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Federation of Southern Cooperatives Makes Big Move To Become an International Player
By
Donald Washington and Kurt Seifarth
After 31 years of advocacy on behalf of African-American farmers, the Federation of Southern Cooperatives/Land Assistance Fund is taking on a new challenge – marketing its members’ products in the international market.
The primarily African-American cooperative organization finalized its first major export sale of sweet potatoes to Canada in March 1998 and is looking to expand to other countries in 1999.
AgExporter recently spoke with Ralph Paige, Executive Director, and Cornelius Blanding, Marketing Director.
AgExporter: Why is there a need for your cooperative?
Paige: Our organization provides a means by which African-American farmers can be competitive in the commercial market arena. Cooperatives enable our farmers to pool resources and produce both the quality and quantity required.
AgExporter: Give us some background on the Federation.
Blanding: The Federation of Southern Cooperatives/Land Assistance Fund (LAF) is a 31-year-old organization that provides technical, educational and advocacy assistance to minority farmers throughout the southeastern United States. The Federation/LAF also works with urban non-government organizations (NGOs) and religious institutions to help its members market high-quality, affordable food to urban consumers.
We are, in fact, the only organization in the southeastern United States that has as its primary objective the retention of black-owned land. We also promote the use of cooperatives for land-based economic development.
Our extended membership includes 12,000 black farm families who, individually, own small acreage. Collectively though, they own over half-a-million acres of land and work through 35 agricultural cooperatives.
We also encompass 11,000 small savers in 19 community development credit unions that have accumulated over $14 million in savings and made over $56 million in loans since their inception.
Our members produce peanuts, corn, wheat, soybeans and cotton. However, in 1998, many of our members have grown alternative crops such as vegetables and fruit rather than the traditional row crops.
The Federation provides members with extensive cooperative training, technical support in marketing and assistance in securing reliable markets. The Federation/LAF owns and operates the Rural Training and Research Center on 850 acres of land near Epes, Alabama, where we teach members the skills of farming, business and working together in cooperatives.
Marketing efforts are centered around three components: rural/urban, direct marketing (where farmers sell directly to the large grocery chains) and emerging markets, where we help members sell their products in the international market.
In March 1998, Federation/LAF members successfully made their first international transaction by exporting 2.5 tons of sweet potatoes to Ontario, Canada.
AgExporter: When did you start thinking about exporting?
Paige: The Federation has always considered exporting. Over the years, we’ve received numerous requests from Africa as well as Mexico, Canada and St. Thomas, in the Caribbean.
We just never had the resources to set up a marketing department or to develop a strategy and structured program. However, in 1996, we signed a memo of understanding with USDA to begin the work towards a day when we would sell our products abroad.
Then we worked for two years to develop a structure to support an exporting program and to restructure our organization to include and complement the necessary changes. Finally, we had to learn how to export, which boils down to logistics.
In September 1997, the Federation signed an agreement with USDA to participate in its Emerging Markets Program (EMP).
In its short life, the EMP has created a number of exciting new opportunities. We have made considerable progress that has manifested itself in several ways. For example, we’ve participated in the Southern U.S. Trade Association’s trade mission to Canada and the Food Marketing Institute Food and Trade Show in Chicago in May 1998. We’ve also been busy developing a product list and a marketing plan and we’ve made contact with shipping agents, the Embassy of Zimbabwe, the Embassy of Estonia and an Estonian confectionary factory.
Our future plans for the Federation’s Emerging Markets Program include: an export/import program between the Federation/LAF and Kalev, an Estonian confectionary factory; market research in Southern Africa; collaboration and partnership with a proposed distribution channel in Estonia.
Trade shows have produced valuable contacts, as well as new insight into possibilities for marketing Federation/LAF produce – fresh and processed – to international as well as domestic markets.
Moreover, the current plan of the EMP is to gain more access to emerging markets, stay abreast of international demand and inform them of Federation/LAF, its members and their products.
AgExporter: What internal challenges did you face?
Blanding: The biggest challenges we faced internally, besides the obvious and forever-present financial challenges, were: introducing the idea to members who had no experience in exporting, learning the ins and outs and obtaining the resources to hire a marketing staff.
AgExporter: What fell into place to make the Canadian sale happen?
Paige: There were numerous variables that contributed to the sale in Canada, but several events fell into place together at the right time to make it all happen. We hired a marketing person to direct the transaction, set up a team to assist the marketing director, developed relationships in Canada, and – most importantly – there was a demand for our products.
Cornelius joined Ben Burkett, farmer and Federation/LAF State
Coordinator of Mississippi, on a trip to Toronto. During that
USDA-coordinated marketing effort, they worked out a deal to ship
Mound Bayou sweet potatoes to Longo’s, a large fruit,
vegetable and retail grocery outlet in Ontario, Canada. 
AgExporter: What has the Federation done to fit exporting into this structure?
Blanding: Today, we have made exporting an integral part of the overall marketing program. By this, I mean we have begun to structure a marketing component that would concentrate on both domestic sales and exporting. We are gearing up to help our co-ops develop the infrastructure that will enable them to identify and meet the demands of the international market.
AgExporter: How has exporting changed the organization?
Paige: Exporting has changed the whole outlook of the organization; we have now begun to view exporting as a very real opportunity to increase sales and profits.
Moreover, because of the emerging market grant, we have begun to develop markets in countries such as Estonia, Zimbabwe and South Africa.
AgExporter: Where are you going from here?
Blanding: Since our introduction into the export arena, we are moving toward setting up a defined market strategy that includes exporting. We will continue to develop export markets so that they become primary income generators for our farmers and the Federation.
Exactly where we will end up from this point on is uncertain because much more work needs to be done.
For more than three decades, the Federation/LAF has held fast to its basic mission of community-based development and we will continue to do so.
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For further information contact the Federation of Southern
Cooperatives, Land Assistance Fund, East Point, Georgia. Tel.:
(404) 765-0991; Fax (404) 765-9178.
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