Feasibility of Machinery Cooperatives in Oklahoma

Abstract

This study used a feasibility template which calculates and compares the cost of individual and cooperative machinery ownership. Specifically the study focused on the potential for savings to Oklahoma agricultural producer through the formation of machinery cooperatives. Three machinery cooperatives representative of Oklahoman wheat, cotton and hay production were analyzed. A case study of was also examined for a group of Oklahoma hay producers. Machinery operating cost was typically reduced by 12 to 29% in the base scenarios. Various sizes of machinery cooperatives were examined and savings increased as the number of members increased. The initial investment required by the producers was reduced by 16 to 60% as the numbers of members in the machinery cooperative increased form 3 to 5 members. . Even with the addition of transportation and setup time in the machinery cooperative completion of the production activities was not an issue for these machinery cooperative examples. Machinery cooperatives allow producer the ability to achieve greater efficiency of their machinery by using more of its capacity in a machinery cooperative.