National Co-op Month - AgTexas Farm Credit Services

National Co-op Month

By October 31, 2023November 16th, 2023Blog
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National Co-op Month

October is National Co-op Month so let’s take this opportunity to give some insight on what a cooperative structure is and how it benefits the customer. For those who don’t know, AgTexas Farm Credit Services is a co-op, which means we are 100% member-owned and governed by a board of directors elected and/or appointed by our member-owners. As our website states, “In a cooperative, people make the difference. Each stockholder (member-owner) has a voice in the business of the co-op and a vote indirector elections. Those who oversee the Association are just like you – producers and business owners involved in agriculture.”

Cowboy riding pens black and white

This means that our customers are referred to as member-owners and share a portion of AgTexas profits every year called patronage. Our patronage program is a unique benefit that Farm Credit offers that a commercial bank or credit union does not. This is only possible through the cooperative business model. Additionally, because we are 100% member-owned, our tagline “Your Success. Our Purpose.” could not be more true. When the customer is successful, AgTexas is successful. When the customer has a hard year, AgTexas has a hard year. We truly desire for all of our member-owners to experience success, whether it be receiving support in hardships or rejoicing with them in profitable years. AgTexas is here, providing reliable credit and crop insurance to our stockholders in times of prosperity and adversity. This is largely attributed to the fact that the cooperative is governed and staffed by experts in the agricultural industry, many of whom are directly involved in production agriculture. For more information on the cooperative structure check out this web page from the national Farm Credit website → https://farmcredit.com/our-structure.

That being said, let’s recap some history of the cooperative business structure in Farm Credit. According to the Farm Credit website, in 1916, the United States government wanted to provide a sustainable way to provide long-term credit to rural America which led to the creation of the Farm Credit system. This was intended to service land purchases for farmers and ranchers. A few years later, it became evident there was demand for shorter operating funds to assist in annual production costs and equipment purchases. That prompted the passing of the Agricultural Credits Act of 1923 which extended funding to include short-term operating credit for agricultural practices. A decade later, the great depression hit and thankfully, Farm Credit expanded and allowed farmers and ranchers to maintain their livelihood. Since then, Farm Credit has continually grown and expandedPatronage Chart across the nation. Today, AgTexas Farm Credit Services is proud to say we have provided agricultural funding across the Association with over $110.6 million paid out to our member-owners in patronage over the past 5 years. This has only been made possible by the cooperative business model.

This is just a glimpse into the structure of a co-op and how the cooperative model has shaped Farm Credit and rural America over the years, specifically regarding AgTexas. In the spirit of #NationalCoopMonth, I would encourage you to check out more resources on our website or the Farm Credit website to gain additional insight into the cooperative structure. Our main goal as an Association is to keep the member’s best interest at heart – thankfully, operating as a co-op has allowed us to do just that.

Ag Always,
Hadley Chote

Sources:
Our structure. Farm Credit. (n.d.). https://farmcredit.com/our-structure
Patronage. AgTexas Farm Credit Services. https://www.agtexas.com/who-we-are/patronage/