Mergers Likely to Continue as Cooperatives Benefit from Economies of Scale
The article shows that agricultural cooperatives can save money by getting bigger and offering more products. It found that most cooperatives benefit from getting larger, but individual products don't always save money when produced in bigger quantities. Over time, cooperatives have become less efficient, but the benefits of getting bigger have stayed the same. Smaller cooperatives can save more money by growing in size rather than just becoming more efficient. This means that small cooperatives will likely merge until they can't save any more money by getting bigger.