Financial versus Production Contracts Coordination in Brazilian Farm Cooperatives

ABSTRACT

Agribusiness coordination relies, in great concern, on agricultural cooperatives management of credit and operations, especially in Brazil. This essay is on economic efficiency of financial and production coordination of top Brazilian farm cooperatives. We test financial versus production contracts on cooperative economic efficiency indicators. Marketing cooperatives in grain and coffee markets as well as supply cooperatives are distinguished from dairy, hogs and poultry vertically integrated co-ops. We argue that, different financial instruments have to be attached on farm co-operatives’ financial strategies according to their commodity or added value product markets. As Brazilian agribusiness is getting more financially integrated and is relying more on financial market mechanisms, the new financial titles and their relation to cooperative financial and growth viability are issues that deserve more attention.

Trabalho apresentado no IV Encontro de Pesquisadores Latino-Americanos, organizado pela Rede Latino-Americana de Pesquisadores em Cooperativismo e pelo Comitê Regional Latino-Americano de Pesquisa da Aliança Cooperativa Internacional, em Rosário, Santa Fé, Argentina, nos dias 14 e 15 de setembro de 2006.

Resumo