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Cooperatives in Mexico. Alejandro Cervantes summer of 2005. History.
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Cooperatives in Mexico Alejandro Cervantes summer of 2005
History • Nearly eighty years after enactment, agrarian reform remains at once one of the Mexican Revolution's most impressive accomplishments and enduring failures. At the onset of the revolution, huge haciendas controlled almost all agricultural land. • The Agrarian Reform Act of 1915 and the constitution of 1917 laid the groundwork for dramatic changes in Mexico's land tenure system. These documents established that the nation retained ultimate control over privately held land, which could be expropriated and redistributed in the public interest to campesinos.
The ejido, or communally farmed plot, emerged as the uniquely Mexican form of redistributing large landholdings. Under this arrangement, a group of villagers could petition the government to seize private properties that exceeded certain specified sizes - initially 150 hectares (370 acres) for irrigated land and 200 hectares (494 acres) for rain-fed holdings. Assuming a favorable review of the petition, the government then expropriated the property and created an ejido . • The state retained title to the land but granted the villagers, now known as ejidatarios, the right to farm the land, either in a collective manner or through the designation of individual parcelas.
Ejidatarios could not sell or mortgage their land but could pass usufruct rights to their heirs. • Ejidatarios had to work their land regularly in order to maintain rights over it. • In cases where villagers established that they had collectively farmed the land in question before its eventual consolidation into a hacienda, the government created an agrarian community (comunidad agraria). Comuneros (members of agrarian communities), who lived primarily in southern Mexico, had largely the same rights and responsibilities as ejidatarios.
Mexican administrations have varied widely in the importance accorded to the ejido . During the 1920s and early 1930s, policy makers typically viewed the ejido as a transitional system that would lead to small private farms nationwide. • During the next three decades, the government favored large-scale commercial agriculture at the expense of the ejido. Federally funded irrigation projects in some states. • In 1970’s, Luis Echeverría as president, shifted government priorities back to the ejido. Echeverría felt that the ejido would play a leading role in meeting domestic food demand. Echeverría increased ejido holdings by some 17 million hectares (42 million acres)
Collectivized ejidos received preferential access to credit and farm equipment through government agencies such as the National Bank of Rural Credit. • It is important to mention that the credits were very cheap (very low interest rate) and in many occasions not even the payment of the credit was required. • Echeverría's successor, López Portillo, distributed only about 1.8 million hectares to ejidos . Yet like Echeverría, López Portillo sought to channel government resources to ejidos. • Following the discovery of vast petroleum reserves along Mexico's southeastern coast, López Portillo used oil profits to establish the Mexican Food System, which sought to ensure national self-sufficiency in basic staples, such as corn and beans.
López Portillo encouraged ejidos to play a major role in this effort and channeled petrodollars to agencies offering credit to ejidatarios . For many ejidatarios , however, credit merely generated increased debt and dependence on government bureaucracies without significantly improving their overall conditions. • In the wake of the debt crisis that began in 1982, the administration of Miguel de la Madrid Hurtado (1982-88) abolished the Mexican Food System and cut agricultural funding by two-thirds. • Despite collectivist efforts of Echeverría and, to a much lesser extent, López Portillo, a national survey released at the beginning of the Salinas presidency revealed that approximately 88 percent of ejidatarios and comuneros farmed individual parcelas
Mexico's post-1940 population explosion produced a continual subdivision of most parcelas , resulting in holdings that were below subsistence level. According to the 1991 agricultural census, nearly 31% of all ejidatarios held parcelas of two hectares or less, far below the amount of land required to support a family. Another 27% maintained holdings ranging from two to five hectares, with 38% farming parcelas of between five and twenty hectares . Less than 3% of ejidatarios held individual plots of between twenty and fifty hectares. • Data from the 1991 agricultural census on private landholding patterns revealed an even more stratified picture. Nearly 40 percent of all private (non-ejido ) farmers held plots of two hectares or less, with an additional 17 percent working plots of between two and five hectares. Together, these two groups had only 2 percent of the privately owned land area. In contrast, 2 percent of all landholders controlled nearly 63 percent of the privately owned land. Holdings exceeding 2,500 hectares were particularly in evidence in the north (especially in Chihuahua and Sonora) and in Chiapas.
Some studies estimate that up to half of the irrigated ejido lands in Sonora and Sinaloa and up to half of such holdings in the Bajío region of Guanajuato and southern Michoacán are rented. Regular migration to the United States also is an essential survival strategy for many campesinos, with remittances allowing many families to remain in the countryside. Many young campesinos spend the bulk of the year working in the United States, returning to their plots only during the planting and harvesting seasons. An unknown number of campesinos in isolated communities in southern and western Mexico also engage in narcotics trafficking.
