University of Wisconsin Center for Cooperatives

Northeast Missouri Grain Processors, Inc.: Community Case Study

A report for the U.S. Department of Agriculture Fund for Rural America in support for the Fund for Rural America Center for Cooperative Enterprise. Februrary 1998

By Kristi Livingston and Michael Cook, University of Missouri, Columbia; Robert King, University of Minnesota, St. Paul, Anne Reynolds, University of Wisconsin, Madison, David Trechter, University of Wisconsin, River Falls

Summary

Northeast Missouri Grain Processors, Inc. is an organizational pioneering endeavor as it seeks to successfully become the first defined membership, value-added or "new generation" cooperative in Missouri. The cooperative was formed to explore the economic feasibility of the construction of an ethanol plant. The goal is to create a new market for corn and to provide a value-added use to increase profitability. The group is currently holding informational meetings to raise equity from producers. Macon has been selected as the site of proposed plant. Key lessons learned include:

Do not underestimate the need for and the time required to educate people about value-added cooperatives.
The legal setting of a particular state must be understood. Many of the procedures used in the formation of new generation cooperatives in other states were deemed not to be permissible under Missouri statutes and regulations.
Absence of an adequate base of knowledge about the structure of new generation cooperatives and Missouri laws/regulations has been a major constraint. This has greatly increased the time necessary for bringing the cooperative to this point.
As the first to explore the organizational feasibility within the state's legal and regulatory environment, there are unique research, technical assistance and educational program needs.
There is a keen interest among producers and the community in expanded, future opportunities for farmer-owned, valued-added enterprises. The new cooperative is viewed as a threshold that can significantly advance future self-help possibilities.

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