in cooperatives. Through the promotion and creation of cooperatives and other efficiency enhancing forms of cooperation among producers, farmers can become more competitive by reducing their costs and reinforcing their bargaining position in the food chain through larger scales and better marketing of their products (innovation of new products, brands etc.).

  • 95 pct. of the dairy production in Denmark is delivered to cooperatives.
  • The story is almost the same in the pork and beef sector, where around 90 pct. of the pig production in Denmark is slaughtered in cooperatives.
  • In the eggs sector we have cooperatives which is more than hundred years old.
  • The two biggest co-ops within crop production more or less account for the entire production.

The biggest challenges ahead are the consequences of Brexit and the climate 2030 targets.

Below you will find some figures for turnover.

Evolution of top agricultural co-operatives 2011-2013 (turnover i MEUR)

Source: Development of agricultural co-operatives in the EU 2014, published by Copa-Cogeca, 2015.

What are the strategic priorities set by your organization in favor of the support and development of agri-coopreatives in your country?

The Danish Agriculture & Food Council is working for the best business conditions for our farmers and cooperatives, e.g. taxing condition, funding for research and innovation, regulation, the CAP etc.

Is the national legal framework favorable to the development of agri-coops? Have there been any recent positive developments when it comes to this? Is your organization currently taking any initiative to improve the national legal framework?

There is no specific co-op legislation in place in Denmark. However, there are specific provisions on taxing conditions, mergers etc.

Denmark: Only one pork processing cooperative has a turnover of 8 billion eurosA short comment on what you expect from the CAP post 2020 when it comes to agri-cooperatives.

There are many parts of Europe, where there is not a high level of consolidation in the farming community in co-ops or pos.

Many reforms of the CAP-policy have in recent years been aimed at enhancing the role of producer organizations.

We believe this trend will continue, besides the discussion on securing a better return for farmers in the food chain.

What are agri-cooperatives and your organization doing in order to promote/integrate innovation?

Our co-ops are very mindful of having enough supply for production, and therefore go to great lengths for securing the best price for the farmers.

A lot of effort is put on making the businesses more efficient, innovation of new products, brands etc. – all in order to pay the best possible price.

How are agri-cooperatives in your country performing in the pig meat sector (basic information/figures, challenges, strategic priorities, best practices)?

For general figures on Danish Crown, see table above. The most principle challenge is getting enough supply of pigs.

There is unfortunately a trend, where especially piglets are exported to Germany. Danish Crown has implemented a new strategy called “Four Wheel Drive” in order to secure a higher price for the farmers as a response to this trend.