Conditions for cooperatives • Ejidatarios remain highly dependent on the bureaucratic channels of both the state and the ruling PRI). All ejidatarios are automatically members of the peasant sector of the PRI; but owing to their lack of political experience, they become easily manipulated by professional "peasant" leaders in Mexico City, who are usually of middle-class backgrounds. Many ejidatarios look to the state as a modern patrón (traditional paternalistic landlord) who has the power to control prices, credit opportunities, and access to farm machinery and water rights and who must be continuously courted and reminded of their pressing needs. • To all this it is necessary to add conditions of corruption and deceit with social programs, abuse authority, fights between the members of the ejidos for possession of communal property, machinery, wells, and market.
Confronted with the dysfunctional character of much of Mexican agriculture, the government in 1992 radically changed the ejido land tenure system, codifying some existing actions that were illegal but widely practiced and introducing several new features. • Under the new law, an ejido can award its members individual titles to the land, not merely usufruct rights to their parcelas . • Ejidatarios can, in turn, choose to rent, sell, or mortgage their properties. Ejidatarios do not need to work their lands to maintain ownership over them. • They also may enter into partnerships with private entrepreneurs. The law also effectively ends the redistribution of land through government decree. • Finally, the processing and resolution of land disputes are decentralized.
The government's perspective is that these new measures provide ejidatarios with more realistic and sensible options. A winnowing effect is anticipated, as some inefficient and marginal producers sell their properties to more efficient farmers. With property to mortgage, the more entrepreneurial ejidatarios have collateral that can be used to obtain private-sector credit. By removing the prospect of widespread government-directed land redistribution, owners will be more likely to invest resources to increase agricultural production. • Since Salinas’ government, Zedillo and Fox worked strongly in to developing new sources of subsistence for the ejidatarios promoting the conformation of groups of farmers focused to the market, unfortunately, the farmers were victims of abuses for many years and now they don’t believe in work together, government social programs and the private industry.
The other face of the currency • In Mexico we have several examples of successful cooperatives, among them are the cases of Lala, Alpura, Pascual and many others, is important to mention, have been conformed by people to high economic potential and vision. • In the Mexico of the Fifties, each dairy ranch processed and distributed its milk of independent way. On that rustic context, in the North of Mexico initiates a history forged by a group of men with great vision and enterprising spirit. They conformed the Group LALA, 20 years later, also in the country center, the National association of pure milk producers conformed the cooperative Alpura, whose fundamental objective were to improve the quality and the hygiene of the milk of the partners who had distribution in the city of Mexico, and of the dairy cattle dealers who were suppliers of other states.
“Group LALA transforms the natural resources into search of the best quality. With hundreds of stables and more than 200,000 heads of select cattle, a culture is originated that is reflected in products that day to day, conquer the preference of the consumers.” • Mission • “We fed every day... all the life” • Elaborating and commercializing products of the highest quality. • Innovating constantly. • With marks of high value. • Thanks to a human, able equipment and jeopardize.
LALA is present in all Mexico. They has 8 located plants in the more important centers of population of the Republic and has the ampler cooled network of distribution in Mexico. With more than 3,500 routes and 128 centers of distribution, LALA visits more than 200 thousand clients every day, obtaining a sale of almost 8.8 million daily pounds of milk and thousands of tons of diverse milky products. http://www.lala.com.mx/
The Alpura Group is one of the top Mexican dairy food producers with over 82,000 cows on around 160 dairy farms producing more than 4.4 million pounds of milk per day for two processing plants. • Hundreds of supermarkets in Mexico carry Alpura’s wide variety of dairy products. The Alpura Group in Mexico is made up of 11 companies that support the production cycle. These include companies that specialize in financing, cow embryos, plastic containers, milk processing and transportation. • Mission • To satisfy the consumers needs, being elaborated innovating products of high quality, that offer a style of healthful life, providing the best nutrition and confidence.
Ganaderos Productores De Leche Pura S.A. is the official name for the company that produces the products, but the company is usually referred to by its popular brand name Alpura. Alpura produces a wide variety of products including liquid milk, milk powder, cheese, desserts, yogurt, creams, butter and even bottled water. http://www.alpura.com.mx/
In the case of both cooperatives, they do not admit more partners, so for small or medium size producers it’s impossible to accede to that companies, for the other hand, the cost of conforming a similar company is huge. • It’s for that reason, I’m thinking about developing new niches of market that are not being covered by those companies, with simple products with great demand. • Imitating the good practices of organization and labor culture, consolidating the distribution and the quality of the products that have those great cooperatives, although there is much work to do.
Of the most important things that I learned in Wisconsin, through the talks with business people and professors: • To focus mainly in local market, independently that the tendencies are towards the globalization, or specialties products. • To have a name and brand (Product identification, Positioning) • To operate the competitive advantage (“Fresh cheese…as fresh as the morning of today”) • To establish clearly the principles of the cooperative. • To identify producers with similar capacities. • To establish technical systems of health and quality.
History • MASD ASD
