About co-operatives

Co-ops are businesses that create value to share among their members. In a co-op, ownership and control is shared equally amongst members who use their co-op. Members of a co-op are people, other businesses, employees or other community stakeholders who work together to achieve a common purpose or outcome.

In broad terms, a successful co-operative harnesses the interests of its members to drive its performance.

Sometimes people feel that a co-operative structure is a good thing in itself, and that by adopting a co-operative structure an enterprise gains an immediate advantage of some kind. It’s important to make the right choice at the outset.

Australia has a proud tradition of agricultural producer co-operatives, and we can point to many excellent examples. In a successful producer co-operative the voice which producers have enables them to shape and improve the co-op’s performance and the ownership they have encourages them to think about the way they use what the co-op offers.

Learn how to:

  1. Plan your co-operative
  2. Start your co-operative
  3. Run your co-operative

Co-operatives in Australia

About the Business Council of Co-operatives and Mutuals (BCCM)

The Business Council of Co-operatives and Mutuals (BCCM) is the national peak body for co-operatives and mutuals in Australia. It is a member-funded and driven organisation, representing co-operatives and mutuals in all industries including agriculture, finance, insurance, mobility services, health, housing, retail and wholesale.

BCCM’s 80 members represent a combined 60,000 businesses and 11 million members. BCCM’s membership includes leading agricultural co-operatives that support the profitability of thousands of Australian primary producers by providing market access, increased bargaining power and reduced business costs. The largest agricultural co-operatives in Australia have a combined turnover of approximately $6.5 billion (National Mutual Economy Report 2019).

From 2016-2019 the BCCM coordinated industry action to work with Government to bring forward the first enabling legislation for co-operatives and mutuals in 18 years.

Farming, fishery and forestry co-operatives

Farming to finance, health to housing, motoring to manufacturing, co-operatives and mutuals deliver trusted products and services in some of the most competitive domestic and international markets.

Agricultural co-operatives are formed by groups of producers to process, distribute and market their products. In some cases, they provide farmers and fishers with facilities for the supply and storage of inputs for agricultural production, such as fertilisers, seeds, fuel, water and ploughing or harvesting services. Agricultural co-operatives seek to maximise the benefits to their farmer members by helping them to access markets, services and products on a more cost-effective basis than can be achieved individually.

A deep heritage: Australia’s first co-operatives

The earliest agricultural co-operatives emerged in the dairy industry on the NSW coast in the 1880s. These were formed by dairy farmers looking to bypass agents to get a better price for their products and to raise capital to build factories to process their milk.

These early pioneers learned that every farm’s security was linked to the success of their neighbours. By co-operating, they had a much better chance of long-term survival. By the eve of World War I, the eastern Australian dairy co-operative movement had grown significantly. More than 70 per cent of all dairy products were processed in co-operative factories and marketed and distributed through co-operative agencies.

Co-operatives were established across Australia beyond dairy, in wheat crops, horticulture, fruit, fishing and forestry. Since then, agricultural cooperatives have continued to help farmers process and market their products, improving profits for their members.

The scale of co-operative agriculture, fishing and forestry

Agricultural production is of great importance to the prosperity of Australia. Around 70 per cent of Australian farm production is exported, with agriculture making up 11 per cent of Australia’s total exports.

Agri-business has a direct impact on the lives and livelihoods of many Australians. According to the Australian Bureau of Statistics there are nearly 90,000 farms in Australia, the majority family-owned.

Agriculture, fisheries and forestry collectively employ approximately 320,700 people, which accounts for 2.5 per cent of the total national workforce.

Regional Australia relies on the success of the agricultural economy. It is home to just under a third of the Australian population and faces many challenges: high labour mobility, declining number of skilled jobs in resources industries, increased infrastructure and transport requirements.

Australia’s agricultural sector has been remarkably resilient in 2019-20 despite prolonged drought and widespread bushfires. The value of farm production is expected to be $59 billion, helped by high commodity prices.

Graph: Agriculture, fisheries and forestry value of production by commodity 2018-19

Co-operatives as part of Australian agri-business

Co-operatives are active in all parts of Australia’s agricultural economy, helping farmers to compete in ways that they could not do alone.

Grain co-operatives provide a wide range of services for individual grain farmers, from seed and fertiliser supply to securing the best crop price and shipping to markets. The largest single co-operative in Australia is Co-operative Bulk Handling (CBH Group), which handles and markets grain crops from nearly 4,000 farms.

