Trade barriers to grain cooperatives in exporting
The objective of this study was to determine if there were any barriers to grain cooperatives in exporting. Barriers are obstacles associated with the structure of the market. Data compiled to determine if any barriers existed were a combination of a quantitative survey and interviews with cooperative executives. Thus the emphasis was on the perception held by cooperative decision makers. The study contains a thorough literature review of previous studies on grain cooperatives and exporting, plus a comparative study of Riceland Industries and Farmers Export Company. These two firms operate with similar objectives but with distinct organizational structure, historical development and market structure. This study illuminates the main reasons why cooperative exporting ventures succeed or fail. The set of declarative hypothesis covered the financial capability of grain cooperatives to export on a large scale, the level of diversification to cover risk, the presence of domestic and international obstacles that discriminate against cooperatives, the positive or negative influences of trading in one area of the world, and the organizational structure of cooperatives. The general conclusion was that only one major obstacle existed, along with a minor difficulty. The minor problem existed with the regionals. As long as they operate independently, they remain inadequately diversified to operate in a large-scale exporting environment. The major problem was that grain cooperatives do not have an effective, centralized mechanism to jointly manage and control grain flow so as to expedite grain exporting. Until this problem is solved, any joint activity will probably end in failure.
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