Growing the size of the agricultural co-operative sector
Resource
The UK’s agricultural co-operatives contribute nearly £10bn a year to the economy - yet the sector remains far smaller than in comparable countries. Strengthening co-operation can boost farm incomes, increase productivity, accelerate innovation and improve national food security. This report sets out practical proposals for government and industry to work together to grow the agricultural co-operative sector and unlock its full potential.
Farmers who belong to co-operatives secure better prices, pay lower input costs and save significant time through shared services. Arla members receive around 51% of the retail price of milk compared to 43% for non-co-operative suppliers, while AF members routinely achieve savings of 5% to 30% across major inputs such as electricity, fertiliser, crop protection and veterinary medicines
Meanwhile, producer organisations in horticulture have driven extraordinary improvements in yields, product quality and environmental performance by enabling collective investment in technology, robotics and advanced growing systems that would be unaffordable for individual growers. These benefits translate into greater resilience, reduced risk and stronger local economies.
A call for unified action
Despite the evidence and benefits of farmer co-operatives, major barriers remain. This report identifies urgent policy needs, including better national data on agricultural co-operation, modernised capital rules, targeted financial support for co-operatives, clearer regulatory frameworks and an expansion of collaborative advisory services. It also recommends that government use public procurement to expand markets for co-operative produce and address issues in Fair Dealing regulations that fail to recognise the role of co-operatives in supply chain fairness.
These proposals reflect the expertise of organisations across the sector and form a unified call for government action. By strengthening agricultural co-operatives, the UK can build a fairer, more productive and more resilient food system while delivering on national policy commitments and supporting farmers through a period of intense economic challenge.