Livestock co-operatives help farmers to produce some of the best quality meat products in the world. Beef, lamb, pork, chicken and other animals are reared on individual farms and brought to market by the co-operatives. The animals are processed in the co-operative facilities, where they are prepared for shipment to markets across Australia and overseas.

Dairy co-operatives help to ensure that farmers get a fair farm gate price for the milk their herds produce. Milk volumes are combined from individual farms for processing and packaging for markets. Milk, cream and cheese products are manufactured to add value to the raw materials, supplying major supermarkets and overseas markets and returning the profit from this production to the farmer-owners.

Fruit and vegetable co-operatives help growers from all parts of Australia to get their produce onto supermarket shelves. All parts of the logistics process, from the farm to packaging facilities, are conducted by the co-op. Co-operatives also provide scientific support on crop-maximising technology, developing new varieties, storage and pest control.

Fishing co-operatives play a significant part in supporting Australia’s commercial fishing fleet. Fishers may own just a single vessel but through the co-operative they are able to combine their catch and access processing and marketing services to supply their own fisher owned brands. The co-op helps them to get their produce into global seafood markets.

Forestry co-operatives help individual foresters to process, market and sell their timber and timber products in the global marketplace. Wood supply from small landholders has a long and successful history in New Zealand and Scandinavia and could be a major positive step for Australian farmers.

Farm supplies co-operatives help to minimise input costs and secure the supply chain. These co-operatives a full range of rural merchandise and supplies to Australian farmers, some expanding their offering to include agronomist advice and support regarding livestock production, crop maximisation and water trading.

Irrigation co-operatives supply local growers with water, with some also distributing stock and garden water to blocks in the community. These co-ops have often been created from a transfer from Government ownership. A co-operative is an ideal vehicle for ensuring that the business remains true to its purpose of providing efficient and equitable water supplies at the lowest cost possible.

Many Australian agricultural businesses rely on their co-operative to keep them profitable and in business. Across Australia, the Business Council of Cooperatives and Mutuals (BCCM) has identified 229 agri-business co-operatives, 189 of which are involved in farming, fishing or forestry and 40 of which are irrigation and water co-operatives.

These 229 co-operatives represent 23,909 individual members, each of which are separate agricultural businesses employing many more people. They can be a family farm looking after thousands of hectares, a fisher with one or more vessels or fishing licences or an individual grower member of an irrigation co-operative.

16,558 farms out of out of 89,4008 are members of an agricultural co-operative. When membership of irrigation co-ops is added, we estimate that almost a quarter of all Australian agricultural businesses are members of at least one farming, fishing or forestry co-op.

Every member of an agricultural co-operative is a business in its own right, and an employer and commercial player in its region’s economy. As a private business, it will form part of the economic backbone of Australia, contributing to domestic economic growth and export earnings whilst paying income, payroll and property taxes.

What is a Co-operative?

The Business Council of Co-operatives and Mutuals explains what is a co-operative and how the co-operative business model can benefit you.

What co-operatives achieve

Co-operatives are good for Aussie farmers, fishers and foresters
  • They enable independent Australian farmers to compete by providing access to markets.
  • They facilitate economies of scale by enabling individual  businesses to jointly own and control their supply chain.
  • They provide a mechanism to transfer risk from the small producer to the shared business to reduce the barriers to operating successful farm businesses.
  • They support smaller farmers and fishermen to stay in business and remain independent.
  • They spread wealth back to farmers, fishers and foresters through profit-sharing and produce rebates.
Co-operatives are good for Australia’s regions
  • They maintain a traditional way of life whilst providing economic growth to strengthen Australia’s regions.
  • Co-operative agricultural business is a key contributor to the effort to grow a successful, sustainable and domestically owned food manufacturing and processing sector.
  • Co-operatives employ locally both for seasonal and long-term work. This is important in rural and regional areas where quality jobs are scarce, and workforces are changing.
Co-operatives are good for Australia
  • They help to maintain the domestic ownership of strategic food assets.
  • They increase food security for Australians.
  • They help to generate significant export earnings.

[Co-operatives] have been around since before Federation. They've been bringing farmers together across the supply chain. They've been allowing them to cut out the middle guy, reduce their input cost so that they can get back more of the value to the farmgate. They've also been allowing farmers to bring the strength of small businesses together so they can access export markets. They can team up, if you like, to act like a larger player in a market that they wouldn't be able to access as independent businesses.

Melina MorrisonBCCM